Insurers embrace telemedicine as regulators ease requirements

Just as the pandemic has accelerated digital transformation in the property/casualty insurance world, the outbreak has also hastened the development of telemedicine, sources say. 

“One thing that may be accelerating is the growing acceptance of telemedicine,” said James Auden, Chicago-based managing director of insurance at Fitch Ratings Inc. 

Insurers were “dabbling” in telemedicine in “a lot of areas,” said Brad Ellis, senior director at Fitch Ratings in New York. The pandemic forced insurers to move faster in the implementation of telemedicine. 

“We’re actually seeing the development of ‘virtual first’ health plans,” under which a first visit must be virtual prior to going to a physical office, he said. 

In a recent report, A.M. Best Co. Inc. stated that “the COVID-19 pandemic has pushed telemedicine to the forefront of innovation in the health industry.” 

The report noted that pre-pandemic usage was minimal at best. “Stay-at-home requirements designed to contain the spread of COVID-19, combined with fear of exposure to COVID-19, has resulted in greater acceptance of telehealth solutions by health care providers, insurers, and patients,” the report said.

Health care, however, is a highly regulated segment of the insurance market, said Doniella Pliss, a director at A.M. Best Co. Inc. in Oldwick, New Jersey, and it was the relaxation of “numerous” regulations that allowed for more replacement of physical visits with telehealth visits. 

While some of the regulations were removed permanently, others were relaxed as emergency measures and it is unclear if all of the changes will remain in place, which could have an effect on the further proliferation of telemedicine and telehealth plans, she said. For example, relaxing reimbursement regulations to allow payments for telehealth.