Telehealth surge prompts shifts in health care supply chain

“Everyone’s trying to figure out, how do they skate to the puck?” David Gillan, senior vice president of sourcing operations for Vizient, told FreightWaves. “Where’s the puck going and what’s our role in that? It does affect the entire ecosystem.”

The data: Nearly any way you measure it, telehealth visits increased dramatically in 2020.

Telehealth appointments through Veterans Affairs increased by more than 1,200% in fiscal year 2020.

A report from the group purchasing organization Vizient found that the proportion of outpatient visits conducted using telehealth jumped from 0.3% in 2019 to 22% by the spring of 2021.

(Source: Data from the Clinical Practice Solutions Center, developed by the Association of American Medical Colleges and Vizient, used by permission of Vizient Inc. All rights reserved.)

So what? It’s clear that preferences are changing, Gillan said. Patients want to get more care at home. The big question is how much virtual care they’ll want going forward.

“That’s the unknown. … How much in-person versus virtual ultimately?” Gillan said. 

Over the past year, Gillan said many medical suppliers have focused on overcoming shortages and responding to the immediate needs of the pandemic. 

Now, he says, manufacturers are starting to have conversations about how they can support a more flexible health care system that toggles between in-person and virtual settings. But those conversations are still in the early stages.

“On the supplier side, it’s still very much wet concrete,” he said. “On the provider side, they know definitely, they have to provide [virtual] options. They’re running in that direction.”

While big changes to the supply chain may be a ways off, Gillan speculated that telemedicine could encourage medical device manufacturers to orient themselves toward patients directly. That could mean making smaller, more consumer-friendly (possibly even disposable) devices that monitor vital signs from home.

“I think you’re going to see more of those things that ship same-day or next-day to the patient with a return envelope, like the days of the old Netflix when you used to get a DVD at your house,” he said. 

Backstory: The number of telehealth visits was increasing before the start of the coronavirus pandemic. The Vizient survey found the number of telemedicine appointments more than tripled from 2017 through 2019. 

However, virtual appointments still made up a minuscule proportion of total visits.    

At the same time, the number of home health visits has also been increasing rapidly. Home health agencies provide care for patients in their own homes. In most cases, clinicians show up in person to provide care, but they can also use telehealth. 

Medicare spending on home health care more than doubled between 2001 and 2017, according to a report from MedPAC, a committee that advises Congress on Medicare payments.

Medicare spending on home health hit an all-time high in 2019, which Home Health Care News attributed to both an older, sicker population and the preferences of health care providers and patients.

Tim Veach, operations officer of Homehealth and Hospice at Intermountain Healthcare, argued those numbers reflect a growing desire to get more health care at home. 

“That’s where people want to be cared for, so we want to do our best to set up an environment and a situation where they can be cared for in their home,” he told FreightWaves.

As other parts of the health care industry shift their supply chains to serve the increasing number of patients at home, Veach pointed out that home health providers have been at it for years and may have some insight.

“Home care really has developed … expertise, especially in the supply chain space, in getting patients what they need in their home in a timely manner,” he said. “They don’t want to reinvent the wheel. I think some might try to reinvent it, not recognizing that they have an industry that is very capable and ready to help them be successful.”

The pandemic: The pandemic only sped up the transition to providing more health care at home, according to Rami Karjian, CEO of Medically Home, a company that provides a platform that allows health systems to set up virtual hospital beds.

In the past, telehealth was normally used to treat patients with fairly basic needs. In November, the Centers for Medicare and Medicaid Services gave hospitals more flexibility to treat patients with more acute needs at home. 

Providers use a combination of telehealth and in-person visits to treat patients in these virtual beds, and a physician must evaluate patients in person before they’re admitted. 

Over the past year, Medically Home — whose platform launched in 2018 — inked partnerships for hospital-to-home programs with Tufts University Medical Center, Adventist Health, Mayo Clinic and UNC Health.

“COVID catalyzed the growth of hospital-to-home by making hospitals realize how powerful the home was for them, and making patients aware of the type of care they could get in their home,” Karjian told FreightWaves. 

Karjian said supply chain challenges were the main obstacles preventing health care providers from offering hospital-level care to patients at home.

“This high acuity care … required a totally different supply chain that was rapid, that was on demand, that had the same capabilities you’d get in a hospital. That’s what was so hard about building that out,” he said.

In March 2020, Vanderbilt University Medical Center started its own program to send patients with mild cases of COVID-19 back home, instead of keeping them at a hospital. 

By December 2020, the health system had 80 patients in virtual beds and has treated more than 500 hospital patients virtually over the course of the pandemic. 

Later this year, Vanderbilt hopes to expand its hospital-to-home program beyond COVID-19 patients. The hospital system will open up 24 virtual hospital beds per year over the next four years.

“COVID really forced us into doing it in a very sincere manner and very quickly,” Vanderbilt Chief Supply Officer Teresa Dail said during a webinar in March.

To make sure the supply chain could serve these virtual hospital beds, Dail’s team developed pre-built bundles of supplies. For example, someone with congestive heart failure might take home a blood pressure cuff, a stethoscope and a blood oxygen sensor.

“This is definitely the future for health care,” she said. “If you can have very skilled practitioners, remote monitoring, supplies delivered, drugs delivered … I can really see where this is a solution that people are going to gravitate to.”

Yes, but the Vizient survey found that  the specialties with the greatest sustained increase in outpatient telehealth visits were neurology and behavioral health, which require less physical contact and fewer supplies.

In January, 68% of behavioral health appointments and 40% of neurology appointments were delivered virtually.

In contrast, that was true of only 6% of orthopedic appointments and 17% of cardiology appointments.

Gillan said he believes telehealth will best be used as a way to triage patients. While it’s possible to use a small, wearable device to monitor a patient’s heart at home, it’s not the same as a full-blown electrocardiogram in a hospital.

“As you get into more intense things like cardiology, you’ll see increased virtual visits but [the purpose will] be to identify whether it warrants in-person time,” he said. 

What’s next? Virtual doctor’s visits, home health and home hospital programs show no signs of slowing down, and the number of patients who receive care at home is likely to grow.

Based on a survey of patient preferences, Vizient predicts that telehealth visits will continue to rise over the next decade, reaching or surpassing the levels seen in the spring of 2020.

However, Gillan says the increase in telehealth doesn’t mean patients will stop showing up to in-person medical appointments. The future health care system will combine video calls, remote monitoring and in-person visits. 

Dail said future health care supply chains will need to be able to deliver products to patients or providers in all of those settings. Earlier this year she launched a new company under the Vanderbilt umbrella called Carefluent Connect that aims to do just that.

“There were a number of different spaces where we could start plugging the hole … to make sure that no matter where they were seen, or by whom they were seen, that if they had a need, there was one place they could go,” Dail said during a webinar in March. 

Karjian is even more enthusiastic. He said now that many hospitals have set up supply chains that can provide hospital-level care to patients at home, the use cases are only going to expand. 

“The doctors always believed that they could treat a patient remotely. … What they worry about is, if I order that third IV infusion at 11 p.m., is it really going to get there?” he said. “We’ve proven that it can be. … Now, the doctors say there’s so many ways I can use this.”