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Category: Healthcare, Net Lease Retail Tags: Healthcare, Medical Office Space, net lease retail, Telehealth

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What is Telehealth?

Telehealth is defined as delivering and facilitating health and health-related services via technology. Typically, people picture a high-definition screen with audio-visual communication and other medical devices to help with physical examinations.


A Brief History

Although telehealth has recently gained traction due to COVID-19, these services date back to 1906 when the telecardiogram, a device used to record patient ECG impulses from a distance, was introduced. Other examples include ships utilizing radios to provide medical advice to passengers on board ships in the 1920s, Alaska using telemedicine due to its remote location, and dermatology and psychology practices employing high usage rates of telehealth in the 1990s.


These examples show that telemedicine is an ancillary part of healthcare and has been an integral part of in-person care in the medical office setting for decades.


Barriers to Entry

For patients, the main barriers to entry are:

  • Internet Access
  • Adaptability to non-physical visits, especially in older demographics
  • Confusion surrounding insurance coverage and costs associated with telehealth services


For physicians, the main barriers are:

  • Licensing requirements to provide multi-state services for out-of-state patients
  • Patient privacy and confidentiality concerns for telemedicine providers at unlicensed facilities
  • Higher likelihood of misdiagnosis and data inaccuracy
  • Strength of provider-patient relationship versus in a physical setting
  • Lack of regulations on telemedicine creates the possibility of medical liability, fraud, and abuse


COVID-19 for self-evident reasons caused a massive acceleration in telehealth, which has been indicated by the strong adoption rates, and a significant increase of investment into the space.


How COVID-19 Accelerated the Adoption of Telehealth

Based on new analysis, telehealth is expected to increase 38 times from the pre-COVID-19 baseline due to patients not wanting to enter facilities where they could encounter other sick patients and
rely on telehealth’s convenience. The healthcare space has experienced immense innovation as the adoption of prescription by mail, drive-thru testing, and internet-based medical visits increased during COVID-19. These past two years of the health crisis have instilled new preferences into people, with telehealth allowing patients to receive care when in-office visits weren’t an option and permitting doctors to stay open and continue practicing. According to American Medical Association, physicians and other health professionals now see 50 to 175 times more patients via telehealth than before the pandemic.


Telehealth’s Overall Impact

With the Centers for Medicare & Medicaid Services (CMS) temporarily allowing more than 80 new services to be conducted via telehealth, consumers’ preferences for telehealth could become more deeply embedded into the care delivery system. The telehealth market is projected to reach $636.38 billion by 2028, at a CAGR of 32.1 percent. The industry has significant momentum, and many practices have implemented telemedicine to some capacity, such as diagnosing, screening, or following up after appointments.


The Top Telehealth Companies to Know

  • Amwell connects patients with doctors over secure video.
  • MDLive is a leading telehealth provider of online and on-demand healthcare delivery services and software. •
  • Doctor on Demand allows patients to book an appointment 24/7, visit a doctor, and get a prescription in the nearest pharmacy.
  • 98point6 delivers on-demand diagnosis and treatment from board-certified physicians via secure in-app messaging.
  • Teladoc utilizes phone or video to talk to a doctor, therapist, or medical expert.
  • GoodRx operates as a free-to-use website and mobile app that tracks perspirations drug coupons for discounts on medications.
  • Healthy.io is a healthcare company offering remote clinical testing and services enabled by smartphone technology.
  • Butterfly Networks transforms complex ultrasounds processes into one connected POCUS system to help offer better, more efficient care.
  • Big Health drives safe and effective non-drug digital alternatives for mental health.
  • AbleTo is a provider of high-quality behavioral healthcare delivered virtually from the comfort, privacy, and convenience of your home.
  • Tia is a hybrid virtual care company dedicated to women’s healthcare.
  • Notable automates every patient encounter and workflow from the front desk to the back office.
  • Sesame Care connects patients with the best doctor or specialist to get quality care at affordable cash prices – without insurance.


Medical Practices Where Telemedicine is Leveraged

The Most

  • Radiologist
  • Psychiatrists
  • Cardiologists
  • Therapists

The Least

  • Allergist/Immunologists
  • Gasteroentroerologists
  • OB/GYN


The Cost

As patients adapt to virtual medical visits or utilize remote monitoring devices, a practitioner’s office will need space and equipment to perform these services. Implementing this infrastructure can cost anywhere from $15,000 to $150,000 depending on size and complexity. Medical office buildings need to consider dedicated telehealth suites with internet, appropriate lighting, computer equipment, and private space. Other costs to consider include expenses associated with licensure requirements between states, reimbursements from insurance companies, medical malpractice liabilities, and privacy compliance which prevent faster and greater adoption.


What Does This Mean for Owners/Operators in the Medical Space?

It’s important to note that despite the rise in telehealth adoption for primary care and monitoring, patients will always need to visit a practitioner’s office for treatments, physical evaluations, and the use of diagnostic equipment. Telehealth should be viewed as a complimentary service to medical office space rather than an absolute necessity. This answers the question many physicians are asking – will telehealth impact in-person medical office foot traffic performance?


Regardless of telehealth’s current impact, the demand for medical office space will continue to rise and change over time. Why? More patients demand faster and more specialized care, ultimately impacting how practitioners provide medical services. Additionally, as the U.S. population grows and ages, the overall demand for healthcare needs will increase.


Miramont Family Medicine has three locations in Colorado and utilizes the ‘Beam Robot,’ a remote-controlled tablet on wheels that navigates throughout the office to see patients at all three locations at once with the assistance of a nurse to take vitals or other procedures.


The Future of Telehealth

It is evident that telehealth is here to stay. Although telemedicine is a broad umbrella, encompassing AI, streaming capabilities, remote devices, and various other complexities of care, it acts as a supplement to face-to-face care by providers. Physicians will adapt space within their suites to conduct in-person and telehealth visits, with outfitted technology in a dedicated space. In the future, we may start seeing tenant improvement allowances specific to the implementation of telemedicine services.


As a result of this combined effort, telehealth will increase touch points with patients and improve access to providers, thereby increasing patient retention. For example, telehealth will help landlords with offices in rural areas or offices further from the main road to promote their capabilities via technology, helping these practices maintain a more extensive client base.


In effect, the industry is implementing an omnichannel approach to serving communities. Rather than serving as a threat to the industry, telehealth is a complimentary asset. It’s essential to ensure the health of the practice by paying attention and dedicating time to providing a medical office that has the proper infrastructure (internet connections, interface devices, lighting/sound, etc.), is in an optimal location, staffed appropriately, and meets regulations (reimbursements, license, HIPAA compliance, etc.).

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