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Can using telemedicine save you on healthcare costs?

Without a doubt, the popularity of telemedicine services — virtual visits patients conduct with healthcare providers via video chat, phone call, or even email — is on the rise. One recent study from consulting firm McKinsey & Company shows that in April 2020, telehealth use was 78 times higher than in February 2020 and currently represents between 13 and 17 percent of all health consultations.

There are many reasons why telemedicine is gaining in popularity, not the least of which is the fact that it has made a lot of sense to use during the pandemic, when in-person interactions can present a level of risk, particularly for people in high-risk groups. Ward Svarvari, a vice president and healthcare relationship executive at Commerce Bank, says changes in regulations also contributed to this increased adoption.

“Prior to the pandemic, certain regulations made it difficult for physicians to broadly offer telemedicine services,” Svarvari says. “These restrictions were lifted during the pandemic to help physicians treat patients without needing to see them in person. I would guess that COVID-19 accelerated the adoption of telemedicine by about five years.”

What makes telemedicine visits so appealing is not only the convenience they offer the patient, but also the reduced costs for both the patient and provider, as they are typically less expensive than an office visit. A study from the journal Health Affairs found that a telemedicine visit costs an average of $79, while an office visit averages $146. It’s important to note that these are out-of-pocket prices; as Svarvari points out, the difference between copays may be less, if they’re different at all. “Your insurance may make the copay for any visit the same amount, whether it’s virtual or in-person,” he says. “If you’re paying out of pocket, however, there are certain scenarios when a virtual visit can provide the same outcome for a much lower out-of-pocket cost. In that case, telemedicine is very likely to be your better option.”

The Health Affairs study notes that another factor to consider is how often one uses telemedicine. Because virtual visits are more convenient, it’s possible that people will use them more freely than they would an in-office visit. If so, while per-visit costs would come down, more visits per year could cause your total costs to go up.

Whether or not people truly are seeing doctors more frequently due to an uptick in telemedicine usage is unclear. The study reported that as many as 88 percent of telemedicine visits represented new utilization — in other words, they represent visits that people would not have made if telehealth were not an option. On the other hand, Teladoc, a telehealth services operator, reports that only 13 percent of their visits represent new medical use.

“Regardless of how frequently you use it, having access to telemedicine makes visiting a doctor much easier — you don’t have to worry about transportation, childcare, or the extra time spent driving to and from a physician’s office,” says Svarvari. He adds that if you are interested in finding out more about the costs of telemedicine and whether it’s available to you as an option, the best place to start is with your insurance provider.

“Some health plans cover telehealth visits and some don’t, so it’s important to ask,” Svarvari says. “They can tell you what’s available. There are also options for telemedicine available through pharmacy chains and urgent care facilities, so you could also contact them or go to their websites to learn more.”

In short, telemedicine provides an excellent option to potentially save money on medical costs, particularly if you have a minor issue or one that doesn’t require you to be treated in person. It can even be used for specialties such as mental health or for sharing lab results.

“Telemedicine obviously can’t be used for every medical situation,” says Svarvari, “but if you can use it, the convenience and potential cost savings are worth looking into.”


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