I’ll be honest. I’m a bit of a hypochondriac.
Maybe not according to the clinical definition, but I’ve never been hesitant to go to a doctor or urgent care if I’m concerned about something.
I was saying long before the pandemic that the way we visit doctors is dated.
Who wants to sit in a crowded waiting room with people coughing on you?
Who wants to take a half day off work only to be told to go home, pick up antibiotics on the way, and then rest?
Up until early last year, this was the typical visit. But COVID-19 shined a light on this non-ideal system and gave us a glimpse of what the “new normal” will be.
And now, proposed legislation could further this “revolution” and the opportunity for smart investors…
Telemedicine has been around a while. It’s a hypergrowth mega-trend I’ve followed for years.
The ability to see your doctor via your phone or computer has always been convenient, but the pandemic thrust this industry into the spotlight. It went from a convenience to a necessity, and there is no putting the telehealth genie back in the bottle.
A study from Health Affairs found that 30% of all doctor visits during the pandemic were telehealth visits. Weekly telehealth visits soared 23X from 16,540 to nearly 400,000.
Not surprisingly, younger age groups were more comfortable with telehealth and took advantage of it in greater numbers. Of those 65 and older, 23.7% of visits were done remotely And that number jumped to 38.7% among those 30 to 39.
Some investors seem to think telehealth has peaked – at least based on what stocks have done. The leader, Teladoc (NASDAQ:TDOC), surged nearly 250% from the beginning of 2020 until its recent peak in February. And since then, it’s been cut nearly in half.
I see Teladoc as one of the most misunderstood stocks in the market for its size ($24 billion market cap). Telehealth is the future of healthcare – not a one-time fix during the pandemic. But as is so often the case, a lot of folks are having trouble looking past the immediate term.
Growth may not be as massive as it was in 2020, but that’s to be expected. Plus, management raised guidance for the rest of this year in the first-quarter earnings report. Revenue forecasts were boosted to $1.97-$20.02 billion, and projected total visits increased from 12-13 million to 12.5-13.5 million. The number of visits continues to trend higher.
And just this week, we got some interesting news that highlights one of the overlooked opportunities in telehealth – getting quality medical care to less populated rural areas.
Before the pandemic, regulations made it surprisingly difficult for a lot of people to receive telehealth. For example, doctors and nurses were not allowed to provide telehealth services to Medicare patients in urban and suburban communities. And… patients couldn’t talk to their doctors when the doctor was home.
Restrictions were lifted during the pandemic, and guess what happened? The number of Medicare patients who received telehealth visits blew through the roof – from 134,000 before the pandemic to 10.1 million in 2020… a 75X increase!
This week, a bipartisan group of senators led by Senator Joe Manchin (D-W.V.), introduced the Protecting Rural Telehealth Access Act. The Hill headline says it “paves [the] way for a telehealth revolution.”
The bill permanently removes the telehealth restrictions that were lifted temporarily during the pandemic. That opens up multiple avenues of growth.
For one, more than 60 million people are Medicare beneficiaries… and that number will get larger as the population ages. Of those, one in four live in rural areas that suffer from a lack of available care, according to The Hill article.
It’s important to know that telemedicine isn’t just talking to your doctor on a screen. Rural emergency rooms can use telehealth to connect with a team of doctors from a remote facility, who can both monitor patients and provide medical services.
Patients can also be monitored using telehealth after they are discharged. The Cleveland Clinic did just that with COVID-19 patients after they were sent home.
As the breakthrough 5G network rolls out – and opens up huge investment opportunities – remote capabilities will expand dramatically.
And think beyond traditional medical services. One of the largest and most influential companies in the world has been quietly moving into telemedicine. In fact, I believe Apple (NASDAQ:AAPL) will be considered a healthcare company first and foremost within the next 10 years.
Apple’s healthcare division is expected to generate $313 billion in revenue by 2027. A lot of this has to do with its popular Apple Watch. The watch and its health tracking features received FDA approval in 2018, and since then the device has been being incorporated into healthcare plans and major medical facilities.
I believe the Apple Watch will eventually turn into an early detection medical device that can relay important data to your doctor. (Here again, 5G changes the game.) It can already track your heartbeat and conduct an electrocardiogram (EKG), which will alert you if your heart rhythm is abnormal and potentially save lives. I wear my Apple Watch every day.
Telemedicine is also increasingly recognized by the insurance industry, which is critical for any healthcare breakthrough.
Add it all up and everything points to massive growth in telemedicine in the coming years. Teladoc is the big player, but there are other emerging opportunities as well.
Matthew McCall left Wall Street to actually help investors — by getting them into the world’s biggest, most revolutionary trends BEFORE anyone else. Click here to see what Matt has up his sleeve now.