Teladoc expands Primary360 platform as telehealth use drops across the US

The news: Teladoc expanded its virtual primary care platform (Primary 360) to give members better access to more convenient care.

  • Primary360 members will now receive health plan in-network referrals, same-day medication delivery with digital pharmacy Capsule, and on-demand, at-home blood draws with Scarlet Health, per a press release.

Why now? The telehealth giant is likely trying to boost consumer retention and acquisition to recoup the record-high losses it reported earlier this year.

Teladoc reported a total net loss of $6.6 billion in Q1 and a “goodwill impairment charge” of $6.6 billion. Stakeholders allege they are now suffering “significant losses and damages” because of the charge.

  • The company attributed its Q1 losses to high advertising costs and smaller competitors eating up market share.
  • During Teladoc’s April earnings call, CEO Jason Gorevic attributed about three-quarters of the revenue outlook decrease to Teladoc’s BetterHelp business, which sucked in higher marketing spend but delivered lower-than-expected returns.

The larger trend: Telehealth use is declining overall, and that likely won’t change as the urgency around COVID-19 fades and states repeal pandemic-era virtual care policies.

US adults’ telehealth use (measured by medical claim lines) decreased 6.1% in March alone, per nonprofit Fair Health. Researchers attributed the drop in telehealth use to the falling COVID-19 cases that month. That could have led more people to tap in-person healthcare visits.

And many states, like Alabama and Illinois, peeled back their pandemic-era telehealth policies. That means many out-of-state physicians will no longer be able to conduct telehealth visits without state-specific licenses.

  • This could pose a staffing problem for telehealth vendors like Teladoc in certain states. Teladoc relies on its national network of physicians to offer virtual primary care to members across the US.