Is The Telemedicine Boom Over?

In 2001 the Indian Space Research Organisation (ISRO) enabled telephonic medical consultations between a rural hospital in Aragonda and Apollo Hospital in Chennai, setting the stage for what became popular during the Covid-19 pandemic as telemedicine. The contactless teleconsultation facility proved a boon during the pandemic and exploded as a popular mode of seeking medical help over the last four years. Its popularity though, is fast waning, especially for new entrants in the business.

Since the peak of the pandemic, footfalls on telemedicine platforms have fallen considerably, say healthcare industry experts. Among the stand-alone teleconsultation platforms in India that were popular during the pandemic were those of companies like Practo, MeddiBuddy, MFine and Lybrate. According to a 2023 report by Technology, Information Forecasting and Assessment Council (TIFAC), the telemedicine market in India is expected to grow at a compound annual growth rate (CAGR) of 31 per cent for the 2020 - 2025 period and reach a turnover of $5.5 billion. The increasing demand for teleconsultation, telepathology, teleradiology and e-pharmacy have acted as the levers for this growth, the report says.

Industry insiders though, tell a different tale. They believe that for independent players providing teleconsultation services, the growth in business is stabilising now. The post-pandemic fallout of telemedicine has gone in favour of large healthcare providers, who have benefited most in the telemedicine space, they believe. “Overall, directionally when you look at it from a provider perspective, most of the large, organised healthcare providers have seen a positive trend in respect to growth in telemedicine through the pandemic and in the post-pandemic period as well. These groups have started tracking their digitally sourced leads or revenues and that is significantly north of what it used to be earlier,” says Kaustav Ganguli, MD, Alvarez & Marsal India.

He says while there had been a frenzy of remote consultation platforms coming up during the pandemic with an uptick in consultations, the growth has now stabilised for independent teleconsultation companies who have not had a unidirectional traction. “This year we spoke to 25 hospitals in India and we found that telemedicine consultations as a percentage of consultations at the hospitals are roughly around 10 to 25 per cent, not more than that, 25 per cent being the highest in certain hospitals and four per cent being the lowest and an average being 10 per cent. The numbers have plateaued and they have not really grown beyond it,” says Dr Vikram Venkateswaran, Partner, Deloitte India.

*New Business Model

Industry watchers believe that telemedicine needs to reinvent itself to be able to sustain and scale the business in the days ahead, as the prevailing business model does not prove very successful at the present juncture. Industry sources point out that patients look for the physical examination by their physicians. Moreover, teleconsultation applications do not provide any integrated care mechanism that could add significant value to the patients.

Siddharth Srinivasan, CEO, Lupin Digital Health, says that telemedicine needs to go beyond a call between the doctor and the patient and that there has to be value addition to patients to enable them to actually measure their vitals sitting at home. The doctor could then see the results in real time. “One needs to add that value, where patients are being monitored remotely. If they can be diagnosed through algorithms, which then the clinician is able to validate – and a lot of that heavy lifting is being done by technology – then having a virtual connection helps. I think fundamentally it is going to be a hybrid model,” he says.

Srinivasan believes that patients will for emotional reasons want to sit in the doctor's chamber for the first time. A patient anticipating a heart failure would want to get assurance from a doctor, he points out. A patient with oedema on a foot, on the contrary, may not want to visit the doctor every time. All the doctor needs to do in that case is prescribe some medicines.

Teleconsultation platforms are now actively considering diversifying their business, by adding more services to their stand-alone business models. According to Ganguli, independent teleconsultation platforms branching out into other service areas or solutions is not surprising as banking only on consultation-driven revenue models to scale up the business is probably not a very wise idea. Dr K. Ganapathy, Director, Apollo Telemedicine Networking Foundation and Apollo Tele Health, however opines that even though footfalls on telemedicine platforms may have come down in some hospitals and regions of India from the height of the pandemic, he was certain that the deployment of telehealth services had considerably increased since the pre-pandemic era.

* Boon for Hospitals

Experts from the industry believe that hospitals are actively sourcing their patients from their digital platforms, creating unique profiles with patient data and giving personalised services to the patients. Telemedicine, although a small part of their business today, can rein in returns in the long term.

Dr Venkateswaran says that the only organisation providing a care continuum is a hospital today. No other healthcare service is looking at the care continuum, especially in preoperative, operative and post-operative care. He adds that while telemedicine providers have been able to provide online consultations, they are not really an integral part of healthcare services.

Ganguli says that hospitals are not relying on a single patient application to engage with the patient. Instead, they are using a combination of physical interactions, digital outreach, website content, call centres, WhatsApp bots and artificial intelligence (AI) led outreach to ensure that the patient is engaged in the digital funnel and is being advanced through that funnel. “I do believe that overall out-of-hospital patient engagement, consultation and home care will continue to grow for providers as they can keep building on this integrated ecosystem of solutions that will enable both digital patient outreach as well as continued engagement through the patient life cycle,” he says.

According to Dr Ganapathy there is a serious dearth of specialist and super-specialist doctors in India, who are now unevenly distributed in urban and rural areas. “In a study that we carried out five years ago, we showed that 970 million Indians lived in areas where there was not a single neurosurgeon, and therefore it is absolutely essential – and the only way we can provide specialist and super-specialist healthcare – is by using information and communication technology,” he says.

Healthcare industry experts say that startups solving greater problems of diagnosing high-burden diseases in India with the help of artificial intelligence and other evolving technologies will continue to attract attention. The downside is the ongoing funding winter that has hit healthtech more than other sectors. According to a 2023 report by Tracxn, funding in healthtech dipped by 55 per cent in 2022 to $1.4 billion compared to $ 3.2 billion in 2021.

Things are moving slowly, yet steadily in the healthtech space and there is room for innovation for the myriad telemedicine platforms that had provided signal service to a nation in the grips of a pandemic.

The original article was published in BW Businessworld on 22nd December 2023.