Telemedicine is not a new concept. In fact, Medicare has been offering telehealth services to enrollees for years, largely in an effort to cater to a population of older Americans in which mobility issues are prevalent.
But the COVID-19 pandemic has taken the concept of telemedicine to a whole new level, and over the course of the past five months, medical care that would normally be done solely in an office setting has instead been taking place over phone calls and videoconferencing. In April, 43.5% of Medicare primary care visits were provided via telehealth services, compared to less than 1% in February before the public health emergency arose. And telehealth usage outside of Medicare and Medicaid increased 4,347% on a national level between March 2019 and March 2020.
Of course, these days, a lot of people are using telehealth services out of necessity. Those at a higher risk of severe illness from COVID-19 are opting to seek out medical care from the comfort of home rather than expose themselves to fellow patients in physical offices. But now that people have seen how easy, effective, and convenient telemedicine is, there's a good chance they'll continue to utilize these services after the pandemic is over -- even when the thought of sitting in a waiting room isn't panic-inducing.
All of this is good news for patients and medical professionals alike. If mobility issues and access to transportation stop being barriers to healthcare, and getting answers is a simple matter of sitting down at a laptop and pressing a few buttons, people may be more inclined to follow up on their medical issues. And the fact that medical professionals now have an additional way of reaching patients means their revenue might increase.
But all of this begs the question: As telehealth services gain popularity, how will it impact medical offices -- and the people who invest in them?
Real estate investors should brace for some changes
To be clear, telehealth services will never fully replace in-person medical care. (Ever try to remove an appendix over Zoom? It just doesn't work.) But telehealth might change the landscape of medical offices.
Specifically, the demand for larger medical offices or complexes may start to wane as professionals shift to a mix of in-person and remote treatment. And that's something commercial landlords and real estate investors should keep on their radars.
Furthermore, developers may want to scale back their plans to build massive office complexes if they haven't first put out feelers to see what demand will actually look like. It could pay to sink money into smaller offices -- ones with dedicated conference areas where telehealth appointments can take place.
Areas with large senior populations are especially vulnerable to reduced medical office demand as technology makes the process of connecting with doctors less cumbersome. As such, demographics will need to play into investors' decisions as well.
The fact that telemedicine is booming is a good thing. It removes barriers to medical care and makes the process of feeling better easier and less time-consuming. But real estate investors should definitely keep tabs on the extent to which it continues to be utilized in a post-COVID-19 world.