The Doctor Is In the Zoom: Zicklin Prof Outlines Best Practices for Telehealth
May 28, 2025
The COVID-19 pandemic resulted in many changes, one of which was a sharp increase in the use of telehealth services in medicine. Under ubiquitous lockdowns, patients could not make appointments to see their healthcare providers in person. Yet providers had little incentive to offer virtual appointments, due to low or nonexistent reimbursement by insurance. The eventual result was that Medicare and many states adopted pay-parity policies for telehealth, stating that providers would be reimbursed at the same rate for virtual visits as for traditional office visits. This incentivized providers to offer more virtual appointments.
The introduction of pay parity marked a significant change in healthcare’s business model, and it prompted Professor Alex F. Mills of the Zicklin School’s Narendra Paul Loomba Department of Management to ask some questions. How, he wondered, did pay-parity policies actually affect patients and providers? Were they beneficial to both parties, or only to providers?
Now Mills and his co-author offer the results of their research in a paper, “Telehealth in Acute Care: Pay Parity and Patient Access,” recently published in Manufacturing & Service Operations Management.
One of the stated goals of the pay-parity policy is increased access for patients, Mills notes. But does it really do so?
At first glance, it would seem obviously so; telehealth saves patients the time, expense, and inconvenience of traveling to an in-person visit. If someone is very sick, a face-to-face Zoom call with a doctor from the comfort of one’s bed is more appealing than having to get dressed and leave the house. (Case in point: This writer recently opted for a telehealth consultation with a pediatrician when her daughter came down with a high fever, cough, and chills.) Then there’s the added benefit of not infecting more people.
But there’s a catch. “Medical research has shown that telehealth leads to a higher rate of repeat or ‘duplicate’ visits, meaning that the patient doesn’t get his or her problem resolved in only one visit,” Mills says. “In operations management, this is known as ‘rework’—additional work required to bring a product or service up to par.”
As experts in waiting-time models, Mills and his co-author tackled the incentive problem from that perspective. They showed that in the fee-for-service model that predominates in the American healthcare system, the pay-parity policy means that the doctor might receive more payments despite treating the same number of patients; in fact, it may even decrease the number of patients treated because the duplicate visits generate congestion, leading to increased wait times and discouraging others from making appointments.
Telehealth pay-parity policies encourage doctors to offer more virtual appointments irrespective of the quality of those visits. To borrow another phrase from operations management, this is known as an “incentive alignment problem.”
To solve this dilemma, Mills suggests that policymakers introduce incentives for improving the quality of care: “Did the patient receive an accurate diagnosis? Did the number of duplicate visits decline?” Such incentives are common in hospital care, he notes. “Hospitals have no incentive to readmit patients—in fact, hospitals with high readmission rates are penalized under the Affordable Care Act.”
Mills says many questions remain unanswered about the impact of telehealth on the bottom line for physicians, and on public health. He is currently working with Zicklin doctoral student Omer Berk Olmez to analyze telehealth usage patterns among Medicaid patients seeking mental healthcare.