Optum Virtual Care said to be closing down

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On an April 18 conference call with Optum Everycare CEO Jennifer Phalen, some employees of the company’s virtual care division were told that their last date would be in July, according to a news report this week.

WHY IT MATTERS

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UnitedHealth Group, Optum’s parent company, reported more than $1 billion in net losses during the first quarter – which included impacts from the February 21 Change Healthcare ransomware attack and subsequent payment systems outage.

Optum’s provider business employs and affiliates with about 90,000 physicians, according to Endpoints News, which spoke to three individuals who were on the conference call with Phalen and discussed the pending shutdown.

This month, one physician and IT entrepreneur posted on his Substack other unconfirmed reports that suggested Optum was ending its telehealth service – and asked whether brick-and-mortar healthcare had the capacity to replace Optum’s millions of virtual visits.

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Supported in large part by Optum technology, UHG facilitated more than 33 million telehealth visits in 2020, up from 1.2 million in 2019. It was a 2,500% year-over-year increase, Kristi Henderson, a former Optum senior vice president for digital transformation and CEO of Optum Virtual Care, who is now chief executive officer of Confluent Health, has said.

In a 2021 piece she authored on Optum.com, she noted that digital health tools enabled more connected experiences, complementing the standard approach to care, and that hybrid system “expands consumers’ choice and convenience while increasing engagement and access to care,” she said.

THE LARGER TREND

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In December, Steven Ullman, director at the Center for Health Management and Policy at the University of Miami, said that telehealth utilization dropped to 5.4% of medical claims since use skyrocketed during the pandemic.

However, adoption of virtual primary care and hybrid care models is projected to grow this year, according to Jon Salon, president of MDLive, an Evernorth Company, a virtual healthcare delivery services vendor. 

“As employers continue to roll out plans to bring employees back to the office at least some of the time, they are looking for ways to provide more support for employees’ physical, mental and emotional health – both in-person while at the office, and through digital tools and virtual care,” he told Healthcare IT News in January.

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Meanwhile, Optum has been focused on reconnecting Change Healthcare’s systems. On Monday, UHG reported in its latest update that pharmacy services and medical claims are back to near-normal levels. The company also said that a substantial portion of Americans’ protected data had been stolen in the cyberattack. 

Despite states and others that stepped in to help providers crippled by a lack of payments and Medicare reimbursements, the extended outage threatened the sustainability of small physician practices across the country. Data collected for the American Medical Association from March 26 to April 3 indicated looming closures of practices of 10 physicians or less. 

ON THE RECORD

“Virtual care has been and will continue to be a core part of our comprehensive, integrated care delivery model designed to provide care to people where, when and how they prefer,” a spokesperson for UnitedHealth said by email Friday.

“As an enterprise, we are committed to providing patients with a robust network of providers for virtual urgent, primary and specialty care options. We continually review the capabilities and services we offer to meet the growing and evolving needs of our businesses and the people we serve,” they continued. 

“As always, we will support affected team members with job placement resources and seek to deploy them where possible to any open roles within the company.”

Andrea Fox is senior editor of Healthcare IT News.
Email: afox@himss.org

Healthcare IT News is a HIMSS Media publication.



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