The dark side of telehealth: Concerns about increasing commercialization of medicine

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An itchy tattoo. Trouble sleeping. Motion sickness. Cold sores. Anxiety.

Patients suffering from these conditions and many more can likely seek treatment without leaving the comfort of their couch, thanks to the rise in telehealth. (Shoutout to the dermatologist who saved me from scratching off my tattoo.)

However, telehealth is often about more than making it easier to talk to a doctor. According to Katie Palmer, a health tech correspondent with STAT, the industry realized it could make more money marketing drugs and handling cash payments than from patient care. The subsequent shift has raised concerns about the commercialization of medicine.

Here & Now’s Rob Schmitz spoke to Palmer about the evolution of telehealth, the consumerization of medicine and how the model could drive up health care costs overall.

Here are some highlights from the conversation, edited for length and clarity:

How has telehealth evolved over the years?

“ Before the pandemic, telehealth companies existed, but they were having a hard time making money off of providing care. Insurance barely reimbursed for virtual care, and it was relatively little-used. So startups before the pandemic, around 2017, a little bit before, started to realize they could make a business out of marketing cash pay services and drugs, the products, directly to patients instead of the care. And then the pandemic obviously gave that industry a huge shot in the arm. Venture capital poured into these kinds of companies. Once telehealth became something that everybody needed, all of a sudden use just went through the roof.”

Are doctors involved in the process?

“ Yes. In the very early stages of these kinds of companies, you'd have rogue online pharmacies where you could get drugs without a prescription. But in all of these cases, you've got providers — whether it's nurse practitioners or doctors or physician assistants — doing the prescribing behind the scenes.”

 Do they work for the companies that are making the profits off of this

“So technically, they have to work for a different entity. So the telehealth company that you'll see marketing the drugs is a marketing business, essentially. And to comply with corporate practice and medicine laws, the medical groups that actually employ the doctors and the prescribers have to be separate entities that sort of contract with the telehealth brands. So those medical groups are always owned by doctors and that's how they have to comply with laws.”

 Doctors are licensed within a state. How does that work on a national kind of platform?

“Your doctor needs to be licensed in the state where you, the patient, are physically located. So for telehealth companies, it becomes really valuable to have doctors licensed in multiple states so they can see patients in as many different places as possible.”

What are some of the potential risks with this model?

“[The risks] really run in parallel with the concerns around direct-to-consumer advertising in general for any drug. Anytime you have a medical interaction that's mediated by an ad, you run the risk of a patient getting a drug that happens to be well- marketed instead of the drug or the care that is best for them.

“And then, at a broader societal level, you worry that that kind of prescription could potentially drive up overall health care costs in a way that is detrimental to all of our care and health care costs.”

 Are insurance companies involved in any of this?

“Most of the companies that I'm talking about, these so-called direct- to- consumer telehealth companies, operate exclusively in cash. And that means they don't accept any kind of insurance, and it's just a relationship with the patient paying cash.”

 Have regulators kept up with how quickly this market is growing?

“What is evolving potentially a little bit right now is this gray area in the regulation of marketing, which is usually done by the [Food and Drug Administration] for branded drugs., Bbut because these telehealth companies aren't the drug makers, they don't necessarily fall into the same regulations that traditionally would apply to what you think of as drug ads. So we recently saw the FDA issue, a bunch of warning letters to telehealth companies for the way that they’re marketing compounded drugs specifically. So there's definitely some movement, but it's still a really big gray area. And I'd say some people would call it a loophole in the drug ad regulations.”

 How are they able to sell drugs that are not FDA approved?

“Compounding has existed for a long time. Usually compounding is used to help people get access to medications when FDA approved drugs don't work for them. So, a traditional example is you give a kid a version of a drug in liquid form as opposed to a tablet because they can't swallow a pill. And you can also use compounded drugs in the event of a shortage, which is what we saw with the GLP-1 drugs.

“What's happened with these telehealth partnerships though, is that access to compounded drugs has just been like expanded into this mass market through partnerships between compounding pharmacies and telehealth companies, marketing those drugs specifically.”

Many of the experts that you spoke to raised concerns that this shift into selling drugs directly to consumers is driving a disturbing commercialization of medicine. How do people in the medical field expect this to change health care in the U.S.? 

“Pretty uniformly among the physicians that I speak to, whether they work in telehealth or in more traditional care settings, kind of just see this as the way of the future, for good and for bad. There are definite advantages to making it easier for patients to get access to the drugs that they want, which may include the drugs that they need. We've all come to expect speed and efficiency with the internet and the way that e-commerce has grown alongside it. And it basically seems like there's no turning back the clock to a lot of people.”