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Telemedicine Makes The Living Room The Next Frontier For Healthcare Real Estate

Urgent and ambulatory care facilities are driving patient traffic away from main hospital campuses and into retail centers, but even the two burgeoning sectors in healthcare treatment aren’t immune to disruption. 

Ennead principal David Tepper, Steward Health Care System Executive Vice President of the Northeast Hospital Region Dr. Mark Girard, Boston Medical Center Director of Ambulatory Operations Pamela Nettles-Gomez, PhysicianOne Urgent Care Chief Medical Officer and co-founder Dr. Jeannie M. Kenkare and WSP Senior Vice President and Healthcare Practice Lead Gary Hamilton

The number of Massachusetts urgent care clinics grew from 18 to 145 between 2010 and 2018. Retail clinics, which are usually just staffed with nurse practitioners, went from 20 to 54 in the same period. The migration of treatment away from a main hospital is cost-effective as urgent care visits typically cost $150, with patients getting a $33 copay, according to the Massachusetts Health Policy Commission. Hospital emergency room visits typically cost just shy of $900. 

But panelists at Bisnow’s National Healthcare New England event Thursday said patients want even more convenience than an urgent care center down the road from their home. 

“We’re all in for a rude awakening,” Boston Medical Center Director of Ambulatory Operations Pamela Nettles-Gomez said. “Even if there is an urgent care center within 2 miles or closer, what I’m seeing with patients and my own friends is they are starting to get their care on a phone through an app. That’s a huge disrupter, and it’s not easy to compete with.”

Tsoi Kobus Design Senior Principal Richard Kobus, Partners HealthCare Vice President of Connected Health Dr. Joseph Kvedar, Massachusetts General Hospital Principle Investigator and Aetna Foundation Innovation Fellow Dr. Jocelyn Carter, Boston Children's Hospital Executive Director of Innovation and Operational Effectiveness Dr. Carla Small, Atrius Health Chief Transformation Officer Dr. Christopher Andreoli

Improved technology and an era where most patients have access to a smartphone are moving treatments out of the exam room and into one’s living room. 

Telemedicine, when a doctor treats a patient via video conference or even just photos, is increasingly offered in everything from dermatology to psychiatry. Patients can reach a doctor within minutes, get treated and have a prescription to a pharmacy without having to leave the couch. 

Doctors Without Borders now utilizes telemedicine from remote locations to get second opinions from doctors in its global network. 

North America is a leading market for telemedicine, which has a current market value of nearly $7B, according to a report released Tuesday by Persistence Market Research. That number is expected to increase more than fivefold in the next 10 years , as 68% of U.S. physicians said they were strongly inclined to utilize remote patient monitoring and telemedicine in the future. 

“We’re all working on trying to get up to speed with other industries in terms of technology and our own telestrategies,” Nettles-Gomez said.

Boston Children's Hospital Executive Vice President of Health Affairs and Chief Operating Officer Dr. Kevin Churchwell, Mount Auburn Cambridge President and Chairman Dr. Barbara Spivak and Beth Israel Lahey Health Chief Strategy Officer Dr. Stanley Lewis

The Steward Health Care System, the largest private hospital operator in the U.S., utilizes telemedicine in a variety of ways both on and off hospital campuses, which include St. Elizabeth’s Medical Center in Brighton and Norwood Hospital. 

Intensive care unit patients are telemonitored from a center in Westwood, according to Steward Executive Vice President of the Northeast Hospital Region Dr. Mark Girard. The practice has helped reduce lengths of stay in the ICU as well as a decrease in morbidity and mortality rates. 

“The telepresence in the ICU has been very comforting to the patients,” Girard said. “It takes a little getting used to the monitor, but they are very comforted they are being monitored by a doctor 24/7, 365.”

Steward also utilizes telehealth as a care management tool and to integrate behavioral health and physical health services. Since access to behavioral or mental health services is often difficult, Girard said payment providers incentivize healthcare providers to offer treatment any way they can, including telemedicine in lieu of in-person visits. 

The telemedicine shift is also having an impact on the economics of primary care physician practices. 

“Primary care physicians typically made their income on the quick and easy visits that supplemented the hourlong visits they spent with their chronic care patients, where they get paid maybe twice as much as they would on a sore throat where they spend five minutes,” Mount Auburn Cambridge President and Chairman Dr. Barbara Spivak said.

Beth Israel Lahey Health Chief Strategy Officer Dr. Stanley Lewis, Brigham and Women’s Faulkner Hospital President David McCready and McDermott Will & Emery partner Charles Buck

Quick visits were a key part of a primary care physician’s business model, but now those are being siphoned away by urgent care centers and, more recently, telemedicine providers. 

Spivak expects primary care physicians to adapt in coming years by dealing primarily with chronic care conditions. That has real estate ramifications, as exam rooms will need to be larger and wheelchair-accessible. 

While the tech disruption is almost certain to have further physical impact on U.S. healthcare, panelists at last week's event still didn’t expect a complete brick-and-mortar death when it comes to getting treated for an ailment. 

“I think there will still be plenty of bricks-and-mortar, but what those facilities will look like will change dramatically,” Brigham and Women’s Faulkner Hospital President David McCready said.