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Top 4 Reasons Driving The Telemedicine Market at 25.8% CAGR to 2027

December 18, 2020 | Healthcare

The global telemedicine market size was USD 41.6 billion in 2019. The global impact of COVID-19 has been unprecedented and staggering, with telemedicine products and services witnessing a positive demand shock across all regions amid the pandemic. Based on our analysis, the global telemedicine market will exhibit a stellar growth of 91.7% in 2020. The market is projected to grow from USD 79.8 billion in 2020 to USD 396.8 billion in 2027 at a CAGR of 25.8% in 2020-2027. The sudden fall in CAGR is attributable to this market’s demand and growth, returning to pre-pandemic levels once the pandemic is over.


 



 


Key Drivers:


Significant Acceleration in the Adoption of Telemedicine Among Physicians Due to the COVID-19 Pandemic


The pandemic caused a huge decline in the number of patient visits due to the lockdowns and social distancing rules. The huge drop in consultations led to many physicians either closing down or thinking about closing their practice due to the inability to stay afloat.



  • A study published by The Commonwealth Fund found out that there was a 60% decline in outpatient visits in the U.S. during the period of peak disruption

  • In France, there were a 60% decline in specialist consultations and 40% decline in general practitioner (GP) consultations during the lockdown.


The adoption of telemedicine was also driven due to the relaxation of regulations and broadening of coverage for virtual consultations to ensure that physicians are able to provide care to patients during the lockdown.


On March 30, the Centers for Medicare & Medicaid Services (CMS) announced regulatory changes to make it easier for patients in the U.S. to receive medical care through telemedicine services.


All these factors contributed to a huge surge in the number of telemedicine consultations in 2020, especially in the period when there was considerable disruption due to COVID-19.



  • Around 80% of physicians surveyed in UK said that their organization had adopted digital technologies such as telehealth to provide virtual support to patients.

  • CDC saw a 154% increase in telehealth consultations in the last week of March 2020 as compared to the same period in 2019.


Long Wait Time due to Shortage of Physicians or Low Number of Physicians Per Capita


The shortage of physicians results in long waiting times for patients seeking medical care for the diagnosis and treatment of their conditions. In developed countries, the waiting time to see a specialist is quite considerable whereas in some developing countries, access to medical care is hindered due to the low density of physicians.



  • The average wait times for dermatology appointments in the USA is around 32 days with more than 40% of the patients having to wait between 1-6 months

  • In 2019, the average wait time for a GP consultation in The National Health Service of UK was over 2 weeks


Adoption of telemedicine improves patient access to physician care and the adoption is expected to be higher among specialties, where the shortage of physicians is pronounced or among countries with low physician density.


A U.S. study, which was conducted in 2018, found that almost all the patients received a dermatology consultation within 48 hours through teledermatology appointments.


 


Growth in Awareness and Adoption Among Patients


Historically, the awareness and usage of telemedicine services among patients has been low even when telemedicine offers benefits such as lower healthcare costs and improved healthcare access. Over the last few years and before the impact of COVID-19, the adoption of telehealth has been growing at a consistent pace, mainly due to government initiatives to drive adoption and education provided by physicians.



  • The major finding of the ‘Annual European eHealth Survey 2019’ was that provision of telemedicine services was considered as the second biggest eHealth trend by the respondents.

  • A survey conducted by American Well found that 66% of consumers in the U.S. are willing to use telehealth services


Rising Healthcare Costs and Increasing Burden on Healthcare Services Due to Ageing Population and Growth in Prevalence of Chronic Diseases


An aging population and the growing prevalence of chronic conditions are driving huge growth in healthcare spending and the demand for healthcare services in various settings. This is encouraging governments, healthcare systems, health insurance providers, and healthcare facilities to adopt alternate models such as telemedicine to provide patient care and management, to lower cost, and reduce the burden on healthcare systems.



  • WHO estimates that chronic diseases will account for around 73% of deaths and 60% of the disease burden globally.

  • Globally, people aged 65 years and over are projected to more than double from 703 million in 2019 to around 1.5 billion in 2050

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