Keeping telehealth profitable

Telehealth can absolutely make money for a practice, but it usually stops being profitable when it’s treated like a convenient add-on instead of a real service line. The clinics that do well tend to be the ones that define what telehealth is for, build a repeatable workflow around it and stay on top of payer rules that keep changing. If you want a quick “are we doing this right?” gut check, this Physicians Practice piece is a helpful framing device: “Video visits versus virtual care”.

What does “profitable telehealth” actually mean?

In plain terms, you’re collecting more money than it costs to deliver the visit once you account for clinician time, staff support, platform fees, documentation, billing work and the follow-up tasks that can pile up after a virtual encounter. Practices often think the math is working because visit volume is strong, then discover their margin is being quietly eaten by extra “shadow work,” like tech troubleshooting, last-second conversions, and denials tied to small billing details. If that’s your reality, it’s usually worth revisiting the basics and making sure everyone in the practice is playing by the same rules. Physicians Practice has a useful refresher in “Untangling telehealth billing”, and for coding mechanics that come up in real workflows, “Coding for telemedicine visits” can help align staff and clinicians.

Which kinds of telehealth are usually easiest to sustain financially?

The visits that tend to work best are the ones that are predictable, protocol-friendly and clearly appropriate for virtual care. Think follow-ups, medication management, stable chronic care check-ins, and straightforward acute complaints where your clinicians feel confident that a virtual visit is safe and sufficient. Profitability also improves when practices stop treating telehealth as the default “overflow” and instead treat it as a planned option with guardrails.

It’s also worth remembering that some services adjacent to telehealth can support both access and revenue when handled carefully. Patient portal-based e-visits, for example, can be a meaningful part of the mix, but they only help if the documentation matches what you’re billing and the workflow is designed to keep it efficient. Physicians Practice gets into the practical “do this, not that” details in “How to correctly document and bill for patient e-visits”. Remote patient monitoring can be another revenue stream, but it’s also an area where compliance mistakes can erase gains quickly, which is why this Physicians Practice piece is worth keeping on your radar: “Remote patient monitoring under scrutiny: Top compliance mistakes to know”.

What Medicare rules should we watch right now?

If Medicare is a meaningful slice of your payer mix, it helps to keep a short list of “source of truth” pages bookmarked, because the fastest way to lose profitability is to bill confidently under an assumption that is no longer true. CMS maintains the Medicare List of Telehealth Services, which is a practical anchor when you’re trying to confirm whether something is actually considered a Medicare telehealth service. CMS also publishes an updated Telehealth FAQ (CY 2026) that addresses operational questions practices routinely run into. If you want the broader policy lens, CMS’ CY 2026 Physician Fee Schedule final rule fact sheet is a good high-level map of what’s changing and why. It can also help to keep an eye on HHS’ running resource page, Telehealth policy updates, especially when you’re trying to understand whether something is permanent, temporary or simply extended again.

Physicians Practice’s Medicare coverage can be useful context for how these rules evolved and why practices sometimes get tripped up by old habits. For example, “Meeting Medicare requirements to report telehealth services” is still a helpful operational explainer, and “Changes to Medicare telehealth services for CY 2024” can help teams understand how quickly the definitions and lists can shift.

Why do commercial payer rules make telehealth profitability feel unpredictable?

Because commercial coverage and payment policies vary across states, across insurers and even across different plans under the same insurer. That’s why a practice can run the same visit the same way and get paid differently depending on who the patient’s coverage is with. One of the most practical ways to control that chaos is to build and maintain a simple internal “telehealth payer grid” that spells out what each major payer expects in terms of eligible modalities, place-of-service rules, modifiers and any odd documentation requirements. The state-level view is well captured in the Center for Connected Health Policy’s scan, State Telehealth Laws and Reimbursement Policies Report (Fall 2025), and MGMA has also discussed the uncertainty practices have navigated as the so-called telehealth cliff has softened, including in “Bridging strategic uncertainty as the ‘telehealth cliff’ is replaced by firm ground”.

Where do practices usually lose money on telehealth?

Not always in the reimbursement rate itself. More often, the margin gets chewed up by friction. A telehealth program that looks fine on paper can become expensive when the process is inconsistent, when no-shows are high, when staff are constantly converting visits because patients can’t get connected, or when documentation and billing aren’t standardized. That’s why telehealth profitability is oddly tied to basic access operations. If your schedule is leaking appointments through cancellations and empty slots, it’s hard to make any visit type financially strong. Physicians Practice has a business-minded take on the revenue impact of cancellations in “Turning patient cancellations into revenue”, and a broader access angle in “Patient access myths specialty practices should ditch today”. Even older process stories can be useful as operational models; for example, “Atrius Health deploys home-based Covid-19 triage call center” is a reminder that tight triage rules and clean routing matter when you’re trying to protect both clinician time and revenue.

What compliance issue can blow up telehealth profitability the fastest?

Audit risk, repayments and enforcement actions. Telehealth has been a persistent area of interest for regulators, and the financial downside comes quickly when documentation doesn’t support what was billed or when a practice’s policies don’t match what payers and regulators expect. Physicians Practice has covered the post-pandemic landscape and fraud concerns in “Examining post-pandemic telehealth fraud risks”. Privacy and security also remain foundational; Physicians Practice walks through practical risk considerations in “Managing the risks of telemedicine”, while HHS offers the official baseline in HIPAA and Telehealth.

What if our clinicians prescribe controlled substances via telemedicine?

That’s an area where you want to be extra disciplined because federal policy has been evolving and extensions have been issued. A good habit is to keep an eye on primary sources as they’re released, such as this DEA press release and the associated Federal Register notice. For operations, the key is having a written internal policy that addresses identity verification, licensure, PDMP checks, documentation expectations and follow-up rules, then training staff and auditing your own work so you catch problems before someone else does.

What should we watch each month to know if telehealth is really paying off?

Keep the dashboard simple enough that it actually gets reviewed. Practices typically learn the most from tracking no-show rate for virtual visits, denial rate for telehealth claims, the lag between the visit and claim submission, net collection rate and how many staff “touches” it takes to get a telehealth visit from scheduling to a clean claim. If you want broader workflow thinking that ties into telehealth, Physicians Practice’s Physician Productivity hub can be a useful companion.

What’s the quickest way to improve telehealth margin without a giant project?

Look for one recurring point of friction and fix it quickly. Sometimes that’s tightening your visit types so telehealth isn’t the default dumping ground for anything “quick.” Sometimes it’s standardizing documentation so coding and billing are consistent. Sometimes it’s addressing cancellations and empty slots so the schedule stops leaking revenue. And sometimes it’s a compliance sweep of your platform, vendor contracts and policies so you’re not building growth on top of shaky risk assumptions.

Telehealth doesn’t have to be a margin killer. But it also can’t be treated like an informal convenience that lives inside your schedule. The practices that keep it profitable are the ones that make the work predictable, the billing repeatable and the risk manageable.