America’s Provider Shortage: Can Digital Health Resuscitate Our Broken Care Delivery System?
Have you ever wondered why it takes so long to schedule an appointment with your primary care provider? Or why wait times for specialists — from OB-GYNs to psychiatrists, to gastroenterologists or dermatologists — can take upwards of weeks if not months in many cases. You are not alone. The system has made it far too difficult for the American population to quickly get the care they need.
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Individuals across the country, from the densest metropolitan cities to the most modestly populated rural towns, are facing the ever-growing and sobering reality of a looming systemic healthcare crisis that has been fomenting for decades. Today, consumers in the top 15 metropolitan cities are waiting an average of 24 days for an appointment with a provider. In some cities, the situation is far worse. Patients in Philadelphia, for example, attempting to schedule their first dermatology appointment are shockingly better off traveling to neighboring cities than waiting an average of 78 days to be treated by a dermatologist in their own city. These shortages are more profound in rural areas where the ratio of primary care doctors to patients often exceeds 1: 3,500.
What is driving these insurmountable wait times and prohibiting Americans from accessing healthcare? The simple answer is that there is a widespread and climbing provider shortage. Unfortunately, the future looks bleak as the provider supply is on path to dwindle even further over the next decade. By 2033, the Association of American Medical Colleges projects that the shortage will climb to 139K providers.
There are three root causes that are driving the stark supply and demand mismatch. First, there is an insufficient number of medical residency spots for medical students to support the growing health needs of the U.S. population. Even fewer are entering into much needed fields like primary care, instead choosing to pursue careers in higher paying specialties to pay off mounting medical school debts. Second, the country’s grey tsunami, describing massive and growing aging population, requires more high-touch, intensive care from their provider, increasing demands on providers’ already limited capacity. The number of Americans 65+ will grow by around 50%, reaching 80 million in 2040. Today, individuals over 65 visit their physician five times per year, nearly twice as often as the country’s average. Finally, burnt-out physicians are exiting the workforce at unprecedented rates beyond what experts had anticipated.
Unfortunately, the supply and demand imbalance is only expected to worsen and as a result, millions across the nation will face meaningful barriers to accessing basic care. Compounding these challenges is the fact that almost half of all active physicians will reach retirement age within the next decade and many are choosing to retire early because of burnout. Consequentially, people are frustrated and are hoping for a superior experience from the healthcare system. Patients are transforming into health consumers and expecting the same convenient, on-demand experience in healthcare that they receive in other facets of their life. Something must shift.
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Accelerated virtual care innovation, a silver lining of the pandemic
The pandemic had a massive impact on user adoption of virtual care, with nearly two-thirds of consumers reporting using telemedicine in 2020, a tremendous step-up from pre-pandemic levels of only 11%. Fueled by the expanding userbase, virtual care solutions are raising unprecedented funding to accelerate growth and subsequently, increasing provider demand. Not only are consumers demanding virtual care, but providers too are leaning in. Today, 70% of providers are motivated to deliver care virtually.
Although Covid-19 excruciatingly amplified the provider shortage, the pandemic catapulted digital health into the forefront of being part of the solution. Digital health solutions can enable provider scalability by allowing physicians to monitor and treat their patients more efficiently and remotely, in many cases without requiring a face-to-face visit. Likewise, virtual care solutions can distribute provider supply more equitably across geographies and improve access to care for markets with heightened shortages.
As consumers continue to expect excellence, the market is demanding that digital health solutions deliver lower-cost care in a more seamless and integrated manner, forcing companies to think creatively or face the consequences of becoming antiquated.
Drowning in demand, virtual care solutions are forcing the supply curve to shift
The skyrocketing demand for virtual care solutions is fueling new supply needs in the market to service the growing consumer userbase. As a result, maturing virtual care companies, bolstered with fresh pools of capital, are rapidly hiring providers, and squeezing the shortage even further. Some digital health solutions however are implementing tactics to leverage their care supply creatively and causing a broader market shift in the supply curve.
Will virtual care delivery alone solve the provider shortage? Not entirely, but digital health will be a catalyst in transforming care such that MDs can focus on the most complex cases and practice at the top of their licensures. In this shift to satiate demand with limited supply, digital health companies can pull on several levers to drive this shift.
Expanding Providers’ Geographic Footprint to Serve Areas with Care Shortages
In the early days of the pandemic, several regulatory barriers were removed, including restrictions for practicing across state lines. While the permanence of this change is unclear and some states have started to rollback their temporary waivers, this legislation brought about innovation as several virtual care companies built clinical networks with providers licensed in multiple states. Scaling the geographic footprint of networks can balance provider supply and demand, especially for underserved areas such as rural communities. Companies like NOCD, a virtual behavioral health platform for consumers battling severe mental illness focused on obsessive compulsive disorder, have developed a robust clinical network of specialists with the capacity to service members across all 50 states. Similarly, companies like Nurx and Hims offer a robust network of providers to enable on-demand access to prescriptions for birth control, anxiety and depression medications, and now, visits for primary care conditions in multiple markets. Across these companies, many of the clinicians are cross licensed in multiple states, further expanding their capacity to deliver care to a broader geographic population.
Optimizing the Utilization of Mid-Level Clinicians
While there are several conditions where clinical training of an MD is required, for several low acuity cases, mid-level providers, such as Physician Assistants, RNs, and NPs are particularly well-suited to deliver care. As a result, several digital health companies like Wheel are optimizing mid-level care teams as a first line of defense for screenings, vaccinations, and non-emergency urgent care cases. Other companies in specialty care like Oshi are leveraging mid-level providers to deliver low-cost, high-quality care to address more routine gastrointestinal cases, while leveraging specialists for only the most complex cases. Additionally, players such as Mood Health and Brightside are leveraging Nurse Practitioners to deliver low-cost, high-quality longitudinal psychiatrist care, from medication management to long-term care plan development. Finally, the newly merged Ginger and Headspace organization, now Headspace Health, is another example where the company optimally assesses and stratifies a consumer’s level of need and then matches a consumer with either a coach, therapist, psychiatrist, or self-management solutions (for sleep, anxiety, stress management, etc.).
The Role of Non-Clinical Care Teams in Curtailing Provider Demand
Beyond leveraging clinicians, virtual care solutions are extending provider supply by leveraging non-clinical teams such as Certified Health Coaches to motivate clients to adhere to treatment protocols and make lifestyle changes. The integration of non-clinical care team members not only extends provider capacity, but also has been proven to drive behavior change and improve health outcomes. Digital health’s darling Livongo, now part of Teladoc, is a case study in the efficacious utilization of health coaches to manage the care of consumers with chronic conditions including diabetes, hypertension, and behavioral health disorders.
Companies like Brightline, a virtual pediatric behavioral health platform, are augmenting provider-led virtual care delivery with health coaches, tailored educational content, and community resources. Digital health unicorn Maven, a whole-person virtual care model for women and families, leverages a dedicated care advocate for each member complimented by proactive digital interventions, to guide members between on-demand visits with specialty providers. Other companies like Oath Care and Wisdo, are architecting social health platforms that lean on a community of empathetic peers who have lived through similar life experiences and Certified Health Coaches to help individuals experiencing major health events.
Harnessing Technology to Expand Provider Capacity and Reinvent Care Navigation
Finally, a new wave of virtual care companies are integrating technology solutions that can substitute live clinical encounters and ultimately expand provider panel sizes. For example, asynchronous care platforms such as CirrusMD leverage a chat-first model, connecting an individual to a provider in under 60 seconds and can resolve most encounters on the platform in a matter of minutes. Furthermore, AI-enabled workflow automation tools like Notable enable providers to focus on delivering high quality clinical care and reduce time spent on administrative tasks.
Not only can digital health companies integrate innovative technology, but some are also creating a digital ecosystem of care navigation, such as Transcarent, to triage consumers to the lowest cost, high quality care option or self-manage when appropriate. The company leverages non-clinical patient navigators to help consumers understand their coverage, schedule appointments, and file claims. Complementing care navigation are triage solutions, such as Buoy, to further expand provider capacity by enabling consumers to self-manage conditions and drive consumers to a virtual and/or in-person provider when necessary.
How Will the Market Converge?
In the short-term, increased demand for seamless and convenient digital health alternatives and overstretched providers delivering face to face care will drive both consumers and providers towards virtual care. Long term, virtual care can increasingly augment MD-level care with non-clinical team members and mid-level providers for less severe cases. A new wave of companies – what I have previously deemed as Virtual Care 2.0 – will further enable workforce scalability such that the panel size of providers reduces and their ability to treat patients expands. The market will converge to a new supply and demand balance, and, ultimately, a healthier equilibrium.
The provider shortage is a consequence of broken care delivery system and will not be solved by simply injecting thousands of MDs into the supply. While digital health offers several benefits, given the complex and systemic nature of the shortage, no single treatment will cure the issue. A swath of solutions that brings in stakeholders across the ecosystem will be required to ensure that care delivery is not compromised. Ultimately, digital health solutions will be critical to empowering informed connected healthcare consumers to proactively self-manage their care and be part of the solution for combatting the growing providers supply shortage.
Editor’s Note: The author holds a board role at NOCD, a portfolio company of 7wireVentures, the author’s employer. Separately, CirrusMD, Brightline, Transcarent, and Livongo, are all 7wireVentures portfolio companies.
Photo: hudiemm, Getty Images
Alyssa Jaffee is a Partner at 7wireVentures, where she focuses on investments in digital healthcare and technology-enabled services that empower consumers to be better stewards of their health in today’s changing healthcare ecosystem. Alyssa sits on the board of Caraway and Ayogo Health and is a board observer with Zerigo Health, NOCD, Jasper Health, and Brightline, and MedArrive.
Alyssa's prior experience in venture capital includes her time as an investor at Pritzker Group Venture Capital where she led investments in Bright.md and Tovala as well as worked closely with Apervita, Mingle Health, and AiCure. Additionally, she worked at Hyde Park Angels (HPA), one of the Midwest's largest angel organizations and Healthbox, an early-stage healthcare innovation firm, supporting their accelerator program called the Studio. Alyssa is also a Co-Founder of TransparentCareer, a 2016 NVC winning company focused on helping people make more data-driven career decisions.
Prior to business school, Alyssa worked as the Senior Director of Performance Technologies for the Advisory Board Company. There, Alyssa was charged with expanding new business through the sales of technology platforms. With an extensive travel regimen, Alyssa met with hundreds of hospital executive teams to understand their strategic needs and recommend various solutions. She has copious amounts of experience in launching new products and thinking about go-to-market strategies.
Alyssa holds a bachelor’s degree in Marketing and Spanish from the University of Wisconsin-Madison and an M.B.A. from the University of Chicago – Booth School of Business. Her work and accomplishments have been featured in Fortune, Stat News, MedCity News, Crain’s, and more.
