Can COVID-19 disprove the Iron Triangle of Health Care?

Feb. 14, 2022 / By Steve Delaronde

The Iron Triangle of Health Care theorizes that cost, quality and access cannot simultaneously improve. For example, improved patient access will increase demand and strain health care resources, thereby reducing quality and leading to higher costs. In my 2019 pre-pandemic blog, I argued that this theory could be disproven by introducing an outside disruptive event that results in improvements across all three areas. Is COVID-19 the disruptor that disproves the Iron Triangle of Health Care?

COVID-19 has been challenging health care systems worldwide since early 2020. The Centers for Medicare & Medicaid Services (CMS) reports that COVID-19 was a key contributor to the 9.7 percent annual U.S. health care spending increase in the U.S. in 2020, which brought total health care spending to $4.1 trillion. Quality of care has been compromised as hospitals deal with bed capacity issues and staff shortages. At first glance, COVID-19 does not appear to be the disruptor that would improve any, never mind all, of the Iron Triangle attributes.

However, the pandemic has forced patients and providers to think differently about how health care is delivered. During the first few months of the pandemic when onsite visit restrictions and patient fear of contracting the virus were at its peak, the use of telehealth services soared. Although a survey conducted in June 2021 found that telehealth usage rates were leveling off, these findings preceded the arrival of the delta and omicron variants. Even as rates leveled off, telehealth usage in 2021 was still 38 times pre-pandemic rates.

Could widespread adoption of telehealth, hastened by COVID-19, simultaneously improve health care access, cost and quality?

Access

Improved health care access can be defined in terms of availability, equity and the patient experience. Remote visit options offer the potential for improved availability to patients, particularly rural dwellers, as well as those that have difficulty leaving their home or securing transportation.

However, patients require a few essentials to allow them to take advantage of remote services, namely 1) a device (e.g., phone, computer), 2) broadband access and adoption and 3) digital health literacy. The tools needed to fully engage in telehealth are not equally distributed, thereby exposing a health inequity. Telehealth will not reach its full potential for improving health care access until these barriers are addressed.

Cost

Health care services are delivered more cost effectively when brick and mortar office visits are replaced with telehealth visits, remote patient monitoring (RPM) or home visits by community health workers. The question is whether telehealth supplements or replaces in-person office-based visits.

Health care systems and providers, like other businesses, will not routinely adopt practices that are not in their financial interest. The lower or nonexistent pre-pandemic reimbursement rates for telehealth visits compared to in-person visits kept virtual care in check. In a fee-for-service environment, health care providers will steer patients towards a more expensive service if both are expected to achieve a similar outcome.

Similarly, patients may seek care more often if it is both 1) more easily accessible and 2) available at a lower cost than traditional options. This may result in redundant or medically unnecessary care, such as treatment for low acuity conditions that would have normally not required a consultation or treatment. Another possibility is patients may start with a telehealth visit, but then learn that they must follow-up with an office-based visit to receive a more comprehensive diagnosis.

Quality

Patients who require regular monitoring, including those with behavioral health care needs or chronic conditions such as diabetes or heart disease, should benefit from health care services that are timely, frequent, and accessible. However, there is also the risk of overutilization and overtreatment for some populations. One study found that children diagnosed with acute respiratory infections were more likely to receive potentially unnecessary antibiotics when treated in a telehealth visit compared to an office visit.

Summary

While the COVID-19 pandemic resulted in greater awareness and utilization of telehealth services, improved patient access is not likely to lead to improvements in cost and quality without a corresponding shift from the traditional fee-for-service model. If telehealth visits are reimbursed at the same rate as office visits, then patient access may improve, but costs will also increase.

One option is to make telehealth visits available for low acuity conditions or chronic care management using a flat monthly fee or direct primary care. A change in the way health care is reimbursed is necessary for telehealth to become a valuable tool for both the provider and patient. Only then will there be an opportunity to improve access, decrease costs and improve quality simultaneously, thereby disproving the Iron Triangle of Health Care.

Steve Delaronde is senior manager of product, population and payment solutions at 3M Health Information Systems.

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