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The Impact of Increased Access to Telemedicine∗

SIEPR
Jun 2021
Working Paper
21-038
By  Dan Zeltzer, Liran Einav, Joseph Rashba, Ran D. Balicer
We estimate the impact of increased access to telemedicine that followed widespread adoption during the March-April 2020 lockdown period in Israel (due to COVID-19). We focus on the post-lockdown period, which in Israel was characterized by a temporary return to normalcy. Prior to the lockdown, telemedicine accounted for about 5% of all primary care visits. It peaked at around 40% during the lockdown, and remained high, at around 20%, during the post-lockdown period. Using a difference-in-differences framework, we compare primary care episodes before and after the lockdown between patients with high and low access to telemedicine, with access defined based on their main primary care physician's propensity to adopt telemedicine during the lockdown. Increased access to telemedicine results in a 3.5% increase in primary care visits, but a 5% lower per-episode cost, so overall resource utilization is slightly lower. We find that remote visits involve slightly fewer prescriptions and more follow-ups, mainly with the same physician, which is consistent with a prolonged diagnostic path in the absence of physical examination. However, analyzing specific conditions, we find no evidence of missed diagnoses or adverse outcomes. Taken together, our findings suggest that the increased convenience of telemedicine does not compromise care quality or raise costs.