Early in the pandemic, private insurer payments for telehealth and in-person claims were similar

Telehealth use surged with the COVID-19 pandemic as patients sought access to services while providers implemented social distancing protocols. Early in the pandemic, many payers eased restrictions on the use of telehealth and increased reimbursement rates to encourage its use.

An ongoing question is how the growth of telehealth will affect health spending. If payers reimburse services provided through telehealth at a lower rate, there could be cost savings. Alternatively, if telehealth encourages the use of more services, total spending could increase.

In this analysis, we compare payments for professional medical service claims delivered via telehealth and in-person in 2020 using data from the Health Care Cost Institute (HCCI). We looked at the average paid amount for evaluation and management claims and mental health therapy claims controlling for variation across providers, regions, and the severity of the claim. The average paid amount includes both the plan payment and enrollee cost sharing. Evaluation and management claims are some of the most common claims included as part of a medical visit, and typically cover the charge for a physician or qualified provider to diagnose and treat a patient. One encounter may include multiple evaluation and management claims, depending on the services rendered. In this analysis, we do not consider reduced patient travel costs, improved efficiencies in wait times, changes in the rates of laboratory or other ancillary services provided, or overall changes in access to care. We did not assess the extent to which telehealth substitutes for in-person services or its impact on overall use or spending.

We find that private insurers paid similarly for telehealth and in-person professional claims for evaluation and management and mental health therapy services, on average, in 2020. This is after accounting for variation across regions, providers, and severity level, among privately insured. Among providers who offered both telehealth and in-person care, a large share received similar payments for service provided in-person or through telehealth.

Private insurers paid similarly for in-person and telehealth claims in 2020 Click To Tweet

Private insurer payments for in-person and telehealth evaluation and management claims were about the same in 2020

We compared the average payment for in-person and telehealth for over 76 million evaluation and management claim lines using 2020 HCCI data. We controlled for variation across providers, regions, and severity of the claim.

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We find that the payment for in-person evaluation and management claims was about the same as those via telehealth across all levels of severity for both new and established patients with private insurance. There are five levels of evaluation and management claims, depending on level of medical decision making and complexity of the case. Payments for higher severity claims were more than lower severity claims regardless of whether the service was delivered in-person or through telehealth. New patient claims payment was higher than that for established patients, on average. Of evaluation and management claims, 18% were delivered virtually. Care for higher severity level and new patients was more frequently delivered in-person than virtually.

Mental health therapy claims payments were similar for in-person and telehealth care among privately insured in 2020

As we have found in earlier analyses, telehealth became a particularly important way of accessing mental health care since the start of the pandemic. Similar to evaluation and management claims, we compared the average payment of in-person and telehealth claims for over 21 million mental health therapy claims using 2020 HCCI data.

We find that 52% of mental health therapy claims in 2020 for people with private health coverage were delivered over telehealth. For the most common mental health claims, the average payment (insurer and enrollee paid amounts combined) was about the same regardless of whether the service was delivered by telehealth or in-person. Higher severity or longer mental health therapy claims were delivered in-person and over telehealth at similar rates.

Telehealth and in-person payment amounts were similar among most providers offering both virtual and in-person care in 2020

In addition to comparing the average claims payments, we examined how paid amounts varied within each provider. We looked at average paid amounts for telehealth and in-person claims within providers. We looked at the most prevalent evaluation and management claim code (CPT code 99213: established patient evaluation and management severity level 3) and mental health therapy claim code (CPT code 90837: psychotherapy 60 minutes).

Among the overwhelming majority of providers offering the same service by telehealth and in-person, the average paid amount for claims delivered over telehealth was within plus or minus 10% of the payment for in-person claims. For 5% of providers offering mental health therapy and 4% of providers offering other evaluation and management services, the payment for telehealth was 10% or more lower than in-person care by the same provider. Conversely, for about 1 in 10 providers, the payment for telehealth claims was more than 10% higher than in-person care by the same provider.

The vast majority of employers believe telehealth is important for access to care

In the 2022 KFF Survey of Employer Health Benefits, 90% of employers stated telemedicine will be important in providing access to care for behavioral, primary, and specialty care, and in remote settings.

Most employers do not expect telehealth to affect health spending

Most employers expect telehealth to have no effect on total health spending, according to the KFF employer survey. Among large employers, most stated telehealth payments were about the same as in-peron payments.


Telehealth visits, particularly for mental health, increased during the COVID-19 pandemic due to expansion of telehealth coverage and easing of state and federal rules relating to telehealth practice and reimbursement. In this analysis, half of mental health claims were delivered over telehealth.

Our findings here show private insurer payments for telehealth professional claims were similar to in-person for some common services in 2020, the first year of the COVID-19 pandemic when in-person care was deferred or shifted to telehealth to avoid spread of COVID-19. We do not know at this point if private insurers continue to pay for telehealth in parity with in-person care. However, if telehealth payments continue to be the same as those for in-person care, then this raises questions as to whether telehealth will reduce the spending on common health services, as some have predicted.

The primary benefit to expanding telehealth may be increased access to services and convenience for enrollees. Large shares of employers surveyed in 2022 believe telehealth will play an important role in providing access to services going forward. In 2022, over 90% of employers covered telehealth, which is a significant increase compared to 2015, when less than a third of employers covered telehealth and utilization of these services was very low.

Telehealth use surged during the pandemic, but the future of telehealth will be shaped by its effect on total health spending, federal and state regulations relating to scope of practice and reimbursement, and payer coverage and reimbursement policies.


Health Care Cost Institute (HCCI) claims data physician file for the 2020 calendar year was used in this analysis. Enrollees with an employer-sponsored insurance and physician claims paid as primary coverage were included. Evaluation and management claims in the professional physician file were identified based on CPT/HCPCS codes (99201-99205, 99211-99215). Mental health therapy claims in the professional physician file were identified based on CPT/HCPCS codes (90791-92, 90832-90840, 90846, 90847, 90853). Telehealth claims were flagged based on presence of a modifier code (95, GT, GQ, G0) or place of service code (02) on the claim line. Claim lines with less than $10 or over $1000 in paid amounts were excluded.

In 2020, 76 million evaluation and management claims and 21 million mental health therapy claims were identified. About 18% of evaluation and management claims and 52% of mental health claims were offered by telehealth. Average paid amount (plan payment plus member cost sharing) at the claim-line level was regressed on telehealth indicator with provider NPI identifier fixed effects controlling for provider CBSA. Separate models were run for each CPT/HCPCS code. To test the sensitivity of the results, models were run without excluding claims from providers offering only telehealth or in-person services and with claims from providers who had more than 10 claims in 2020; these yielded similar results as those presented above.

For the third chart comparing differences in telehealth and in-person claims allowed amount among providers offering the same service over both, we compared average claims payments within each provider offering both in-person and telehealth services. Average paid amount was compared for CPT codes with highest frequency claims: evaluation and management established patient severity level 3 (CPT code 99213) and psychotherapy 60 minutes (CPT code 90837). Providers with 15 or fewer telehealth or in-person claims were excluded. This comparison includes over 90,000 unique provider NPIs for CPT code 99213, and over 50,000 provider NPIs for the mental health therapy code 90837.

Some limitations of our analysis are that we did not assess whether telehealth appeared to supplement or duplicate in-person care, nor did we assess whether telehealth was associated with more or fewer ancillary services or follow-up visits. Rather, we simply compared paid amounts for each claim service code. Telehealth may reduce a patient’s wait time and travel costs, which was also not studied here. Additionally, it is not clear going forward whether insurers will continue to reimburse for telehealth at a similar rate as in-person care, or whether this was a temporary decision during the early pandemic when there was relatively low utilization of care overall and a compelling reason to avoid in-person care.

The Peterson Center on Healthcare and KFF are partnering to monitor how well the U.S. healthcare system is performing in terms of quality and cost.

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