Telehealth Didn’t Break the Bank—and the Data Prove It

The dramatic expansion of telemedicine following the COVID-19 pandemic has not significantly increased total health care visits or medical spending, according to an analysis of medical claims from more than 3 million insured US adults from January 2019 through October 2023. Researchers from the University of California, Los Angeles (UCLA), found that widespread telemedicine adoption was not significantly associated with increases in either ambulatory visits or total medical spending.¹

The study, published May 11, 2026, in JAMA Network Open, investigated the impact of the COVID-19 pandemic on medical visit habits and offers a reassuring answer to the questions, “Would the convenience of telemedicine cause patients to flood the system with visits they'd otherwise skip?” and “Would spending spiral out of control?”

The findings arrive at a pivotal moment. During the 2020 public health emergency, CMS introduced sweeping policy changes to facilitate telemedicine access, including payment parity with in-person visits, removal of geographic restrictions, and elimination of patient cost-sharing. However, their long-term fate remains uncertain. Without action from Congressss, the federal telemedicine flexibilities that supercharged the industry’s growth are set to expire at the end of 2027.

“These findings ease concerns about large spending increases resulting from nationwide telemedicine expansion,” the authors wrote, noting that continuing current telemedicine coverage is “unlikely to meaningfully increase near-term spending.”

The mean (SD) patient age in this study was 54.2 (17.2) years, and female patients made up the majority of the study population (55.7%). Also, the 3.04 million US adults accounted for 120 million visits overall, of which 9.8% were telemedicine visits. Total spend was $178.44 billion between January 1, 2019, and October 31, 2023.

A Natural Experiment on a Massive Scale

In March 2020,² federal regulators slashed long-standing restrictions on telehealth, granting payment parity with in-person visits, waiving geographic limits, and eliminating patient cost-sharing for virtual care under Medicare. Telemedicine use exploded overnight, according to the study authors¹: In regions with the highest quintile of telemedicine adoption rates, virtual visits jumped from just 0.26% of ambulatory visits in 2019 to more than 40.7% by 2020. In stark contrast, they rose from 0.24% to 2.5% over the same years in regions with the lowest quintile of telemedicine adoption.

The dramatic shift gave researchers a rare opportunity, and the UCLA team used a difference-in-differences design to compare the highest- and lowest-adopting regions. This analysis drew on Milliman MedInsight’s Emerging Experience Research Database, which covers patients enrolled in Medicare fee-for-service, Medicare Advantage, Medicaid, dual-eligible, and commercial insurance plans across all 50 states.

The cohort of 3.04 million individuals—mean age 54.2 years; 55.7% female—generated 120 million ambulatory visits, with 9.8% of those being telemedicine visits, and $178.4 billion in spending over the study period. Rather than comparing telemedicine users with nonusers, the study used regional telemedicine adoption as its exposure variable, classifying hospital referral regions into quintiles based on their 2020 telemedicine use rates.

The Numbers Tell a Consistent Story

Across every payer group examined—commercial insurance, Medicare fee-for-service, Medicare Advantage, Medicaid, and dual-eligible—the results were uniformly null. Overall, areas with the highest telemedicine adoption showed a 2.4% decrease in total visits and a 0.5% decrease in spending compared with low-adopting areas; however, neither result was statistically significant.

This research also found no significant differences across the 5 census regions of the country (Midwest, Northeast, South, West, unknown). Overall, high-adopting regions showed 2.4% (95% CI, −8.1% to 3.6%) fewer visits and 0.5% (95% CI, −13.1% to 13.9%) lower spending vs low-adopting regions, but the CIs crossed zero, indicating the null finding, the authors explained.

The null finding held up even when researchers sliced the data by geography, income, insurance type, and social vulnerability. Urban populations, Medicaid enrollees, dual-eligible patients, and Medicare Advantage beneficiaries all showed trends pointing toward modest savings that failed to reach statistical significance. Rural populations showed a slight uptick, at 3.4% (95% CI, −4.9% to 12.5%) more visits and 3.8% (95% CI, −12.2% to 21.4%) higher spending, but these numbers also didn’t reach statistical significance.

To stress-test their conclusions, the team examined injury-related spending, a category with no plausible telehealth substitution pathway. If the research design were sound, injury-related spending wouldn’t change much between high- and low-adoption regions; it didn’t, lending further credibility to the study’s primary results.

What This Means for the Telehealth Debate

Lead author John Mafi, MD, MPH, noted that as telemedicine use grew, visits and spending in heavy-adopting regions tracked closely with patterns in lighter-adopting regions—reassuring for anyone worried about ballooning costs, but more sobering for those hoping telemedicine would close long-standing gaps in access. “At least so far, it looks more like a substitute for in-person care than a true expansion of it,” Mafi said in a statement.³

That substitution dynamic is important. Telemedicine appears to be replacing in-person encounters rather than layering on top of them, which may help explain why neither costs nor volumes increased appreciably.

The authors acknowledge they were unable to assess quality of care or health outcomes and that these gaps leave open the possibility that some telehealth visits could have been less effective than their in-person equivalents even if they didn’t cost more. The claims data also couldn’t be reliably stratified by race or ethnicity, a notable gap given existing concerns about digital access disparities. Further, the study’s regional-level design means individual-level conclusions should be drawn with caution.

With tens of millions of Americans now relying on telehealth for routine and chronic care management, insurers, employers, and patient advocates have urged Congress to make the pandemic-era flexibilities permanent. Skeptics have warned that easier access could trigger a surge of low-value, unnecessary care. This study’s breadth and consistency suggest those concerns may be overstated.

For policy makers facing a 2027 deadline, the data suggest that extending CMS telemedicine flexibilities carries limited near-term fiscal risk—though the question of whether telemedicine can meaningfully expand access to underserved populations remains open.

“Utilization and spending changes were consistently null across Medicare fee-for-service, Medicare Advantage, Medicaid, dually eligible, and commercially insured populations,” the researchers concluded, adding that this can help to ease concerns “about large utilization and spending increases from telemedicine expansion.”

References

1. Mafi JN, Vangala S, Cantor J, et al. Telemedicine adoption, US ambulatory visits, and total medical spending, 2019-2023 JAMA Netw Open. 2026;9(5):e2611835. doi:10.1001/jamanetworkopen.2026.11835
2. Nov. 7, 2025: national advocacy update. American Medical Association. November 7, 2025. Accessed May 11, 2026. https://www.ama-assn.org/health-care-advocacy/advocacy-update/nov-7-2025-national-advocacy-update
3. Telemedicine has not led to increased use of medical care or higher health care costs, new UCLA-led research finds. News release. UCLA Health. May 11, 2026. Accessed May 12, 2026. https://www.uclahealth.org/news/release/telemedicine-has-not-led-increased-use-medical-care-or