RPM experienced an unprecedented surge during the COVID-19 pandemic. With in-person visits restricted and healthcare systems overwhelmed, RPM solutions emerged as a critical tool to ensure patients, especially those with chronic diseases, continued to receive care. Providers, investors, and startups were eager to implement telehealth solutions, including RPM.
However, as life returned to normal, the industry's focus has shifted from hyper-growth to sustainable, profitable growth.
The COVID-19 boom brought unprecedented growth
During the height of the pandemic, RPM adoption skyrocketed. CMS implemented temporary changes to make it easier for providers to bill many forms of telehealth, including RPM CPT® Codes. Increased reimbursement, coupled with patients' inability or unwillingness to maintain in-person appointments, fueled growth. Providers wanted to continue to care for patients, and RPM companies had a tremendous opportunity to scale quickly. Investors, capitalizing on the sudden increase in demand for remote monitoring, were willing to make significant investments that enabled aggressive growth.
Rapid growth typically comes with long-term challenges. For providers and RPM companies, the 16-day rule for billing CPT® Code 99454, which had negatively impacted reimbursement, went away. RPM revenue increased without the need to put the right processes in place that encourage proper patient onboarding and utilization. In many cases, scale took precedence over operational efficiency and sustainable business models.
The shift towards profitability
As pandemic-driven demand subsided, RPM companies faced a new reality—growth alone was no longer sufficient. Investors began prioritizing profitability over expansion. New entrants saturated the market, making it more competitive and driving prices down. The industry experimented with different pricing models and as the reimbursement rules returned to pre-Covid rules, some of these models were no longer profitable.
RPM companies were forced to reevaluate their business models as the bottom line was now just as important as the top line. Investors were seeking sustainable revenue models, pushing companies to balance growth with strong financial fundamentals. That meant RPM companies needed to look at operational processes, customer retention, and costs.
Strategies for sustainable growth
Sustainable growth and profitability require RPM companies to focus on efficient operations and costs. Beyond salaries, the largest cost driver for RPM companies is devices. A trusted supply chain partner is critical for RPM companies seeking profitable, sustainable growth.
Device costs should be transparent, but understanding the full cost of devices, especially in today’s business environment, is more complex than just the retail price.
RPM companies that want to optimize their supply chain need to take a holistic approach to evaluating device costs, including:
- Contract terms: Forecasting device needs can be challenging for both providers who are unsure about patient adoption rates and for RPM companies. Your device supplier should provide flexible contract terms that optimize your processes.
- Inventory management: Holding inventory incurs costs for both providers and RPM companies. A great device supplier helps you manage inventory costs.
- Tariffs: Tariffs have been difficult to forecast as the rules seem to be changing regularly. A strategic supply partner should understand the impact of tariffs and support smart inventory management strategies that help reduce total costs.
- Device management: Monitoring clinicians should focus on clinical care, not device operations. A feature-rich, easy-to-use device management platform that proactively alerts clinicians to device issues, reduces costs, and drives utilization.
- Patient engagement: Easy-to-use cellular devices drive patient engagement, which increases patient utilization and reduces patient churn.
- Device Security: Security is potentially a very large hidden cost as security breaches with PHI can result in substantial costs, litigation, and loss of clients.
The future of RPM
While the hyper-growth of the COVID era may be over, RPM companies can still achieve sustainable growth. This requires a focus not just on sales but also on operations and cost efficiency. The right devices with a trusted supply chain partner and an intuitive device management platform can fuel profitable growth for RPM companies.
If your device provider isn’t helping you achieve your profit goals, contact Continua to see how we can lower your costs while improving your service and operations.
