Telehealth or telemedicine wasn’t new at the time the pandemic started, but that situation accelerated its implementation and development in significant ways. People can now, connect with health care providers from home or anywhere.

Telehealth or telemedicine lets providers deliver care without the need for in-person office visits. There are several key formats for this approach to health care.

Telehealth can be delivered through a video chat or phone call. Remote monitoring is also integrated into telehealth in some cases so providers can monitor patients when they’re at home. For remote monitoring, a device might gather vital signs to help providers stay up-to-date with a patient’s progress. Telehealth is especially well-suited to the management of ongoing health issues, such as chronic conditions.

The world of telehealth and digital medicine seems on track to continue to grow and be impactful in the healthcare industry. The U.S. is expected to have a shortage of over 120,000 doctors by 2030. With dwindling numbers of physicians and increased demand for health services, telemedicine could be one way to deal with challenges.

For investors, there could be continuing opportunities because of the growth of telemedicine as well. The following are some things to know, particularly from the perspective of investors.

Investing in Telehealth Stocks

Even before the pandemic, there were signals that digital health companies were something investors should keep an eye on. These signals included population growth, disparities in care among demographic groups, and increasing numbers of older people.

The investment case before the pandemic was built on the idea that companies were making health care simpler and more convenient for consumers since a lot of medical interventions don’t actually require in-person doctor visits.

The pandemic led more doctors and patients to try it out, and that shows broader adoption is likely on the horizon. Some experts and analysts feel that telemedicine is actually in its earliest days of adoption.

One of the primary public companies in this space currently is Teladoc. Teladoc offers virtual care services to consumers and employers. Teladoc also offers care services to hospitals, health plans, health systems, and insurance companies.

While the shares gained enormously in the height of the pandemic, analysts say there’s still room for growth in the next decade, especially with regard to the expansion of chronic illnesses and mental health services.

The Global X Telemedicine & Digital Health ETF invests in companies that could benefit from advances in digital health, such as connected devices, administrative digitization, and health care analytics.

ROBO Global Healthcare Technology and Innovation ETF offer telehealth exposure, but it also offers exposure to companies involved in robotics, genomics, and diagnostics.

Insurance companies like Anthem and Humana could benefit from the growth of telehealth because it will help generate savings compared to the costs of traditional care.

Telemedicine vs. Telehealth

One thing investors should be mindful of is that while we often use telemedicine and telehealth interchangeably, there are some subtle differences that can become relevant from an investor’s perspective. Telemedicine is usually a referral to delivering health services through communication networks. Telehealth can actually include connecting patients with doctors but also doctors to doctors and medical devices to both doctors and patients.

There’s more of an element of data and analytics that comes with telehealth compared to telemedicine.

Telehealth can also include nonclinical services, such as administrative meetings, continuing medical education, and provider training.

The Longevity of Virtual Care

Before the pandemic, most people probably didn’t even understand exactly what telehealth is. Now, it’s become the norm for many people. However, even though the pandemic is significantly less severe now, it doesn’t mean the service will be obsolete or unnecessary.

Telehealth could be a high-growth area that could generate strong returns well into the future.

One of the telehealth challenges was from people in rural areas with limited internet connectivity. The Biden Administration announced a $19 million investment to expand telehealth and improve access for rural communities. That’s likely just the beginning of such legislative moves, with Congress having dozens of bills it’s looking at that could expand virtual care.

Telehealth is also growing in popularity for employers, with a recent survey showing that 76% of employers increased their offerings during the pandemic. They also reported they planned to keep these options available for employees.

There’s a big incentive for the government and businesses to continue to push for more access to telehealth—it saves money. It can reduce hospital load, and it’s cheaper.

While it could be a good option looking forward, that’s not to say telehealth investments haven’t faced serious headwinds recently. Teladoc’s shares were nearly halved in value as the economy started to reopen. Some of that was also due to the announcement of Amazon entering the space, though. Amazon announced it was expanding the roll-out of Amazon Care telemedicine to all employees, and the company plans to eventually offer it to other employers.

Analysts feel that any short-term slumps are knee-jerk reactions and don’t reflect the long-term value propositions of companies in the space. Even as the world returns to normal, people will want to find a way to automate or virtually deal with things they see as errands, including basic medical appointments.

Grand View Research estimates the market will grow to a nearly $300 billion industry by 2028, from around $56 billion in 2020.

While there are promising opportunities, choosing the right ones is tough as more and more companies are entering the market. It’s unlikely that more than a few of the current companies will still be viable publicly-traded companies with any notable market capitalization.

If you want to invest in telehealth and telemedicine, as with anything else, do your research. You have to find those options for long-term value with an appreciation for the fact that many of the names you might be looking at currently are undoubtedly going to be gone from the marketplace in a few years.