Digital Health and Virtual Care

On 5 August 2020 Teladoc Health agreed to buy Livongo Health for about $18.5 billion. Teladoc, founded in 2002, was the largest virtual-visit company in the US and a pandemic winner, selling access to doctors by phone and video to employers and health plans. Livongo, founded in 2014 by Glen Tullman, the former chief executive of Allscripts, sold connected glucose meters, blood-pressure cuffs and scales with coaching, paid by self-insured employers per enrolled member per month. It had about $170 million of revenue in 2019 and about 410,000 diabetes members by mid-2020 (company-reported). The combination promised a "whole-person" virtual care platform: cross-sell Livongo to Teladoc's thousands of clients, and Teladoc's services to Livongo's members. Teladoc's shares fell about 18–19% on the day of the announcement (reported).

The deal closed on 30 October 2020, largely in stock, with both companies trading near pandemic highs. Teladoc's share price peaked around $300 in February 2021 (reported) and then fell for years as visit growth normalised. Tullman left the board. In 2022 Teladoc recorded goodwill impairments of about $13.4 billion, mostly tied to Livongo, and a net loss of about $13.7 billion. By 2025 its revenue was $2.53 billion, down 2%; the segment that includes the former Livongo grew 3%. Meanwhile, the Peterson Health Technology Institute's March 2024 review of virtual diabetes programmes, Livongo among them, concluded that they produced modest clinical improvements that did not offset their cost and increased net spending (reported). This chapter explains what digital health sells, who pays for it, and why proof decided which companies survived the reset.