Teladoc Health/Livongo Merger
Flash Insights 2020

Initial Reactions Favorable, Especially among Existing Teladoc Health Clients

One of the largest mergers in healthcare history (valued at $18B) leaves some customers wondering what the combined company will look like. Is this a chronic care company with a telehealth platform, or a telehealth company moving into other patient engagement modalities? Almost all respondents (87%) had at least heard of the merger, and the majority (63%) expressed a favorable opinion. More specifically, existing Teladoc Health clients have reacted very positively to the merger and believe the expansion and growth will be beneficial for customers. One VP shared, “As time has gone on, Teladoc Health has moved from just being employer focused to really starting to focus on healthcare and health systems. They have made a huge number of strategic acquisitions to make themselves a complete player in the health system environment. So to me, the merger made a lot of sense.” An HR director shared thoughts about the future opportunities that this creates for their organization, saying, “My reaction to the merger was favorable. I see the potential. We are moving from just having a telehealth platform that treats urgent one-off needs to incorporating chronic disease management and expanding the spectrum of care.”

Not everyone has jumped on the bandwagon yet. There is still some uneasiness and uncertainty among clients that will need to be addressed. One customer using both Livongo and Teladoc Health solutions reported an unfavorable reaction: “My initial reaction to the merger is that it will be a distraction. Teladoc Health is much bigger than Livongo Health, and Teladoc Health is having a huge year. I am worried that Livongo Health will maybe lose their focus” (VP).

“We have looked at adding Teladoc Health functionality. We haven’t done it yet because everything came out right before COVID-19 hit. But the benefits of having virtual doctor visits accessible 24/7 would be an enhancement for our members. People are trying to distance themselves right now, and they don’t want to go into the doctor’s office and be exposed to things, especially if they have a compromised immune system or diabetes.” —Analyst

“I am very in favor of the merger, especially after the COVID-19 issues that we have dealt with and our move to telemedicine. The merger feels like a natural progression for Livongo Health. I know a little bit about Teladoc Health, so I am excited to see what they can do with visits or things like launching hypertension management, which is something we are interested in. . . . I am curious to know from a cost standpoint what the merger will do to Livongo Health; that is my only concern about how the situation will work. I wonder whether they will still have a singular option we can use or whether we will have to buy into the full Teladoc Health service.” —Manager

Livongo Clients Not as Eager to Increase Engagement with Vendor

Current Livongo customers do not feel that the merger is likely to influence how much they will work with their vendor. Overall, there is uncertainty among this client base and concern about the future. “I still don't understand why Livongo is going down a path with Teladoc Health,” said an executive. “Their move is different than what their whole model has been based on chronic conditions. . . . I get worried thinking about how Livongo could be diluting themselves; we originally went with Livongo for very targeted and focused areas that we knew Livongo was good at. If they start to dilute their specialties, I don’t know what will happen.” Several Teladoc Health and InTouch Health clients said they would be more likely to increase engagement as a result of the merger and see opportunities to expand with the addition of Livongo. A director using InTouch Health said, “I would love to offer Livongo to the rural communities that we assist. Those communities have very limited resources, and some don't have diabetes education or access to a dietician. I hope that we can use Livongo in our rural communities where chronic diseases are often neglected.”

Customers Advise Vendor Leadership to Take It Slow and Communicate

When asked what advice they would give to the vendor leaders moving forward, customers shared two main needs. First, respondents want the vendor to take a measured approach so they can really understand the impact of decisions before moving ahead: “If I had the ears of the leaders of the newly merged company, I would tell them to make sure that they understand what they have bought. It all sounds good at the top level, but the vendor really needs to see why decisions were made and why things were done the way they were. A lot of times, a merger is about finding symbiosis between the vendor and the area they supply. The leaders should dig down a little deeper before they make any changes” (IT director). Second, customers want to see transparent communication about the products and the future road map. A CMIO shared, “I would like the vendor's leadership to be transparent about the shared goals and timeline. We don't have much understanding of those things. Even if the vendor doesn't understand those things either, I would like them to be transparent about the fact that they don't understand.”

Statement from Teladoc Health

There is a seismic shift in the urgency and readiness of hospitals and physician practices, large and small, to virtualize now. Doctors and hospitals need medical-grade solutions and a unified virtual care strategy that can scale and grow with them. By combining with InTouch Health and Livongo, Teladoc Health is leading this transformation as a single, integrated partner for our clients. With our proven healthcare industry expertise and unified platform, we are delivering a better way to engage with patients and drive better health outcomes across the full continuum of care, at every stage in a person’s health journey.