Teladoc Health (TDOC) Piper Sandler 37th Annual Healthcare Conference summary

Integrated Care segment outlook

• Integrated Care generates about 60% of revenue and nearly 90% of earnings, with low single-digit growth expected for 2026 amid macroeconomic uncertainties.

• Key growth drivers include increased virtual visit revenues, operational excellence, new product launches, and international expansion.

• Headwinds include rising medical costs for employers and health plan challenges, prompting a focus on product innovation and execution.

• Business drivers are shifting from membership growth to service utilization, pricing power, and service penetration.

• US business is the largest, followed by international and health system segments, with solid 15% segment margins.

Chronic care and mental health integration

• Over a million enrolled in chronic care management, with many more eligible; significant cross-sell into a 100 million member base.

• More than 60 million have access to mental health services, with strong cross-sell and holistic population management.

• Engagement rates in chronic care are strong, with further upside possible by activating more eligible members.

• Mental health is embedded in chronic care programs, supported by a broad network of credentialed providers and digital tools.

• A new product, Wellbound, will launch in 2026, combining Integrated Care and BetterHelp networks for enhanced employee assistance.

Virtual care business model transition

• Core virtual telehealth is shifting from a subscription (PMPM) to a visit-based model, now over 50% visit-based in the US.

• Visit-based contracts are designed to maintain target margins, though the economic construct differs from subscriptions.

• Gross margin percent is more predictable in visit-based models, with less exposure to utilization swings.

• Employer market channel shows strong activity, while health plan channel faces headwinds due to industry changes.

• Membership changes in health plans will be reflected in 2026, with ongoing uncertainty in that channel.