**4. Employer and Payor Reimbursement**

The COVID-19 pandemic fueled rapid healthcare provider adoption of telehealth, as social distancing measures were implemented and government and commercial payors relaxed regulations and reimbursement requirements [46]. The transformation of care delivery in turn enabled consumers and providers to connect via virtual healthcare visits and associated modalities. The widespread adoption of telehealth has led both employers and payers to accelerate and look for innovative ways to reimburse for different digital health apps. For example, the recent \$37 Billion merger of telehealth leader Teladoc and digital chronic disease management company Livingo has set the precedent for rapid change in adoption of digital applications with payers and employers ready for embracing them as part of mainstream providers [47]. In the fragmented U.S. market, potential barriers remain in terms of who will pay, but payers are starting to cover digital apps.

The Decision Resources Group found that across healthcare executives in integrated health networks (IDNs), Medicaid managed care organizations (MCOs), and pharmacy benefits managers (PBMs), 25% said their organization provides coverage for digital therapeutics, and an additional 45% expressed interest in providing coverage. In a 2019 survey, the National Business Group on Health found that 25% of large self-funded employers are considering creating orthopedic centers of excellence by 2021 [48]. Moreover, 45% of orthopedic COE contracts are structured as bundled payments. Given the potential for clinical benefit and cost savings, employers and health insurance payors are increasingly reimbursing use of digital health apps.
