Omada Health Study Shows Virtual PT Saves on Medical Care and Costs.

Omada Health's virtual physical therapy program for musculoskeletal conditions reduced total medical care utilization and MSK-related costs by 6-12 months compared to in-person PT. This study is one of the first to compare the two treatment methods while accounting for the cost of the virtual program. MSK conditions affect over half of adults in the US and cost the healthcare system over $420 billion annually.

Omada Health (Nasdaq: OMDA), a virtual-first healthcare provider, has released groundbreaking research demonstrating significant cost savings from their virtual physical therapy program. The study, published in the journal Phys Ther., compared virtual PT to in-person physical therapy for musculoskeletal (MSK) conditions using claims data from July 2019 to May 2023 [1]. Key findings show that Omada's virtual MSK program achieved median per-member-per-month savings exceeding $100 in the first six months, with median gross MSK savings per member over $1,000 at both six and 12 months. The program delivered a positive ROI of 1.8x at both intervals, while reducing total medical care utilization and MSK-related costs compared to traditional in-person therapy.

This research is particularly significant as MSK conditions affect over 50% of U.S. adults and cost the healthcare system more than $420 billion in 2018, surpassing costs for diabetes and heart disease [2]. Omada's virtual PT shows 1.8x ROI with $1,000+ per member savings versus traditional therapy, positioning it favorably in the $420B MSK market. The study addresses a significant gap in previous research by including the cost of the virtual program itself in the ROI calculations, making this a more comprehensive economic analysis than prior studies.

The data reveals median per-member-per-month savings exceeding $100 in the first six months and median gross MSK savings per member over $1,000 at both six and 12-month intervals. This translates to a positive ROI of 1.8x at both measurement periods - a metric that will catch the attention of payers and employers. The research is particularly significant considering the massive scale of the MSK market - affecting more than half of U.S. adults and costing the healthcare system over $420 billion annually (exceeding costs for diabetes and heart disease). For employers specifically, MSK treatments account for approximately 15% of total medical costs, representing a $353 billion annual expenditure [3].

Beyond the direct cost savings, the study highlights how virtual PT addresses critical access barriers in traditional care: geographic limitations, provider availability, and coverage restrictions. By removing these obstacles, Omada's approach may prevent costly delays in treatment initiation that typically lead to downstream expenses like imaging and pain management [4]. The strategic importance extends beyond immediate savings. The research establishes Omada's potential as a consolidation point for employers seeking to streamline their healthcare offerings, particularly given the documented connection between MSK conditions and cardiovascular disease - directly aligning with Omada's position as a cardiometabolic care provider [5].

References:
[1] https://www.marketscreener.com/news/new-research-from-omada-health-demonstrates-significant-cost-savings-of-virtual-physical-therapy-ce7c50dfd08bf42c
[2] https://www.stocktitan.net/news/OMDA/new-research-from-omada-health-demonstrates-significant-cost-savings-wpj4yc4awxbi.html
[3] https://www.businessgrouphealth.org/resources/addressing-musculoskeletal-conditions-and-physical-therapy-needs-with-virtual-solutions
[4] https://www.evernorth.com/articles/health-care-total-cost-musculoskeletal-conditions
[5] https://www.marketscreener.com/news/new-research-from-omada-health-demonstrates-significant-cost-savings-of-virtual-physical-therapy-ce7c50dfd08bf42c