Teladoc and Doximity Face Financial Turmoil as Medicare Telehealth Rules Expire
Two major telehealth companies, Teladoc Health and Doximity, are facing financial struggles as key Medicare provisions near their end. Both firms have seen slower revenue growth, though their challenges stem from different parts of the marketplace. Investors are now questioning their long-term stability.
Medicare's expanded telehealth rules, introduced during the pandemic, will expire on 31 January 2026. After this date, reimbursements will only apply to services delivered from healthcare facilities, in rural areas, or for virtual mental health care. This change threatens Teladoc's business model, which relies heavily on broader virtual therapy access.
Teladoc Health has yet to turn a profit and continues to struggle with securing consistent third-party payments for its BetterHelp service. Its revenue growth has already slowed, and the upcoming Medicare shift could push performance down further. International expansion has also proven difficult, adding to investor concerns.
Doximity, meanwhile, operates a physician networking and marketing platform alongside its telemedicine tools. While less exposed to Medicare changes, its growth has stalled in recent years. With 80% of U.S. doctors already using its services, expanding its user base has become increasingly difficult. The company's slowing sales have led to a decline in its stock value.
Neither firm has provided clear reasons for their 2026 stock declines beyond general market pressures. Available reports only reference unrelated trading promotions from financial institutions.
The end of Medicare's temporary telehealth rules will limit reimbursement options for providers like Teladoc. Doximity's growth challenges stem from market saturation rather than policy shifts. Both companies now face an uncertain financial outlook as investor confidence weakens.
