For most of the last five years, digital health has been defined by uncertainty: will this telehealth waiver get renewed, will this AI tool actually hold up in a real clinical setting, will this startup's funding survive the next quarter? 2026 is shaping up differently. The headlines aren't about whether digital health works anymore; they're about which parts of it are built to last. That shift shows up everywhere from venture funding patterns to a Congressional bill signed in early February.
Bask Health operates in this market every day, building the infrastructure for telehealth and digital health brands, so these aren't abstract trends to us; they directly shape what we build and how the businesses on our platform plan for the next few years. Here's what's actually shaping digital health in 2026, grounded in what's happened so far this year rather than generic predictions.
Quick Answer: The Trends Defining Digital Health in 2026
If you only have a minute, here's the short version of where digital health is heading this year:
- AI has become baseline infrastructure, not a differentiator. The question now is how well it's embedded into real workflows, not whether a company has it.
- Funding is consolidating around platforms. Capital is flowing to fewer, larger companies, while single-purpose point solutions struggle to raise.
- Telehealth policy is finally stable for longer than a few months. Medicare's telehealth waivers were extended through December 31, 2027, the longest extension since the pandemic.
- The industry is beginning to self-regulate AI safety ahead of formal rules, especially in sensitive areas such as mental health.
- Payment is shifting toward outcomes, with new CMS models rewarding measurable results in chronic care over visit volume.
Each of these is worth understanding in more depth, because together they say a lot about which digital health businesses are positioned to grow this year and which ones are built on borrowed time.
AI Has Quietly Become Infrastructure, Not a Feature
From Differentiator to Default
For the last two years, "AI-powered" has been a meaningful label that investors and buyers have tracked closely. That's no longer true in 2026. Rock Health, one of the most closely watched sources of digital health funding data, announced it's retiring its long-standing practice of tracking "AI deals" as a distinct funding category. The reasoning is straightforward: the distinction has ceased to be meaningful because AI has become a baseline expectation in how digital health products are built, rather than a separate feature bolted onto them. Last year, AI-touting companies accounted for the majority of digital health funding. Still, increasingly, that's simply because most serious digital health companies use AI somewhere in their stack, not because AI itself is the pitch.
What "AI as Infrastructure" Actually Looks Like
In practice, this means the AI tools getting traction in 2026 aren't standalone chatbots or novelty features; they're embedded directly into clinical and operational workflows. Ambient documentation tools that draft clinical notes during a visit, intake systems that route patients based on their answers, and AI-assisted prescribing pilots that plug directly into a pharmacy's existing systems are the kinds of integrations actually moving the needle, as opposed to AI features that sit on top of a product without changing how care actually gets delivered.
Industry perspective: Rock Health researchers Ashwini Nagappan, Madelyn Knowles, and Jason Lei have pointed to a clear pattern among the startups still raising successfully in 2026: they're the ones embedding AI into complex, workflow-level use cases citing examples like an AI-assisted prescribing pilot integrated into a state's pharmacy infrastructure, and a clinical AI search tool now plugging directly into hospital EHR systems rather than offering AI as a standalone add-on.
Capital Is Consolidating Around Platforms
The Mega-Deal Bifurcation
Digital health funding got off to a strong start in 2026. The first quarter brought in roughly $4 billion in venture capital, a full billion more than the same quarter the year before, and the strongest first-quarter total since the pandemic-era funding peak. But that headline number hides a sharper story underneath: the total deal count actually fell, from 122 deals in the first quarter of last year to 110 this year, even as total dollars rose. Average deal size climbed to $36.7 million, the highest Rock Health has tracked in a single quarter since late 2021. And nearly 59% of all the capital deployed in the quarter went to just 12 companies, raising $100 million or more.
Why Point Solutions Are Losing Ground
Fewer, bigger deals mean investors are making more concentrated bets, and the businesses winning those bets tend to share a common trait: they're not single-purpose tools; they're systems that other parts of the healthcare ecosystem build on. A standalone scheduling app or a single-feature intake form doesn't have the same staying power as a platform that handles intake, clinical workflow, prescribing, and fulfillment as one connected system because the latter is much harder for a customer to walk away from, and much harder for a competitor to replicate piece by piece.
Telehealth Policy Finally Got Some Breathing Room
From Cliffhanger to Two-Year Runway
Telehealth businesses have spent the last several years planning around short-term cliffhangers. Medicare's telehealth waivers, first enacted in 2020 during the COVID-19 public health emergency, were extended repeatedly, usually for a few months at a time, until the cycle caught up with the industry in a serious way in late 2025. A government shutdown that fall let the waivers lapse for over a month before a temporary fix restored them through January 30, 2026.
When that deadline arrived without a permanent solution, the waivers lapsed again briefly before Congress passed the Consolidated Appropriations Act, 2026, which was signed into law in early February. That legislation retroactively restored the waivers and extended key Medicare telehealth flexibilities through December 31, 2027, by far the longest runway telehealth policy has had since the pandemic began.
What's Covered Through 2027
The policy details are tracked directly by HHS. The extension is broad: it preserves the waiver of geographic and originating-site restrictions, meaning patients can receive Medicare telehealth services from home rather than only from approved facilities; it keeps audio-only visits reimbursable; and it expands which provider types and sites, including Federally Qualified Health Centers and Rural Health Clinics, can deliver and bill for telehealth services. The Acute Hospital Care at Home program, which allows hospitals to treat eligible patients at home rather than on an inpatient unit, received an even longer extension through September 2030.
What's Still Unresolved
It's worth noting that this extension covers Medicare's general telehealth waivers; it's a separate matter from the DEA's temporary flexibility allowing controlled-substance prescribing via telemedicine without a prior in-person visit, which runs on its own timeline and is currently authorized only through the end of 2026. Telehealth brands prescribing controlled medications need to track that deadline separately, since it isn't covered by the Medicare extension at all. For everything else, though, this is the first time in years that telehealth and hospital-at-home businesses can plan two-plus years out instead of one fiscal quarter at a time.
AI Accountability Frameworks Are Emerging From Industry Itself
The VERA-MH Example
As conversational AI tools spread into more sensitive areas of care, the industry isn't waiting for regulators to set all the rules. In February 2026, mental health company Spring Health released VERA-MH, an open-source framework for evaluating how AI chatbots handle high-risk conversations involving suicide risk. It was built with input from practicing clinicians, suicide-prevention researchers, ethicists, and former federal health officials, and it's designed to give developers and healthcare organizations a consistent way to assess whether an AI system responds appropriately when the stakes are highest.
Why Self-Regulation Is Showing Up Now
Whatever happens to this specific framework, it's a signal of a broader pattern likely to recur across other sensitive clinical AI use cases in 2026: companies publishing their own safety evaluation standards in the open, ahead of formal regulation requiring them. This tends to happen when liability and trust pressures move faster than rulemaking does, and it's worth watching closely for any digital health brand using AI in a sensitive clinical context, because informal industry standards have a track record of becoming the baseline that regulators eventually codify into law.
Payment Models Are Shifting Toward Outcomes
The CMMI ACCESS Model
Federal payment policy is also nudging the industry toward measurable results rather than volume. The CMS Innovation Center's ACCESS Model, set to take effect in mid-2026, is built around paying for chronic condition management based on demonstrated outcomes rather than the traditional fee-for-visit structure that healthcare has run on for decades.
What This Means for Chronic Care Platforms
For digital health companies focused on chronic disease management, diabetes, weight management, cardiometabolic health, this kind of model specifically rewards platforms that can actually track and report outcomes over time, not just count visits. It's a meaningful signal for any DTC or hybrid telehealth brand built around ongoing condition management: the ability to demonstrate results, not just deliver visits, is becoming part of how reimbursement itself works.
What These Trends Mean for Telehealth and Digital Health Brands
Build for Durability, Not Just Today's Rules
Put together, the throughline across all of this is durability. Telehealth policy is more stable than it's been in years. Capital is rewarding platforms over scattered point solutions. Payment models are starting to reward demonstrated outcomes. And companies using AI responsibly are building accountability into the product itself, rather than waiting for someone else to mandate it.
How Bask Health Approaches This
For a healthcare or wellness brand building on top of this landscape, the practical takeaway is to build or choose a platform built for that same durability: one connected system handling intake, clinical workflow, and e-prescribing, and security and compliance, rather than a stack of point solutions that each have to be replaced as the market consolidates around them. That's the approach Bask Health takes with every virtual clinic built on our platform.
Conclusion
2026 isn't introducing dramatically new technology to digital health so much as it's separating what's durable from what was always going to be temporary in funding, in policy, and in how AI is actually used. The brands that come out ahead this year will likely be the ones built on infrastructure designed to last through the next policy cycle, not just the current one.
If you're thinking about how to build your telehealth or digital health business on infrastructure designed for where the industry is heading, you can explore Bask Health's plans or talk to our team about what that looks like for your brand.
References
- Spring Health. (2025). Spring Health launches Vera MH for suicide risk detection and intervention. https://www.springhealth.com/news/vera-mh-for-suicide-risk
- U.S. Department of Health & Human Services, Office for the Advancement of Telehealth. (n.d.). Telehealth policy updates. https://telehealth.hhs.gov/providers/telehealth-policy/telehealth-policy-updates
