A Big Shift in Telemedicine’s Cost-benefit Equation

A Big Shift in Telemedicine’s Cost-benefit Equation

Video, audio and digital patient-care connections add efficiency, effectiveness

At least 10 million people already benefit from telemedicine technologies. “And that will double in the next 18 months,” says Jonathan Linkous, CEO of the American Telemedicine Association in Washington, D.C.

“We have several things coming up all at once: the aging of the population, health reform, and technology costs coming down,” Linkous says. “We’re getting more telemedicine inserted into the regular practice of care, and it’s already making a difference.”

The Veterans Health Administration reduced hospitalizations by 20 percent when it used home telehealth monitoring to check on some of its patients with chronic conditions. If symptoms or vital signs gave an early indication of trouble, care providers could intervene before serious problems developed.

New devices also make it easy for people with diabetes to send blood glucose measurements to their clinics throughout the day. Software detects patterns and anomalies, or an adverse reaction to a changed dose of insulin.

Telemedicine is care provided remotely, and the distance may create counterintuitive advantages. In patients served by McKesson’s customer base of home care agencies, “oftentimes we see from the data that they’re actually more honest with the device than they are with the provider directly,” says Karen Utterback, vice president of product management and marketing for McKesson’s provider technologies business. The evidence is anecdotal, but if patients find it hard to look a nurse in the eye and admit that they haven’t complied with care instructions, she explains, it may be that interacting with that nurse through a device helps them “feel more free to be honest.”

Home telehealth units—hardware and software—vary. The interface often includes video, audio, and digital connections between patients and care providers. Sometimes the base unit is a simple tabletop “box” that can send data over telephone lines to a care coordinator. Peripherals, such as scales, thermometers, and blood pressure cuffs, wirelessly transmit their measurements to the base.

Many units cost health care providers $1,000 or less, plus a subscription fee for connectivity of roughly $75 to $100 per unit per month. Additional costs include staffing to monitor patients and follow up with them. Some private insurers already cover telehealth care. Linkous describes Medicare and Medicaid as heading in that direction, but says they lag a couple years behind the private sector.

The calculation of telehealth’s costs and benefits is changing dramatically, Utterback says. A decade ago in home care agencies, “adoption was driven largely by an expectation that with the use of remote patient monitoring, they could limit the number of face to face encounters they had with the patient” and lower the cost of care. Instead they found that with more data, they understood more about their patients’ needs. “In some cases, they were interacting with them face to face more often,” she says. Patients were healthier, but “it was difficult to turn around and prove the return on investment in the technology.”

Today with the Affordable Care Act, “there’s a more honest discussion” about the value of telehealth from a patient outcome perspective, Utterback says. Healthcare providers that have found the technology costs difficult to bear on their own may now discover that hospitals are willing to share the costs if it means preventing patient admissions and readmissions. And some of the technology costs are disappearing.

“There’s about to be a pretty significant change” driven by the use of patients’ own Internet access, tablet computers, and smartphones, Utterback says. The Continua Health Alliance, an international nonprofit organization of health care providers and technology companies, is leading an effort to improve and standardize the way telehealth devices transmit their data. By doing away with proprietary data feeds, “anybody’s glucose monitor, for example, could send its results to a smartphone app and then be available to the case manager who’s monitoring those results.”

“These kinds of advances in technology will open up innovation and will push the cost down and create far more flexibility,” Utterback adds.

Emerging telehealth technologies already focus on consumers’ mobile devices. EpocratesRx is a free smartphone app that lets users cross-check their name brand, generic, and over-the-counter medications to see if they’re at risk of a negative drug interaction. More than 50 percent of physicians, or 1 million doctors, say they also use EpocratesRx.

Increasingly, “telemedicine is a part of coordinated care,” Linkous says. “When people used to get discharged from the hospital, they’d go home with a piece of paper with instructions. That’s just not going to fly anymore.”