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How telemedicine will change care delivery and costs in 2018


Health systems realize that telehealth can help them achieve a wide range of objectives, from care coordination to readmission avoidance and market share expansion.

Direct-to-consumer (DTC) telemedicine is growing at an ever-expanding rate due to new phone, computer, app technology and patient demand. Now, patients can quickly assess healthcare providers for phone or video visits via their personal devices. For hospitals and providers, the big draw with virtual visits is the potential savings involved in replacing physician office visits and ER visits.

By delivering care on demand, patients don’t have to delay visits or treatment. In some cases, this can help prevent more serious complications and ultimately cut costs, says Angela Pantelas, director of telehealth strategy and operations at Allegheny Health Network. Under the umbrella of telemedicine, the large healthcare system located in the Pittsburgh metro area offers two types of visits: e-visits and video visits.

“When we refer to e-visits, we are talking about nonsynchronous electronic encounters with patients. The patient completes a logic-embedded questionnaire specific to a primary care condition he is experiencing, and a provider responds,” says Pantelas. Typically, patients seek treatment via e-visits for sinus issues, urinary issues, and cough, she says.

There is very limited, if any, reimbursement for e-visits, and patients pay out of pocket. “However, this has not stopped patients from seeking care in this manner, given the low patient cost of $38 per encounter,” says Pantelas. “That’s the market value for this service.”

Pantelas says reimbursement is more prevalent for video telemedicine visits, for both primary care encounters and specialty consults, and that video visits are significantly on the rise for both primary care and specialty care.

The health system recently launched an oncology genetic counseling video visit, which connects patients in the northern-most region of Pennsylvania with genetic counselors in Pittsburgh, so patients don’t have to travel two hours for counseling. “We’ve now tripled the number of monthly clinics, and can now offer urgent consults,” says Pantelas.

High growth expected

In December 2017, Teladoc, Inc., the world’s largest virtual care delivery services provider, announced record growth of greater than 100% in the hospital and health system market. The company now supports more than 200 hospitals, more than doubling its total in 2017.

Teladoc provides virtual visits and consults in more than 450 medical subspecialty areas, including those related to chronic medical conditions such as cancer and congestive heart failure.

“As health systems are realizing that telehealth can help them achieve a wide range of objectives, from care coordination to readmission avoidance and market share expansion, we are seeing a significant increase in telehealth adoption and utilization,” says Alan Roga, MD, president of the provider division for Teladoc. He says solving the business needs with a telehealth solution will continue to fuel future growth.

Lori Uscher-Pines, senior policy researcher at the RAND Corporation, says when telemedicine first began picking up traction, companies focused on treating patients with minor acute illnesses. However, companies have recently expanded their services and increasingly look like a “one-stop-shop.”

“They continue to offer services for minor acute illnesses, but have also expanded into teledermatology, telemental health, telelactation, telecontraception, etc,” she says.

Private payers and employers are increasingly covering telemedicine, but Medicare typically does not provide reimbursement. “Medicare only reimburses for telemedicine when a patient in a rural area presents to a healthcare facility for care [and that patient then receives a telemedicine consult with a physician elsewhere],” says Uscher-Pines. Because DTC telemedicine visits typically occur in a patient’s home, this type of visit is not reimbursed.”

Next: Cost impact



Cost impact

Lew Levy, MD, chief medical officer for Teladoc, says e-visit growth will continue if such visits prove to deliver better outcomes and value than the status quo. He says e-visits can save approximately $36,000 per expert opinion case (for cancer, heart disease, gastrointestinal disorders, and musculoskeletal).

“One study reports an average wait time of 24 days to see a doctor,” Levy says. “Virtual care delivery has the power to alter the unnecessary financial and emotional toll of misdiagnoses and medical errors, saving on average $36,000 per case.”

Uscher-Pines and her colleagues reviewed commercial claims data of more than 300,000 patients and explored patterns of utilization and spending for acute respiratory illnesses. They estimated that 12% of telehealth visits replaced visits to other providers. However, they concluded that the net annual spending for acute respiratory illness increased $45 for each telehealth user because of increased utilization (in other words, they may be receiving care that they would otherwise have skipped due to the increased convenience of a telemedicine visit).  

Uscher-Pines says that because the new demand for DTC e-visits is being fueled by growing smartphone use, Internet access, and customer demand for convenience, it is unknown just how valuable they are. The technology, i.e., the smartphones, and the ease of using it, is driving the increased growth.  That raises questions about whether these visits really are needed.

“This is the case with many innovations in healthcare delivery,” says Uscher-Pines. “The research takes time and in the meantime, patients, payers, employers, and policymakers are confronted with real decisions regarding using, covering, and regulating these services”

Recently, researchers looked at the quality of telemedicine websites and smartphone apps diagnosing and treating skin disease and revealed concerns about the quality of skin disease diagnosis and treatment provided. The researchers, who published their article in JAMA Dermatology, found that some patients may risk using services that lack transparency, choice, thoroughness, diagnostic and therapeutic quality, and care coordination.

With a huge growth spurt expected in telemedicine, there more oversight and regulation may be necessary.  Uscher-Pines says millions of Americans already are accessing telemedicine for an increasingly diverse set of healthcare needs, so there is an urgent need for more research on how it impacts access, quality, and costs.

John Schieszer, MA, is an award-winning national journalist and radio and podcast broadcaster of The Medical Minute.  He can be reached at medicalminutes@gmail.com.

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