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Benefits of Telemedicine: Healthcare Savings for Employers?

Practicing “telemedicine” doesn’t exactly conjure a positive image. Your initial thought might be to envision medicine by telemarketing or telephone.
It’s not that.

The American Telemedicine Association defines telemedicine as “the use of medical information exchanged from one site to another via electronic communications to improve a patient’s clinical health status".

These days physicians and patients can exchange vital information via a variety of effective and efficient remote means — video, email, smart phones and other wireless tools.

Benefits of Telemedicine

For businesses, the benefits of telemedicine are becoming a strong player. Telemedicine might be a tool that allows them to offer an affordable alternative to counteract employees’ higher insurance deductibles on health insurance. Research by Towers Watson revealed that 37% of employers surveyed said they plan to offer employees telemedicine options in 2015. An additional 34% said they intend to offer telemedicine in 2016 or 2017.

Employers can also look to telemedicine to improve employee productivity and reduce absenteeism, according to the Society for Human Resource Management. A telemedicine visit, for instance, is far less time-consuming than taking time off from work for routine doctor appointments.

Telemedicine can be used for low-level, common ailments such as colds, sore throats or muscle aches and pains. It can also be used to monitor more serious medical conditions such as hypertension, diabetes or heart disease.

According to a 2013 study by the Commonwealth Fund, telemedicine and remote patient monitoring have shown success in:

  • Reducing hospitalizations and health care costs
  • Improving patient knowledge, satisfaction and clinical outcomes;
  • Activating patients to better manage their own health and care.

“However, despite the potential broad-based benefits, its use is still in the early stages of adoption for most providers,” the Commonwealth Fund study reported.

Employers can pay for telemedicine on a group basis as an offering with their employee benefits. For employers with more than 1,000 employees, the cost can be as low as $120 per year per employee for unlimited access, according to the Society for Human Resource Management. For smaller employers, costs range between $200 and $300 per employee. There is also an option to pay per consultation, with costs ranging between $30 and $50. The fee can be paid either by the employer or by the employee.

One of telemedicine’s biggest challenges is finding acceptance among doctors and patients. In 2012, consulting firm InMedica reported 308,000 patients worldwide were remotely monitored for congestive heart failure, chronic obstructive pulmonary disease, diabetes, hypertension and mental health conditions. While that seems like a big number, it is a tiny fraction of the number that telemedicine could serve. The same study projected that the number would climb to nearly 2 million by 2016.

Currently, 42 states offer some sort of Medicaid reimbursement for telemedicine services, according to a Medical Economics article. Sixteen of those states require private insurance companies to provide total reimbursement for patients who utilize telemedicine. Regulatory acceptance is critical because doctors will more readily switch to telemedicine if they know there is a mechanism for being paid.

The Florida Board of Medicine passed regulations governing the Standards for Telemedicine Practice in 2014, but the provisions are fairly restrictive. The Legislature considered addressing telemedicine in 2014 as part of a larger health care bill, but the bill was defeated. It will likely be brought up again in 2015 because it’s a trend that is gaining momentum. The benefits of telemedicine are on the rise.

Over the past 15 years, reports the American Telemedicine Association, study after study has documented patient satisfaction and support for telemedical services.

For employers, telemedicine is yet another shift to the digital world — a practice that saves money and boosts productivity. The perfect prescription for cost containment for any business.

If you would like to discuss Telemedicine in more detail as an employee benefit option, please contact an Alltrust Specialist now.