Telemedicine has rapidly evolved from a means to fulfill outstanding care needs to a platform for delivering innovative and collaborative care by leveraging physicians from multiple sites.
What began with simple phone consultations to provide timely access to specialists in areas where physician recruitment remains challenging has expanded to include a host of technological advancements -- from electronic data transfer to remote monitoring systems to video conferencing and remote-controlled surgical robots in the care delivery process. Such innovation also helped facilitate telemedicine applications to include patient care management, remote patient monitoring, image review and consultation, medical education and other services.
Hospital investments in these technologies have increased access to care in rural areas, improved outcomes, and reduced unnecessary emergency department visits and readmissions. In addition, telemedicine technology has reduced complication rates and mortality in many cases -- a win-win given our national health care goals of improving care quality and reducing costs.
From the hospital's perspective, once the initial infrastructure is set up, adding new applications has minimal costs. In essence, hospitals can get multiple uses from the same investment. Furthermore, with an aging work force and shortage of specialists in rural areas, telemedicine has enabled hospitals to elevate the productivity of their scarce resources by limiting clinician travel and allowing them to see more patients in the same time.
Barriers to Investment and Utilization
Despite rapid innovation in telemedicine and all the benefits to patients, hospitals and payers, adoption of the technology remains low. So it was not surprising that the American Recovery and Reinvestment Act of 2009 allocated $2.5 billion for investment in the broadband infrastructure needed to grow telemedicine programs.
However, despite an infusion of federal dollars, hospitals are still unlikely to invest heavily in telemedicine programs in the near term. Hospitals are already stretched thin, as they tackle the effects of the economic downturn, which has produced slim margins and a leaner work force. Furthermore, the slate of new federal mandates, including migration to ICD-10 and demonstrating "meaningful use," are demanding large capital investments at a time when hospitals are struggling to keep their doors open.
Needless to say, few hospitals have the financial or resource bandwidth to invest in telemedicine programs that not only require upfront technology investments but also ongoing funding to maintain and staff. Furthermore, in many cases, hospitals are forced to assist the remote, partner hospital with upgrading its antiquated systems -- another financial barrier to adoption for the immediate future.
In reality, the total expense for establishing a telemedicine program and supporting it is not unpalatable for most hospitals. Prior to the downturn and even today, the deal breaker for most hospitals has been the lack of reimbursement for telemedicine services. Only about half of all private payers reimburse for some telemedicine services and to date, only 27 states offer Medicaid reimbursement for select telemedicine services.
Medicare also restricts telemedicine reimbursement to patients residing in Medical Shortage Areas or rural health professional shortage areas -- which makes little sense given that health professional shortage areas are designated based on a shortage of primary care physicians, whereas telemedicine is about providing access to specialists.
Making matters worse is the additional hit hospitals take on their revenues from the reduction in admissions and ED visits due to improvements in care quality -- in essence a double whammy for hospitals that not only receive no reimbursement for their telemedicine services but instead see their revenues decline due to these programs.
Going beyond reimbursement, the legal liabilities of providing remote care delivery also will continue to hamper telemedicine adoption. Hospitals are already responsible for protecting patient data within their four walls, but with any telemedicine program, hospitals will face the additional burden of ensuring patient privacy and securing health information exchanged between the hospital and the remote facilities. With little precedent on malpractice lawsuits for interstate telemedicine practices, many health care providers are reluctant to offer diagnoses and treatment in a virtual environment. Furthermore, differences in state practice regulations impede physicians' ability to practice across state lines.
Required Policy Changes To Drive Widespread Adoption
Needless to say, more than just federal grants are needed to drive growth in telemedicine programs. Changes in reimbursement and legal policies will greatly determine whether telemedicine programs flourish.
From a financial perspective, hospitals should not only be reimbursed by all payers for these services, but more importantly, they also should be compensated for revenues lost because of reduced admissions and ED visits. Hospitals should receive additional incentives for improving care through telemedicine.
Furthermore, emerging telemedicine solutions should be eligible for CMS' Coverage with Evidence Development, or CED, program where hospitals are reimbursed for using cutting-edge devices and technologies in care delivery in exchange for allowing CMS to collect data to determine the technology's efficacy. Such a policy would not only accelerate adoption of new telemedicine applications but would also spur innovations in care delivery.
From the legal angle, the government should prioritize the development of standards for sharing relevant patient information between sites of care and protocols for clinical interactions in the virtual setting to reduce hospital and physician vulnerability and risk associated with electronic patient data exchange. This will not only standardize clinical practice as it relates to telemedicine but will also reduce variations in care, driving even greater outcomes. Finally, to the extent possible, standardizing physician telemedicine practice requirements across state lines will garner the physician support necessary for successful telemedicine programs.
Without alignment of incentives between payers and hospitals through changes in reimbursement and a revisiting of regulations associated with sharing patient information for remote care delivery, our industry will be unable to capitalize on the value of these innovations to reduce disparities in care, cut costs associated with unnecessary admissions and ED visits, and improve the quality of care through better and more timely access.