The Growing Adoption and Trends in Telemedicine
By Jesse Oberloh, GBA, Benefits Consultant
Formally defined, telemedicine is the use of medical information exchanged from one site to another via electronic communications to improve a patient’s clinical health status. Telemedicine includes a growing variety of applications and services using two-way video, email, smart phones, wireless tools and other forms of telecommunications technology.
Telemedicine is a key component in the health care industry shift to value-based care as a way to generate additional revenue, cut costs and enhance patient satisfaction. One of the biggest changes to health care in the last decade, telemedicine is experiencing rapid growth and deployment across a variety of applications.
The quick market adoption of telemedicine is fueled by powerful economic, social, and political forces — most notably, the growing consumer demand for more affordable and accessible care. Patients both young and old have embraced this new form of medicine. These forces are pushing health care providers to grow and adapt their business models to the new health care marketplace.
Research conducted by the American Telemedicine Association reveals that telemedicine saves money for patients, providers, and payers compared to traditional health care practices. It does this by helping reduce the frequency and duration of hospital visits.
According to a new report from Tractica, consumers utilizing home health technologies will increase from 14.3 million worldwide in 2014 to 78.5 million by 2020.* The market intelligence firm anticipates that medical monitoring, diagnosis, and treatment will be the largest application market during that timeframe, and will drive the deployment of a wide variety of connected health devices and software applications. Other key segments of this market are remote consultations, eldercare, and health and wellness. *https://www.tractica.com/research/home-health-technologies/
The following key trends will drive telemedicine’s continued growth and transformation of health care delivery in 2016 and beyond:
1. Expanding Reimbursement and Payment Opportunities
Both private and government payers will continue to expand telemedicine coverage as consumers gain experience with the technology and increasingly demand access to telemedicine-based services. Some health plans have already begun bolstering their coverage of telemedicine, which they view as a form of value-based care that can improve the patient experience and offer substantial cost savings. In 2016, the government expanded more coverage for these services among Medicaid managed care organizations and Medicare Advantage plans. Now 86% of states cover telemedicine services statewide without distance restrictions or geographic designations.*
2. Continued Momentum at the State Level
State governments across the U.S. are leading the way in telemedicine expansion. According to a study by the Center for Connected Health Policy, during the 2015 legislative session, more than 200 pieces of telemedicine-related legislation were introduced in 42 states. Currently, 29 states and the District of Columbia have enacted laws requiring that health plans cover telemedicine services.* While Wisconsin is not one of these states, many of the national as well as local health insurance carriers now provide coverage for various telemedicine services. Neighboring states, Minnesota and Michigan have passed laws requiring coverage and both Iowa and Illinois have proposed bills in 2016. In 2017, we will see more bills supporting health insurance coverage for telemedicine-based services introduced in various state legislatures and a growing pressure from the federal government to have these state coverage requirements to mirror those enacted for Medicaid and Medicare Plans.
3. More ACOs Using Technology to Improve Care and Cut Costs
2016 has been the year of telemedicine and ACOs. Since the advent of Medicare Accountable Care Organizations (ACOs), the number of Medicare beneficiaries served has consistently grown from year to year, and early indications suggest the number of beneficiaries served by ACOs is likely to continue to increase in 2017 and beyond. These organizations present an ideal avenue for the growth of telemedicine. While CMS offers heavy cost-reduction incentives in the form of shared-saving payments, only 27 percent of ACOs achieved enough savings to qualify for those incentives last year. Meanwhile, only 20 percent of ACOs use telemedicine services, according to a recent study.*
Telemedicine has proven to save time, save money and, most importantly, save lives. As the technology continues to improve, so will level of services being provided through telemedicine. Review you current benefit plan to determine what telemedicine services are covered and available through your health plan and contact your carriers for employee education and communication materials available to help promote these services.
Jesse capitalizes on his 15 year background in risk management and account services to develop benefit programs for employers in a way that improves the overall health and productivity of the workforce. He is an expert in alternative funding methods for insurance including self-funded, limited funded and captive plans. By staying well informed on the latest industry trends, Jesse is able to provide proactive and strategic solutions for benefits clients. He is a member of the Wisconsin Association of Health Underwriters and participates in local community chambers and SHRM chapters.