Telehealth may be the key to bending the healthcare cost curve and reducing hospital admissions, according to a report issued by the U.S. Department of Veterans Affairs.
Researchers directly compared populations of veterans who received telemedicine care to those who did not. The data showed that annual costs of telehealth patients fell approximately 4% after a year using telehealth programs, while veterans who did not use telehealth saw a 48% increase in costs. In addition to the cost reductions, veterans who used telehealth had lower hospital admission rates and fewer emergency room visits. In fact, telehealth services reduced hospital admissions by 35%. The study did show an increase in pharmacy costs for the telehealth patients, which is attributed to better prescription compliance. Still, telehealth patients saw a net savings of approximately $2000 per patient each in fiscal year 2013.
With increasing focus on improving patient outcomes and reducing overall healthcare cost, studies that show a link between telehealth and cost reductions may encourage lawmakers to reform laws that restrict Medicare patients’ access to telehealth providers. Currently, healthcare providers must be licensed in the state where the patient is located in order to receive reimbursement from Medicare. This means physicians and nurse practitioners must obtain multiple state licenses if they wish to provide services to patients in multiple states. However, the VA has no such licensure restriction. Physicians who are part of the VA network are able to treat patients in any state, so long as the provider is licensed in the state he or she is located. Lawmakers have proposed legislation, named the TELE-MED Act, that would mirror the VA model and allow providers in federal health programs (Medicare, Medicaid, Children’s Health Insurance Program, TRICARE, federal employee health plans, and the U.S. Veterans Affairs Department) to provide telehealth services to patients nationwide as long as the provider is licensed in the location where he or she is physically located. So far the TELE-MED Act received an endorsement from the American Telemedicine Association, but gained little traction on the floor.
