Return on Investment is a valid concern when adding a telemedicine service line to healthcare delivery options. Generating the revenue that equals or surpasses expenses in two years’ time is considered an appropriate ROI.
One GlobalMed customer, a rural critical access hospital, tracked its telecardiology program during the initial six months. In just that short time span, the program saved $540,000 in patient transfer expenses. Benefits included the fact that 75% of the patients presenting with cardiac issues were able to be treated locally and remain in their community. The success of that program led the hospital to join a teleneurology network and to make arrangements with specialists for telepulmonology.
A 2015 California study* of pediatric telemedicine consultations to rural emergency departments produced significant ROI figures. The average cost of a telemedicine consultation was $3,641 per child, per emergency department, per year. The remote consultations resulted in 31% fewer patient transfers compared with telephone consultations and a cost reduction of $4,662 per child, per ED, per year. The ROI was calculated to be 1.28 from the base-case analysis, which means a $1.28 return for each dollar invested in telemedicine. The probabilistic analysis estimated a return of 1.96, or almost $2 for every dollar of telemedicine investment. The study authors concluded that treating only 10 acutely ill and injured children at each rural Emergency Department with telemedicine results in an annual cost-savings of $46,620 per ED.
Telemedicine offers primary care physicians the ability to extend their practices beyond the immediate community or to connect easily with patients in surrounding, smaller communities. Studies have shown that the percentage of appointments kept is higher when patients need to travel less.
Specialists who incorporate telemedicine into their practices for care and consults can save time and travel they might otherwise incur without such technologies. Telemedicine can broaden the reach of a specialist, providing an additional value.
Patients appreciate the convenience of telemedicine. Depending on the distance traveled, a doctor’s appointment may consume part of, or the whole day. For parents with young children, a trip to a distant specialist may require them to find child care or bring them along. The director of one telemedicine program covering an extensive area estimated that being able to connect with a specialist in their communities saved some patients as much as $800 in lost time from work, travel and other expenses.
*Economic Evaluation of Pediatric Telemedicine Consultations to Rural Emergency Departments