Friday, September 11, 2015

Will Telemedicine Save Money?

Telemedicine (or telehealth) in the specific form of video chats with doctors seems at last to be taking off in U.S.A. The latest development is a Sep. 8, '15 article in the Annals of Internal Medicine voicing qualified support by the American College of Physicians (ACP). An earlier Aug. 4, '15 report says the U.S. will have an over 40% share of a global telemedicine market projected to grow to over $34B by end of 2020.

Articles on Aug. 2, '15 in the Wall Street Journal and on July 11, '15 in the NY Times describe U.S. patients Skyping with doctors and insurers covering such consultations. This is despite strict constraints and push backs by many doctors and payers. Such video visits can save the time and expense of going to emergency rooms and physician offices, and cost as little as $40 to $50 each. Will such telemedicine save money overall? 

I agree with the expert in the Times article who says no, though it adds a lot to patients' convenience and access to care. That's because any savings in per consultation prices will likely be more than offset by increased demand by patients who otherwise may have done nothing and stayed at home. But I make an important distinction.

We will not save money if we have telemedicine in its present form with only U.S. trained doctors allowed to practice it. On the other hand we'll actually save an immense amount of money and enormously enhance patient benefits if we do it the right way as envisaged in my post going back to April 2011. The difference: allowing patients to be served by highly qualified foreign doctors who are licensed after clearing U.S. board exams but without U.S. residency requirements. This will overcome the deliberately engineered shortage of U.S. doctors described in my Sep. 2010 post that keeps fees and prices high. Moreover, the scope of telemedicine can and should be vastly enhanced, so that foreign specialists and surgeons treat patients remotely, with on site nurses or other staff assisting as needed.

If we allow good foreign doctors into telemedicine their fees are likely to be a third or less than that of U.S. trained doctors. Some of these doctors from places like India are actually a lot more experienced as well, because they serve many more patients in the same period of time, and because they start their careers earlier. That's because medical schools outside the U.S. and Canada take in high school graduates instead of college graduates. That gives foreign medical graduates a four year career head start in addition to avoiding costly and unnecessary education. Top surgeons in their mid thirties in India have performed as many procedures as typical U.S. doctors in their fifties, and they achieve better outcomes.

Other improvements we need in telemedicine are around IT, better electronic health records (EHRs), automated billing systems, rapidly accessing other (remote) specialists when required, and so on. Advances like Da Vinci machines make remote complex surgery feasible (with safeguards and back up systems, of course.)  All this can rapidly evolve over time. The main constraint is U.S. policies and doctor lobbies keeping domestic supply constrained and foreign providers at bay. To significantly lower medical expenditures this is the key problem to be addressed by our political leadership. 


Avay Shukla said...

Totally agree. One doubt, however: when you say that the costs of telemedicine may not be significantly less than the current process, have you factored in things like time lost in making visits to clinics, cost of commuting, reduced infrastructure costs for the doctor, etc?
The real benefit of telemedicine, however, could accrue to countries like India where rural areas are still woefully short of doctors and medical institutions, and road networks are very poor. I have in mind a state like Himachal Pradesh, with which you are familiar, Sandip. Villages are widely scattered and Primary Health Centres-few and far between- ill equipped to handle serious cases( though a doctor two will usually be there). Through telemedicine these PHCs could be connected to district and referral hospitals, from where senior physicians could advise and guide their PHC counterparts on the treatment of such cases. Not only would this make medical care available at ( almost) the doorstep, it would certainly be at a far lesser cost to both the government and the patient.For such areas telemedicine would not only be a convenience( as in more affluent countries) but a life saver.

Sandip Madan said...

Great point, Avay. I was referring to potential savings for taxpayers, employers and other non-patient payers in U.S.A. while assessing telemedicine here. But from the viewpoint of patient access and convenience, telemedicine can be hugely beneficial, and even more so in remote areas in U.S.A., not to speak of Himachal, where the problems can be orders of magnitude worse.