Telemedicine Could Yield $6B Annually in Healthcare Savings

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Telemedicine has the potential to deliver more than $6 billion a year in healthcare savings to U.S. companies, according to an analysis by global professional services company Towers Watson.

“While this analysis highlights a maximum potential savings, even a significantly lower level of use could generate hundreds of millions of dollars in savings,” said Allan Khoury, M.D., a senior consultant at Towers Watson. “Achieving this savings requires a shift in patient and physician mindsets, health plan willingness to integrate and reimburse such services, and regulatory support in all states.”

Thirty-seven percent of employers surveyed said that by 2015 they expect to offer their employees telemedicine consultations as a low-cost alternative to emergency room or physician office visits for non-emergency health issues, and another 34 percent are considering offering telemedicine for 2016 or 2017. Currently, 22 percent of employers offer such programs. The percentage of employers offering telemedicine is expected to rise from 22 percent to 37 percent, a 68 percent increase. These percentages are based on Towers Watson’s 2014 Health Care Changes Ahead Survey of U.S. employers with at least 1,000 employees.

It is expected that the use of telemedicine will continue to increase, driven by lower costs of telemedicine technology itself and by more insurance companies supporting telemedicine to cut costs. However, even among employers that offer such programs, utilization is low. Khoury says that vendors generally claim per-member utilization of less than 10 percent.

Among the many barriers to providing care via telemedicine, perhaps the biggest obstacle is the lack of reimbursement for telehealth services. To address the problem, a bill has been introduced in the U.S. Senate that seeks to expand telehealth coverage for Medicare beneficiaries and other patients in underserved areas. A companion bill to legislation in the House, the Telehealth Enhancement Act of 2014 would waive statutory Medicare restrictions on telehealth services in order to encourage greater use of telehealth technologies.

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