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Does E-Health Stand a Remote Chance?

Gienna Shaw, for HealthLeaders Media, February 13, 2011
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Some states reimburse for both the provider at the consultation site and the provider at the referring or home site for an office visit. States can also reimburse any additional cost, such as technical support, line charges, and depreciation on equipment associated with the delivery of a covered service by electronic means—so long as the payment is “consistent with the requirements of efficiency, economy, and quality of care,” according to CMS. These add-on costs can be incorporated into the fee-for-service rates or separately reimbursed as an administrative cost by the state. If they are separately billed and reimbursed, the costs must be linked to a covered Medicaid service.

At the federal level, partial Medicare reimbursement for telemedicine services was authorized in the Balanced Budget Act of 1997 and was expanded under the Benefits Improvement and Protection Act of 2000. Still, there are limitations related to geographic location, originating sites, and eligible telemedicine services. And CMS says that starting this year it will expand Medicaid coverage for remote healthcare services, including chronic disease management tools.

Despite small measures of progress, payment is still a big challenge, says John P. L. Manke, RN, BSN, PCCN, who manages the telemedicine program at the two-hospital St. Joseph’s Healthcare System in Paterson, NJ.

The conventional wisdom is that payers will only be willing to fully reimburse for telemedicine services when they see hard evidence that the programs are saving them money and improving access and quality.

That proof will lie in outcomes, says Manke, including improvements in quality of care, declines in readmission rates, and increases in volume. “Our regional cranial facial center is one of four centers of excellence in this country. So let’s watch the referral base and see how many more patients are coming to us and getting the care they deserve,” he says. Insurers save money when a patient is able to see the right expert rather than seeing several different doctors before getting a proper referral and diagnosis. “Instead of spending that money and paying five docs, you’re now just paying one.”

Until there’s enough empirical evidence to sway payers, healthcare organizations can find funding in other places.

For example, they can seek out grants and funding from philanthropic sources to help pay for telemedicine programs, says Yadin David, founder and past president of the nonprofit Center for Telemedicine and eHealth Law (CTeL), president of Biomedical Engineering Consultants of Houston, and assistant professor at the University of Texas School of Public Health.

Manke says physicians can also negotiate reimbursement rates privately with payers. Beyond that, he tells them to focus on how the technology can improve their practice. “This technology allows you to deliver better quality,” he says. You might not be able to make money off of it, but the quality of care you can deliver is tenfold.”

Eventually, payers will get it, Manke says. “I see in the future, hopefully, that these insurance companies will understand, embrace, and take advantage of the technology [and] realize the benefit.”

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2 comments on "Does E-Health Stand a Remote Chance?"


Sherif E Issa (2/17/2011 at 5:58 AM)
I think at this stage; m-health or Tele-medicine succeeds better when presented as simple, mostly SMS based applications. A reminder to take your medication, or vaccination, or follow-up with pregnant women are some examples. These tools are very well accepted in developed and developing communities alike. But for more complex, fully fledged Tele-medicine applications, I can speak from my experience here in Egypt where we launched a 'Tele-Derma' project. Dermatology was an ideal candidate due to its highly visual nature.... several major entities collaborated to make this project a success – and it was – but only from a technical point. Pictures were taken, data logged in, information sent to experts and a full diagnosis + prescription was sent back.. all through broad band mobile technology; so it worked like a charm. Expert doctors were even more able to organized their schedules better, that was a bonus. On the human level however nor doctors or patients wanted to lose the 'personal' touch they enjoyed for years... some patients actually preferred to go to junior doctors in their local community where they can see and interact with him rather than get treated by an expert hundreds or thousands of kilometers away.

roger (2/15/2011 at 6:41 PM)
An excellent article, Gienna, identifying the areas that most people want to know about telemedicine and telemedicine equipment: ROI, ease of use, regulations, reimbursement. As I said, the important areas. I would suggest some other aspects that are crucial in designing the solution that best fits a practice or facility: Scalability - Is the system designed to accomodate other peripherals used in other modalities? Interoperability - Too many vendors have their own "secret sauce." In other words, the equipment they offer works with their systems, but no one else's. Connectivity - Does the equipment require special adaptors, connectors or interfaces to work with your system? If so, you're looking at a jangle of wires and cables and the likelihood that it still won't play well. Regarding Dr. Webster, we're proud to say that she chose GlobalMedia's telemedicine solutions that were designed for her needs at Loyola. Roger Downey GlobalMedia