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Hospitals Reaping Financial Benefits of Telehealth

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   July 19, 2012

This article appears in the July 2012 issue of HealthLeaders magazine.

While telehealth launched more than 40 years ago to address care for geographically isolated patients, its growth has been slow but steady. However, in the past 10 years, the growth of high-speed communication networks and the push to lower healthcare costs have made telehealth an idea that's time has finally come, and in many instances is now getting reimbursed.

Telemedicine, or telehealth, is the practice of patient caregiving through virtual office visits and virtual rounding. It encompasses the use of various information technologies and clinical applications that capture medically significant data, diagnoses, and consults. Numerous technologies are used in telehealth ranging from standard telephone connections, video conferencing, robotics, healthcare kiosks, PC webcams, iPads, and smartphones.

The passing of the years has softened resistance by patients to using this approach. Patients are now willing to forego an in-person visit with the doctor in order to get the care they need swiftly, without having to travel, and in some instances at a lower cost. Moreover, the reimbursement environment is changing. Whereas at one time payers rejected the notion of reimbursing e-health, now more are willing to pay for it. Plus, legislators nationwide are creating state laws requiring payers to reimburse for these services, though in many instances payers are doing so irrespective of mandate.

"Telemedicine can lower healthcare costs by reducing avoidable hospital visits and providing regular access to care in remote parts of the state, and it's more convenient for patients," says Georgia Partnership for TeleHealth CEO Paula Guy. The nonprofit telehealth provider works with more than 350 partners and 175 specialists and other healthcare providers and has handled some 40,000 patient encounters as of 2011.

Before GPT was started in 2005, the Georgia southeastern public health district realized it had a problem: Children with special needs in rural areas were having difficulty getting access to specialty care. It was decided that telehealth could address the care deficit but the state didn't want to wait for providers to establish telehealth programs. At the time, Georgia payers weren't reimbursing for telehealth so providers lacked the incentive to shell out the capital for the technology-driven systems needed. Instead, the public health district secured two federal grants.

"Being a not-for-profit helped us to build the kinds of relationships that got this program off the ground. Before GPT got involved some of the larger hospitals were doing some telemedicine but they saw it as a competitive advantage, so none of the hospitals wanted to play together. We were able to bring all the players together into one coordinated telehealth network," says Guy.

Karen Minich-Pourshadi is a Senior Editor with HealthLeaders Media.

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