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Telehealth: Separating Fact and Fiction

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Mark Allphin, Senior Research Director, KLAS

Telehealth is a common buzzword in healthcare IT these days. But is it actually happening? What does it actually look like? And is it worth it? These are questions KLAS is working to answer in our upcoming report.

There are a lot of potential benefits of telehealth, though many are still unrealized, as the space is still so new for so many providers.

  1. Telehealth in its many, varied forms is ultimately intended to facilitate a fully connected continuum of care; this expands patient access to care, improves care efficiency, and improves the patient care experience overall.
  2. Through virtual visits, patients who would otherwise have to travel long distances to get to the doctor’s office can save time and money – two factors that can prevent sick people from getting care. So virtual visits mean healthier patients.
  3. One of the biggest financial and health-related benefits of telehealth is for patients with chronic conditions. Sick patients who don’t get the care they need become sicker patients. The sickest patients make up the biggest chunk of healthcare spending. But if it’s easier for chronically sick patients to stay in touch with their care team, they’re less likely to show up in the ER with an acute condition. This helps the provider, the payer, and the patient spend less overall. In 2015, healthcare spending made up a whopping 17.8 percent of the US GDP. That percentage is significantly higher than any other country, and according to life-expectancy numbers, we aren’t benefitting from that higher spending. There are a lot of different reasons for that disparity, and there is likely no quick fix. But easier, more consistent care for patients with chronic conditions could make a dent.
  4. In a similar vein, telehealth could help reduce the costs that come along with a physical clinic and on-site patients. This could save providers money and also allow funds to be redirected to areas that need it.

While many providers are excited about the potential of telehealth, they remain cautious because of a few major barriers.

The first is that financial incentives aren’t quite aligned yet. CMS coverage for telehealth services is lacking and progress is slow, leading other payers to hold back as well. Because coverage is sparse, reimbursements depend on a lot of different factors, such as location, technology used, and type of care given. Ideally, the move from fee-for-service to value-based care could help drive financial incentives for telehealth, but value-based care is still emerging, too.

The logistics of what telehealth looks like can be tricky to nail down as well. Since this is such a new area, provider organizations often have to put in a lot of time and research to set up their own programs and figure out the logistics of how telehealth will work for their organization.

Providers also have questions about usage. Will patients overutilize telehealth services? Whether these services require a co-pay or other similar usage fee might affect usage as well. But as mentioned before, there are multiple types of telehealth right now, and there isn’t much concrete data on telehealth utilization.

Another question providers have is the real care value of telehealth; some are skeptical that remote services can be as helpful as in-person visits. How can doctors maintain a good connection with patients through virtual visits?

Despite all of these barriers, telehealth is happening. There is movement in the market, and KLAS hopes to give providers the information they need about what is out there so they can choose the best solutions for their strategy and make telehealth a viable, valuable offering.

In our next column, Bret Sharp will share more about our upcoming telehealth report and what’s actually happening in the market today.

This piece, written by Senior Research Director Mark Allphin, is the first in a two-part blog series focusing on telehealth. For more information about KLAS, click here. To follow KLAS on Twitter, click here.

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