NCPA - National Center for Policy Analysis

Telemedicine Use Is Rising

March 12, 2014

Telemedicine has already been used by more than 36 million Americans, says the Fiscal Times.

Telemedicine is essentially the practice of medicine over Skype -- it allows doctors to see patients via a video connection.

  • Some insurance companies are already establishing services for the insured who utilize telemedicine services rather than visiting the doctor's office in person. Such services typically cost less than an office visit.
  • Up to 70 percent of doctor visits can actually be handled over the phone.

But not all insurance companies reimburse doctors for telemedicine services, and Medicare currently only reimburses doctors for telehealth services if patients are located outside city limits or in an area with a shortage of providers.

The main selling point of telemedicine is its potential cost savings.

  • A study by the Center for Information Technology Leadership determined that cutting down on emergency room transports (moving patients from one emergency department to another) by using telemedicine could save $537 million per year and avoid 850,000 transports. More than 2 million patients are transported between emergency departments every year, costing $1.39 billion.
  • Health Affairs researchers found that chronically ill Medicare enrollees that used telehealth reduced their spending by 7 percent to 13 percent per quarter ($312 to $542 per person) more than those who did not.

Federal lawmakers are looking at ways to encourage this type of alternative care by requiring federal health programs to accept telemedicine care.

Source: Brianna Ehley, "Can 'Docs in a Box' Save the Health Care System?" Fiscal Times, March 5, 2014.


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