How Big IS Telemedicine?

If I had a nickel for every time I was asked this question...

There are some interesting facts that have recently come out about the telemedicine market (explained below). However, much to the consternation of many reporters and entrepreneurs, there is no single answer to this question for four good reasons:

1. Transparency - Telemedicine is not a separate specialty. In fact, many successful applications of telemedicine are simply folded into the normal clinical practice. A patient may come in to see a dermatologist from the waiting room or online or the doctor may have a case sent via email. Unless there is a specific billing or administrative reason the services may never be coded to reflect the modality used in delivering the service. This is probably most apparent in radiology where millions of reads are provided each year and it never matters (and is seldom tracked) whether the radiologist is next door or a thousand miles away.
   
2. Multiple payers - Back to the radiology example: that read can be billed through Medicare, Medicaid, a hundred different private payers, or inside a closed system such as the U.S. Veterans Administration or another country's socialized health plan. Even if it were identified as a "remote" service, going to each payer and extracting the data would be impossible.
   
3. Equipment or service? - When someone asks about the market they could be referring to how much equipment is sold, the value of the health services provided, or the revenue generated by associated vendors such as telecommunications companies.
   
4. What is telemedicine? - Interactive videoconferencing, remote monitoring, consumer-based wireless health, remote interpretation of medical images and internet-based medical education are all part of telemedicine.

However, a few recent studies have revealed that we are now talking about a multi-billion dollar market with double digit growth. Here are three recent reports:

• Wireless devices that monitor patients' condition and report the data to health care providers are expected to show a 77 percent compound annual growth rate resulting in global revenue of almost $950 million by 2014, according to a new study from ABI Research. The group also concluded that over the next five years the market for wearable wireless sensors is set to grow to more than 400 million devices by 2014. Demand will come from the professional healthcare, home healthcare and sports and fitness markets, but these markets will develop at different speeds and will support different applications. The sports and fitness market represents more than 90 percent of the market today.


• According to a recent report from Parks Associates, the U.S. market for wireless home-based healthcare applications and services will grow at a five-year cumulative annual growth rate of over 180 percent and become a $4.4 billion industry in 2013.


• In 2008, the global videoconferencing market grew 24% to $2.4 billion, according to Roopam Jain, a technology analyst at Frost & Sullivan. The firm forecasts the market will more than double, to reach $5.7 billion by 2013.

Another study documenting savings from remote monitoring
– how many more do we need before change is made?

A study just published by the Journal of Medical Internet Research (J Med Internet Res 2009;11(3):e34) looked at the use of home-based telemonitoring on a group of patients using mobile phones. The study, conducted in Austria, was based on a group of 120 randomly selected CHF patients divided into a control and “tele” group. The results were predictable, “home-based telemonitoring using mobile phones improves outcome in CHF patients and reduces both frequency and duration of heart failure hospitalizations.”

Other research studies have reached similar conclusions. A study published last year about the use of remote monitoring in the Veterans Administration documents a 19% reduction in hospital admissions and 25% reduction in the days of care. A systematic analysis of telehomecare studies published last year (Telemedicine and e-Health November 1, 2008, 14(9): 896-904. doi:10.1089/tmj.2008.0009), concluded that total cost, cost per patient and cost per visit were all reduced by telehomecare.

So, with this growing string of academically sound research studies documenting significant savings from the use of remote monitoring, why haven’t governments and payers leaped at the use of such services? The well-worn conclusion, especially by researchers, is that more research is needed. However, a load of other healthcare policy decisions have been made based on considerably less documentation and much less experience.

One problem appears to be the age-old silo mentality that resides with governmental budget and private insurance analysts as well as separate department administrators.

For example, much of the savings from remote monitoring appears as reduced use of hospitals and emergency rooms. However, achieving such savings means a small investment in home telehealth services, traditionally pigeonholed within “home care” or “home health visits” by departments. Many analysts and administrators of those departments only see home telehealth as increasing costs. They don’t recognize or care about savings accrued in other areas.

It is the “that’s not my department” view that has retarded the use of telemedicine in many areas.

All of us who care about telemedicine and see what a difference it can make need to be aware of this issue. As health reform in this country as well as other countries is implemented, we need to explain that the benefits of telemedicine spread throughout the health care system. It can fundamentally change the way health care is provided and positively affect many different areas.

Telemedicine is Changing and ATA is Evolving

The world of telemedicine, is changing rapidly and radically. ATA is also undergoing significant change. I want to share a couple of these changes with you and explain why they are occurring.

Building on the foundation of programs and services established over 17 years, ATA is realigning our activities, our structure and even our look to ensure that the organization continues to be current, healthy and a change agent for the use of telecommunications technology in healthcare. Two weeks ago, ATA’s new board of directors, under the leadership of ATA President, Dr. Karen Rheuban, affirmed the critical need for ATA to set forth a bold vision for the delivery of healthcare in the future and move aggressively to make such a vision come true, both in the United States and around the world.

ATA’s Leadership: Over the past two years, the composition of the Association’s board of directors has changed dramatically. This reflects the evolving nature of telemedicine and the diverse roles it plays in the delivery of healthcare. Complementing the historic core of ATA’s board, which includes leading administrators of telemedicine programs, academic experts and healthcare providers, is a new group of world-renowned leaders in a number of parallel fields. They include:

• S. Ward Casscells, MD, former Assistant Secretary of Defense for Health Affairs
• Molly J. Coye, MD, MPH, President and Chief Executive Officer, CalRHIO
• Bernard Harris, MD, Founder of the Harris Foundation and CEO of Vesalius Venture Capital
• Don Jones, Vice President, Business Development Health and Life Sciences, QUALCOMM
• William Paschall, Director of Healthcare Applications, AT&T, Inc.
• Lord Roger Swinfen, Member of the UK House of Lords and Founder of the Swinfen Charitable Trust
• Reed V. Tuckson, MD, Executive Vice President, Chief of Medical Affairs, UnitedHealth Group
• Yulun Wang, PhD, Chairman & CEO, InTouch Health

Full bios ATA’s entire board is available at www.americantelemed.org/i4a/pages/index.cfm?pageID=3329

Communications: Web 2.0 and social networking are important tools for networking, training and innovation in healthcare delivery. ATA is an early adopter of such new technology in order to foster growth and change. This moves beyond using Facebook, LinkedIn and Twitter to communicate ATA’s message. It involves using technology to fundamentally transform the way information is created and decisions are made. ATA’s use of list serves, its presence on the Internet and use of social media are all expanding. For example, a variety of new content partnerships with Meltwater News, Homecare Technology Report and others will make both the front page and many inside sections of ATA’s web site much more dynamic and relevant to a variety of users. Changes in communication networks, open content and open databases will foster to new dialogues, sharing of information and create new ideas and products across a broad spectrum of interests.

Public Policy: Public policy has always been a key priority for ATA and this year it is more important than ever. But, like never before, it is apparent that we can’t do this alone. Development of an online petition, http://www.telehealth4us.org/, has provided a vehicle to gather outside support for telemedicine and has been wildly successful with hundreds of associations, healthcare providers and individuals signing on. We continue to reach out to additional provider and consumer groups, public interests and others to demonstrate broad-based support of telehealth legislation. We have also recently added a State Telemedicine Policy Center website focused on state government activity affecting telehealth - notably insurance laws, Medicaid and telehealth networks. We are steadily expanding it with our compiled information. We will need your collaboration to keep it current and accurate.

Let me hear from you.