Telehealth Can Save $126 per Visit

Substituting telehealth services for in-person visits can generate savings of roughly $126 per commercial telehealth visit, according to a new actuarial study from the Alliance for Connected Care.

The study used data from 5 telehealth companies in the commercial sector: Teladoc, Anthem, American Well, Doctor on Demand, and Optum. According to the Alliance, the study underscores the need for policy reform and highlights the potential savings.

“The findings dispel many of the concerns about adding telehealth services for acute care in Medicare,” author Dale Yamamoto, of Red Quill Consulting, said in a statement. “Reimbursing for telehealth will not increase Medicare expenditures, and it will provide an easy alternative for beneficiaries to get quality healthcare.”

The average estimated cost of a telehealth visit is $40 to $50 per visit, compared with $136 to $176 for the average in-person acute care visit. Using the higher end for both visits, Mr Yamamoto estimated telehealth visits save approximately $126 per visit. In Medicare, replacing acute care services with telehealth visits, which are reimbursed at the same rate, could save Medicare $45 a visit. Furthermore, the study found that 83% of telehealth visits resolved issues during the initial visit.

Krista Drobac, executive director of the Alliance for Connected Care, discussed CMS lifting restrictions on telehealth for the final ACO rule in this month’s American Journal of Accountable Care, a publication of The American Journal of Managed Care.

Some Medicare Advantage plans have start offering telehealth, but most seniors in fee-for-service Medicare lack access to these services because of restrictions in the statute, according to the Alliance.

The study also dispels concerns that the convenience of telemedicine will cause overutilization. Mr Yamamoto found that the average number of telehealth visits across vendors was just 1.3 visits per patient per year. Since telehealth visits are used to treat fairly routine, non-emergent conditions, such as sinusitis, colds, and urinary tract infections, telehealth can replace unnecessary in-person visits to the emergency department or urgent care centers.

“This study is another step toward demonstrating the value proposition of telehealth in Medicare, and dispelling the myth that telehealth will increase costs to Medicare,” Ms Drobac said. “It’s time to change the statute and give seniors access to telehealth services.”