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Telehealth services do not save money

Written by Diane Archer

Over the last several years, there has been significant investment in telehealth services–which allow you to get care from a doctor via telephone or computer–as a low-cost convenient way to provide care for simple conditions. However, a recent study by RANDa non-profit research organization, finds that telehealth services do not save money. Rather, RAND finds that telehealth services can lead to additional medical treatments, increasing costs.

For the study, RAND looked at 300,000 people receiving telehealth coverage through CalPERS. Researchers found that in almost nine out of ten cases, telehealth services led to additional medical services. Only 12 percent of the time did people’s use of telehealth keep them from visiting the doctor or emergency room.

“Like some other new patient care models that promise to cut costs and reduce the hassle of receiving medical care, it appears that in some cases, direct-to-consumer telehealth may increase spending rather than trim costs,” said J. Scott Ashwood, who was the lead author of the study. Ashwood and his colleagues found the cost of telehealth services for acute respiratory infections to be half the cost of a doctor’s visit and one-twentieth of the cost of a trip to the emergency room. But, they also found that most people getting the telehealth treatment ended up getting additional care, leading to higher overall costs for their treatment.

Telehealth services have grown significantly. In 2015, 1.2 million people used these services. And, this year, the overwhelming majority of employers are offering telehealth services to their workers. The employers benefit to the extent the telehealth services allow workers to get care without leaving their office, increasing productivity. Workers can easily spend two hours traveling to and from the doctor’s office and waiting to be seen by the doctor.

Of note, these same RAND researchers found last year that local health clinics also do not end up saving money on care. They found that more than half of all visits to these retail clinics for simple health needs were additional services, not replacements for doctors’ visits.

Medicare covers some telemedicine services, both real-time audio and video, for some conditions in certain situations. If you don’t have Medicare, check with your commercial insurer about the coverage available through your plan.

While Medicare only covers limited home care services, it is now in the midst of a demonstration project that pays for doctors and nurse practitioners to make house calls. That could be a better option than telemedicine.

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