Kalorama Information uncovers five reasons why telehealth will soon take off
ROCKVILLE, Md. — Market researcher Kalorama Information on Wednesday estimated there is a $17 billion market for telehealth worldwide in its recently published study "Telehealth and Patient Monitoring Markets."
The reasons for using telehealth are many, including improved access to healthcare for patients in remote locations; cost effectiveness; and patient demand. But the concept hasn't taken off, Kalorama noted, at least not yet.
"The concept is great but in devices, rubber hits road in reimbursement and pricing," said Bruce Carlson, Publisher of Kalorama Information. "Who pays for the equipment, the ongoing services and the software? The result of these collective decisions is where a market is created."
In addition to researching financial results and interviewing equipment makers, Kalroama surveyed provider end users of telehealth equipment. Kalorama found that the following is true about the telehealth market today:
Telehealth is no fad. Use grows every year. In the United States, on demand telehealth has increased by about 20% annually, with about 1.1 million patients using these services in 2016. Overall, the average number of televisits is between 3 and 3.5, which generates upwards of 3.7 million visits for 2016. Services billed for telemonitoring in the U.S. amount to about $270 million for 2016. This is calculated using a $73 average visit cost and taking the middle average for visits of 3.25 million;
This is not just a U.S. concept. There's a lot of attention on this issue in the U.S. market, but vendors are marketing around the globe: $4 out of every $10 generated in this market is generated outside the U.S.;
Referrals and prescriptions drive telehealth. Kalorama's survey found that many of the providers offered data regarding drug prescribing and referrals during a telehealth visit. Of the providers surveyed, estimates for prescribing drugs ranged from 20%-40% of all visits and referrals to other providers were reported at 15%-20% of visits;
Reimbursement is an issue but an improving one. Without reimbursement, most medical device concepts fail. Telehealth can still be useful even if a payor declines as there is a provider buyer market. Still reimbursement is important for future growth. Most providers reported barriers to using telehealth technology or implementing systems due to reimbursement issues. On average, it was ranked at 7.22 on a scale from 1-10 as being the most significant cause of delay for implementing a telehealth system. Still, this situation is getting better. Reimbursement policies for telemedicine, telehealth, telemonitoring or any remote monitoring vary widely by U.S. states. In recent years, a number of states have continued to adopt legislation, which includes live-video telemedicine/telehealth services and reimburses at comparable levels and rates as in-person visits. Effective Jan. 1, 2017 the Centers for Medicare and Medicaid Services changed the reimbursement calculation structure for remote monitoring services. For many service providers, this resulted in an increase in reimbursement for 2017; and
Mental health is an opportunity area. Telemedicine in the area of mental health disorders and conditions is often referred to as telemental health or telepsychiatry. One area of mental health therapy is PTSD a type of anxiety disorder brought on by very traumatic situations such as war. According to the National Institute of Mental Health, approximately 8 million adult Americans have PTSD in a given year. In the past, PTSD was considered a 'weakness' and this often lead to early military discharge or other peer rejection.