Is telemedicine more affordable

Is Telemedicine Actually More Affordable?

Lumeca
October 24, 2019
Is telemedicine more affordable

Is Telemedicine Actually More Affordable?

It sounds like a utopian concept; the idea that you can spend less and receive better healthcare, all from the convenience of your phone. Despite concerns of virtual healthcare, telemedicine can be a game-changer for people in rural populations, providers, and those with chronic illnesses. Virtual healthcare makes it easier to give citizens access to proper care at the touch of a button. But is it actually more affordable? 

Rising costs of traditional healthcare

Canada ranks only 28th out of 33 high-income countries in the number of physicians to population. These gaps in the Canadian health system makes it so more than half of Canadians cannot schedule a doctor’s appointment for the same day. In fact, because of the doctor shortage, the average Canadian citizen waits four weeks or longer to see a physician. During this time, mild health concerns can become time-consuming, expensive conditions. 

Plus, employer’s healthcare costs are estimated to rise 130% between 2015 and 2025. And the Fraser Institute revealed that Canadians pay double the annual healthcare costs than they did 20 years ago. For some, that’s a prohibitive cost that keeps them from accessing traditional healthcare. 

Factors like these may be why 74% of people say they are open to the idea of a telehealth visit. For most people, cost is a highly motivating factor. If this is the case for you, you have likely considered switching to telehealth. Let’s break it down to help you make the decision. But is telemedicine actually more affordable than conventional care? And if so, how does it reduce costs? 

The growing telemedicine market 

According to Business Wire, the worldwide telemedicine market is predicted to reach 12 million USD ( 16 million CAD) by 2023. The same article describes the growth “fuelled by improving healthcare IT infrastructure, aging population & rising prevalence to chronic diseases, increasing awareness about benefits of telemedicine, shortage of healthcare professionals, favorable government initiatives & reforms/policies supporting digital health, and growing focus on population health management.”

What this means for the average consumer is more competition will enter the market as it grows. North America is the largest telehealth market followed by Europe and Asia-Pacific (if you are interested, here is a list of 275 of them). 

An article titled, “Telemedicine on the rise but lagging in Canada” perhaps says it all in the name. When compared to telemedicine companies in the U.S, Canada is slightly late to the game. But new companies like Lumeca continue to grow and thrive in Canada – and provide an alternative to traditional medicine. 

Telehealth: a game-changer for rural populations 

Telemedicine is specifically useful and cost-effective if you are in a rural area. In America, remote areas often have a shortage of medical providers readily available. The distance that many have to travel, combined with raises in insurance premiums in these areas, make telehealth a more affordable option. 

Even in rural populations, most people still have access to the internet or a smart device. As of last year, 70% of Canadians owned or had access to a smartphone, which theoretically means 70% of Canadians could have access to virtual healthcare. 

Interestingly, a study JMIR conducted regarding remote orthopedic telehealth consultations and cost-effectiveness resulted in annual clinic savings of around 18,000 EUR (26,000 CAD). The patients didn’t spend extra money commuting to the specialist and the clinic was able to expand its patient base. A cost-effective move all around. Although highly specific, many are in similar situations and don’t have reliable access to necessary healthcare. Although systems like Lumeca can never fully replace traditional medicine and testing, it can provide a cost-effective first step. 

Is telemedicine economically smart? 

The question of telemedicine’s affordability requires a personal answer. Affordability changes based on an individual’s income, access to care, covered employee benefits, and geographical location. However, there are aspects to telemedicine that are highly cost-effective and could make sense for you and your particular circumstances. 

One study conducted in the U.S at the University of Massachusetts found that telehealth reduced ICU stay lengths by 30 percent, which dramatically reduced healthcare costs. For chronic health issues, telehealth decreases costs by giving patients the care and treatment plans they need from the beginning. 

Because telemedicine is a relatively newer industry, especially when paired with a smartphone, the data on exact savings are limited. There are, however, specific studies that show telehealth’s cost-effectiveness. A study from the Medical Journal of Iran breaks down telehealth’s cost-effectiveness by type of care requested. Bear in mind that these findings can vary widely between different telehealth systems. The study found that telemedicine use for cardiology, ophthalmology (specifically with diabetic retinopathy), diet, eating disorders, and psychotherapy was cost-effective. However, the study also found that using virtual health for asthma, airway cancers, and dermatology was not cost-effective enough to warrant use. 

Despite the findings, the above study took place in 2017 before advances in wearable devices and the switch to 5G began making telemedicine more effective. As technology advances, the ailments telemedicine can help increase. 

How does telemedicine reduce provider costs? 

In considering whether telemedicine is more affordable, we must also look at how cost-effective it is for providers and employers. As technology advances, the systems used for telehealth are more readily available and easier to use for providers, which reduces overall costs. “With 5G, healthcare systems can enable mobile networks to handle telemedicine appointments, which can greatly increase the reach of the program,” and wearable devices allow doctors to monitor their patients remotely which is predicted to decrease costs by 16%

In addition to this, public knowledge and demand for telehealth are increasing—a case of supply and demand. As for employers, estimates show that employee absenteeism costs about $16.6 billion annually. With telehealth systems like Lumeca, access to mental health professionals, specialists,  and physicians can help reduce that cost significantly [link to blog 3]. 

According to URAC, “On the fee-for-value side, telehealth technology is a valuable tool for delivering better outcomes and quality care at lower costs, saving money for both the patient and provider.” 

For example

Let’s say you have a large pitch coming up that will result in a nice payday for your company if you land it. Two days before, you get some unusual symptoms. Yet you hardly have time to fit in a meal, much less go to the doctor’s office. With traditional medicine, medical offices usually operate within a time frame that is not convenient for those who work full time. With telehealth like Lumeca, you can make an appointment 24/7/365, saving you time and money

Let’s flip the script and say you are the employer of said pitch-giver. As shown above, absenteeism costs billions of dollars for employers. In our imagined case this could mean the difference in whether or not you land a huge client. When employers can provide telehealth to their employees, they are setting themselves up for success as well and significantly increasing their teams’ effectiveness. 

Telehealth vs. traditional health 

If telemedicine is so cost-effective, then why isn’t everyone switching from traditional healthcare? Another complicated question, but sometimes the answer is simple: people aren’t aware of it. 

A PRNewswire study found that 39% of people with access to mobile health applications had not heard of telemedicine. The same survey broke down why consumers who had heard of telemedicine still chose not to use it: 42% prefer traditional health, 28% don’t know when to use it, 14% don’t trust virtual health, 14% were not sure about coverage, and 11% listed ‘other.’ The other side to this was asking consumers when they would consider using telemedicine: 44% said for follow-up care, 44% for symptom tracking, 44% for medication management, and 24% for mental health care. 

The importance of such statistics is to weigh the consensus on telehealth versus traditional health. With more education, access to better virtual health systems, and better rates, individuals and employees are more likely to see the value of telehealth as at least supplementary healthcare. 

It’s hard to say what the overall goals for the telemedicine industry are in terms of entirely replacing traditional health systems or not. More than likely, in the future, there will be better integration with virtual and brick-and-mortar health systems to treat consumers adequately.

Are there any downsides? 

To play devil’s advocate for a moment, we specifically searched for evidence that telemedicine wasn’t more affordable. An article titled, “Are Virtual Doctor Visits Really Cost-Effective? Not So Much, Study Says,” cited a study from Health Affairs that posited: “that telehealth prompts patients to seek care for minor illnesses that otherwise would not have induced them to visit a doctor’s office.” Their argument here was that telehealth encouraged people to seek a doctor’s advice when they otherwise would not have, which is, after all, one of the many benefits of telemedicine. 

The other argument was that telehealth systems targeted those that were more likely to use the emergency room for non-emergencies and, therefore, spend more money on their healthcare in the first place. Like all healthcare, telehealth is a personal choice, which means the individual needs to decide when to seek care. 

The study did list its limitations, stating that “researchers examined only one telehealth company and studied only visits for respiratory illnesses.” Furthermore, the data they researched was only from commercial insurance, which the mentioned “would differ among people with government insurance, high-deductible plans, or no insurance at all.” 

Although slightly contentious, it’s important to view multiple sources when deciding if virtual health is cost-effective for you. The limitations of this study showcased the importance of personal health care management and research. 

What sets Lumeca apart

Lumeca is a telehealth startup located in Western Canada. We subsist on the idea that ‘your health shouldn’t get in the way of your life.’ That’s why our plans— personal, professional and partnerships—are created for your individual needs.

Our website says it best, “Lumeca’s healthcare teams are available 24/7, so companies see an increase in primary care utilization – and a decrease in ER, and worker’s compensation claims – which reduces overall healthcare costs including worker’s compensation costs, both directly and indirectly.” To further reduce costs, we partnered with pharmacies for prescription deliveries and lower drug costs to get you better, faster. 

So, is telemedicine more affordable? 

The short answer is maybe. Because of the highly individual nature of health, the cost of care varies widely from person to person. On average, telehealth gives a broader range and more convenient access to care, saving people time and money. This is especially in remote populations.

Startups like Lumeca also serve as affordable alternatives to traditional doctor’s visits with personal and professional plans. As we mentioned, about half of all Canadians have trouble getting quick doctor’s appointments. Which can make some illnesses worse the longer people have to put off care. Furthermore, telehealth can save providers and employers money by reducing absenteeism and by technological advances that make systems more readily available.  

With so much data, the choice is truly yours. However, you’ll never know until you try telehealth and see its effectiveness in your own life.