4 Ways in which telemedicine reduces healthcare costs

Home / Education / 4 Ways in which telemedicine reduces healthcare costs

4 Ways in which telemedicine reduces healthcare costs

Health care managers who manage healthcare institutions such as hospitals, small surgeries, childbirth classes, and medical organizations face many challenges. The Patient Protection and Affordable Care Act that has been imposed by the US government grants awards to healthcare providers who reach particular quality goals and punishes the institutions that fail to reach them. As a result,  hospitals are punished, for instance, for excessive readmissions rates due to the Medicare’s Hospital Readmission Reduction Programme (nationwide, 2,592 hospitals will lose $420 million according to a Kaiser Health News analysis of Medicare records). What’s more, the health care managers also manage the finances of the institutions and fight with increasing overall cost of traditional treatment. Therefore, the biggest challenge for them today is improving the health of populations while reducing costs and maximizing value for patients at the same time. These days healthcare organizations are gradually transforming from fee for-service to fee-for-value. The department of Health and Human Services declared that half of all Medicare payments will be tied to value by 2018. Today 80% of Medicare is still fee-for service. There is  still much work to be done.

However, the implementation of telemedical solutions can help solve those problems


  1. Telemedicine helps decrease the readmission rates

Hospitals implement various strategies to decrease the rate of readmissions. Most of them focus on increasing the coordination of care and communication between providers and patients. Improved discharge planning, education, and the follow-up with patients after they are discharged are the key factors in reducing readmissions. The use of the electronic medical records will support this by enabling easy sharing of information and providing continuity of care. 

  1. Telemedicine reduces the number of unnecessary visits

Some of the traditional face to face consultations could be substituted with remote patient monitoring (monitoring of patients outside of conventional clinical settings via applications and software solutions). Medical personnel could provide continuity of care to patients who live in distant areas, monitor them remotely, and gain additional data for analysis. What’s more, telemedicine facilitates the use of medical devices which enable patients to make measurements in the home setting and send the obtained results to medical personnel on a daily basis. Such approach gives one more insight and enables doctors to make better diagnosis while reducing the need for additional visits.  

  1. Telemedicine reduces staffing costs

Recording vital signs and storing results obtained from patients doesn’t always require the presence of a doctor or nurse (patients can make simple medical measurements themselves on a daily basis and send the results to their doctor). Relatively inexpensive technology can perform these tasks not only automatically but also accurately and efficiently.

  1. Telemedicine offers the possibility to use data for further consultation

Thanks to the telehealth platforms once collected data is stored securely and it can be used by other doctors for further analysis should there be need.  Therefore, it reduces the need for constant rewriting the medical files and patients’ medical history.

Many studies confirm the effectiveness of telemedicine:

  • According to  VOX Telehealth survey 92 percent of patients enrolled in the  telehealth platform were discharged directly to home (which starts 30 days before surgery and continues until 60-90 days after surgery), while the US average is only 30 percent. Length of stay dropped to 1.6 days, nearly 50 percent lower than the US average of 3.7 days. There were 0 readmissions after 30 days, compared to the US average of 6 percent. 91 percent of patients said the program helped them to manage their expectations before surgery 91 percent were also satisfied with the overall care they received 93 percent said the platform improved their episode-of-care experience.
  • Ricoh in its study confirms that 74 percent of hospitals that use tablets or other mobile devices to collect information from patients are more efficient than those that don’t.
  • The Health Research Institute demonstrate that diabetes management shows greater savings with the use of virtual care. Hospital inpatient days decreased about 10%, physician office visits  15%,  ER visits 10%, hospital outpatient visits 5%, total change in costs 9%.
  • According to the JAMA Surgery  69 percent of the veteran participants stated they preferred a telehealth visit over the traditional in-person visit for post-surgery.

The following infographics shows more details  according to  the Health research Institute study.


Telemedicine brings new opportunities for healthcare. It shortens patients’ stay in  hospitals and cuts excessive readmissions. It improves your image, patients often express their satisfaction originating from the fact that they need to visit the hospital less frequently. The ability reach more patients across the country more efficiently can increase revenue. Patients “seen” virtually are eligible for the same third-party reimbursement as “regular” patients. The clinic can easily expand its specialties since providers can deliver telemedicine consultations from any location. This does not only expands the patient sector, but also sets doctors apart competitively which in turn can further expand the patient and revenue base.


Recommended Posts
Contact Us

You can send us an email and we'll get back to you soon.