Cost Benefits of Telemedicine


Nursing homes provide a safe and secure environment for patients that are no longer able to take care of themselves independently. Telemedicine provides a cost-effective method for nursing home staff members to continue with their commitment of care for their clients. So how does telemedicine accomplish this? The quick answer is, by keeping the patient in the nursing home and out of the hospital.  

Let's see how telemedicine can help our resident, Elaine

It’s a Sunday afternoon, Elaine, a nursing home resident, complains of shortness of breath to the nursing staff.  Prior to having enrolled in a Telemedicine service, this nursing homes course of action would have been to call an ambulance to transport Elaine to the nearby hospital.  In this scenario, Elaine would have spent several hours there, feeling anxious, and exposed to unnecessary health risks. To compound the situation, there would be Medicare costs for the ambulance ride and hospitalization. 

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The good news is, in this scenario, the nursing home had enrolled in a Telemedicine service! The staff member was able to immediately contact a doctor who was able to accurately diagnose Elaine with acute bronchitis. The doctor provided instructions to the nurse to start nebulizer treatments and called in a prescription to treat the infection and alleviate the symptoms.  Elaine was back to playing mah jong by Tuesday afternoon. 

How does telemedicine help nursing homes save money?

This example illustrates how telemedicine provides a quick solution for a nursing home resident in need of medical attention.  Let’s talk numbers.  The Office of the Inspector General issued a report showing $14.3 billion was spent on these hospitalizations in 2011. report by the Kaiser Family found that 30-67 percent of hospitalizations could have been prevented with intervention, using technology such as telemedicine.  That would be a savings of $4.29 billion a year to as much as $9.58 billion a year.  

To put this in perspective for costs to nursing homes, the study conducted by TeleHealth Solutions found that the average savings to Medicare for nursing homes using Telemedicine services would be between $120,000 to $151,000 per nursing home per year. 

It’s easy to see that Telemedicine provides significant savings to Medicare costs for a nursing home facility.  More importantly, the savings to the emotional and physical toll for patients like Elaine is tenfold.  Nursing homes are in the business of taking care of their patients, and Telemedicine is in the business of making sure they can do that efficiently and effectively while reducing costs. 

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