Telemedicine’s Role in Improving Health Care Delivery

Ben Miller's picture

An interesting outcome of the continued debate over Obamacare and its implementation is the broader discussion surrounding the operation of health care in the United States and the actions that can be taken to improve quality and lower costs.

A case in point: A New York Times cover story analyzes the new federal insurance marketplaces created by Obamacare, and finds that in rural areas many suffer from a lack of competition amongst insurers, leading to more expensive premiums. The article blames this primarily on the low population density of these areas, which are not able to support enough hospitals or attract enough insurers to ensure a competitive market.

While the article does examine the possibility that competition will increase in the future with the entry of more insurance co-ops or other insurers, it makes no mention of another important force that can promote competition: technology.

Particularly in rural areas, technology has great potential to increase access to medical services and decrease costs. For example, "telemedicine," the use of information technology for remote medical consultation and other health services, not only saves health providers time and money, it is also far more convenient and less costly for patients. In addition, by decreasing the importance of location for healthcare provision, telemedicine can help increase competition and further lower healthcare spending for primary care and specialist consultations. Finally, using technology to allow health care workers to quickly serve those where there is the greatest demand will create a more efficient health care system overall and provide access to the best doctors to the largest number of patients.

Unfortunately, telemedicine has lagged behind its potential for a number of reasons. State-level licensing and credentialing regimes make remote medicine difficult. Some (but not all) insurers, adverse to change, have also been reluctant to offer reimbursement for telemedicine services. And the initial upfront costs for telemedicine implementation are often problematic, especially for poorer, rural communities.

The good news is that many of these issues can be fixed with smart policies from the federal government as well as the states. ITIF has published several reports on the benefits of telemedicine and IT in healthcare more generally, and a new report focusing on telemedicine is on the way. If we take the right steps now—removing redundant licensing restrictions and also taking clear steps to incentivize telemedicine use at the consumer level—this technology can be a real boon to our healthcare system in the near future.

About the author

Ben Miller is an Economic Growth Policy Analyst with the Information Technology and Innovation Foundation.


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