Economic Evaluation of Telemedicine Consultations to Reduce Unnecessary Neonatal Care Transfers.

OBJECTIVES: To perform an economic evaluation to estimate the return on investment (ROI) of making available telemedicine consultations from a healthcare payer perspective, and to estimate the economic impacts of telemedicine under a hypothetical scenario in which all rural hospitals providing level I neonatal care in California had access to telemedicine consultations from neonatologists at level III and level IV neonatal intensive care units (NICUs). STUDY DESIGN: We developed standard decision models with assumptions derived from primary data and the literature. Telemedicine costs included equipment installation and operation costs. Probabilistic analysis with Monte Carlo simulation was performed to address model uncertainties and to estimate 95% probabilistic confidence intervals (PCIs). All costs were adjusted to 2017 US dollars using the Consumer Price Index. RESULTS: Our probabilistic analysis estimated the ROI to have a mean value of 2.23 (95% PCI, -0.7 to 6.0). That is, a $1 investment in this telemedicine model would yield a net medical expenditure saving of $1.23. "Cost saving" was observed for 75% of the hypothetical 1000 Monte Carlo simulations. For the state of California, the estimated mean annual net savings was $661 000. CONCLUSIONS: Providing telemedicine and making available consultations to rural hospitals providing level I neonatal care are likely to reduce medical expenditures by reducing potentially avoidable transfers of newborns to level III and IV NICUs, offsetting all telemedicine-related costs.

Economic Evaluation of Pediatric Telemedicine Consultations to Rural Emergency Departments.

BACKGROUND: Comprehensive economic evaluations have not been conducted on telemedicine consultations to children in rural emergency departments (EDs). OBJECTIVE: We conducted an economic evaluation to estimate the cost, effectiveness, and return on investment (ROI) of telemedicine consultations provided to health care providers of acutely ill and injured children in rural EDs compared with telephone consultations from a health care payer prospective. METHODS: We built a decision model with parameters from primary programmatic data, national data, and the literature. We performed a base-case cost-effectiveness analysis (CEA), a probabilistic CEA with Monte Carlo simulation, and ROI estimation when CEA suggested cost-saving. The CEA was based on program effectiveness, derived from transfer decisions following telemedicine and telephone consultations. RESULTS: The average cost for a telemedicine consultation was $3641 per child/ED/year in 2013 US dollars. Telemedicine consultations resulted in 31% fewer patient transfers compared with telephone consultations and a cost reduction of $4662 per child/ED/year. Our probabilistic CEA demonstrated telemedicine consultations were less costly than telephone consultations in 57% of simulation iterations. The ROI was calculated to be 1.28 ($4662/$3641) from the base-case analysis and estimated to be 1.96 from the probabilistic analysis, suggesting a $1.96 return for each dollar invested in telemedicine. Treating 10 acutely ill and injured children at each rural ED with telemedicine resulted in an annual cost-savings of $46,620 per ED. LIMITATIONS: Telephone and telemedicine consultations were not randomly assigned, potentially resulting in biased results. CONCLUSIONS: From a health care payer perspective, telemedicine consultations to health care providers of acutely ill and injured children presenting to rural EDs are cost-saving (base-case and more than half of Monte Carlo simulation iterations) or cost-effective compared with telephone consultations.

The financial impact of a pediatric telemedicine program: a children's hospital's perspective.

INTRODUCTION: This study evaluates the financial impact of telemedicine outreach in a competitive healthcare market from a tertiary children's hospital's perspective. We compared the number of transfers, average hospital revenue, and average professional billing revenue before and after the deployment of telemedicine. MATERIALS AND METHODS: This is a retrospective review of hospital and physician billing records for patients transferred from 16 hospitals where telemedicine services were implemented between July 2003 and December 2010. Hospital revenue was defined as total revenue minus operating costs. Professional billing revenue was defined as total payment received as the result of physician billing of patients' insurance. We compared the number of transfers, average net hospital revenue per year, and average professional billing revenue per year before and after the deployment of telemedicine at these hospitals. RESULTS: There were 2,029 children transferred to the children's hospital from the 16 hospitals with telemedicine during the study period. The average number of patients transferred per year to the children's hospital increased from 143 pre-telemedicine to 285 post-telemedicine. From these patients, the average hospital revenue increased from $2.4 million to $4.0 million per year, and the average professional billing revenue increased from $313,977 to $688,443 per year. On average, per hospital, following the deployment of telemedicine, hospital revenue increased by $101,744 per year, and professional billing revenue increased by $23,404 per year. CONCLUSIONS: In a competitive healthcare region with more than one children's hospital, deploying pediatric telemedicine services to referring hospitals resulted in an increased market share and an increased number of transfers, hospital revenue, and professional billing revenue.