Cost Reduction and Productivity Benefits of Telemedicine for Businesses

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You’re probably familiar with Telemedicine, the use of electronic communication to exchange medical information either from patient to physician or between doctors. But did you know Telemedicine is helping to solve healthcare access problems and drive down the cost of care? business healthcare costs

Telemedicine is capturing a lot of attention from employers recently, and with good reason – the benefits of telemedicine for business are clear. Medical costs are expected to continue to rise in the near future. More employers are also implementing consumer-driven healthcare plans (CDHPs), which increase out-of-pocket medical expenses for plan participants. The rise in CDHP use is prompting both employers and employees to look for ways to offset out-of-pocket costs. A popular solution for employers to fight back is Telemedicine, which is changing the way people seek and get medical advice, diagnoses and prescriptions. In an effort to lower healthcare costs and absentee rates while increasing employee satisfaction, more and more companies are adding a telemedicine benefit, with very positive results thus far.

Telemedicine conveniently and efficiently puts your employees in touch with a U.S. board-certified physician in their state to treat common ailments such as colds and flu, sinus infections, allergies, pink eye, etc. Telemedicine gives the patient direct access to a doctor 24 hours a day, seven days a week and 365 days a year, through their home phone, laptop/computer, or even smartphone video calls! The consultation can take place by a phone call, email or a web-based video call, and may include discussing symptoms, treatment options and prescriptions. Telemedicine consultations are a supplement for non-emergency treatment and visits to a primary care physician. And best of all, Telemedicine helps make healthcare affordable.

What’s the Advantage of Telemedicine for Employers?

Including Telemedicine as a part of an overall portfolio of group employee benefits has become an important healthcare cost containment tool. Telemedicine reduces office co-pays for employees and claim costs to the employer’s group healthcare plan. In a study1 of 17,000 telemedicine participants, hospital admissions dropped by 30% and doctor visits were reduced by 60% for a savings of 45% in unnecessary doctor and emergency room visits.

The American Medical Association (AMA) states that 70% of doctor’s office visits can be handled over the phone and 50% of ER visits are non-emergencies. Telemedicine’s savings in claim costs range from $300 per year for a single employee or more than $1,000 per year for a family of four.2 Rent-A-Center, a nationwide furniture rental company, saved approximately $800,000 in direct healthcare costs and employee productivity through the use of Telemedicine.3.

What’s the Advantage of Telemedicine for the Employees?

Employer Employee TelemedicineAs described above, Telemedicine provides a subscriber with quick access to a doctor over the phone, email or video call. Unlike an urgent care center, doctor’s office, or emergency room, there is no waiting for an appointment in a room full of other sick people. Telemedicine has been found to be an efficient route to care—97% of patients are treated in their first dial-in attempt with an average response time of eight minutes.4 When appropriate, the consulting doctor can prescribe a medication and send the prescription to the employee’s preferred pharmacy. This program can often eliminate visits to a primary care doctor, urgent care center, or ER and the high costs associated with those visits.

But it’s important to note that all workers in an organization—those who qualify for group benefits and those who do not—can benefit from using Telemedicine. A Telemedicine program can be bundled into your group medical insurance coverage or offered as a voluntary benefit. For employees who can’t afford to pay the premium for group benefits, or who are part-time, 1099 contract workers, or seasonal, Telemedicine can give them direct access to affordable healthcare.

5 Benefits to Using Telemedicine in Your Business:

1) It cuts down the time a patient needs to go see a doctor, especially in rural areas.

2) You get immediate help from a physician – no filling out forms and waiting in a doctor’s office surrounded by other sick people.

3) It is reported that incidents of re-hospitalization and emergency room visits are reduced by significant numbers.

4) Telemedicine can reduce health care costs by up to 27% for those who pay for medical care. It can do so because it provides care in a less expensive setting: the patient’s home or office. There are no facility charges, emergency room specialist charges, or expensive office visits.

5) Telemedicine is available now in the USA and worldwide. It is an accepted and respected modality recognized by Medicare, Medicaid, and now Wellpoint, a major private insurer.

Choosing the Right Telemedicine Partner for Your Business

Consider the following criteria when considering a Telemedicine provider for your organization:

  • Are the physicians in the vendor’s Telemedicine offering required to complete a credentialing process?
  • Is the process of reaching an actual doctor (not a nurse or nurse-practitioner) simple, convenient and fast? Vendors who promise that a caller will get a call back “within a few hours” should demonstrate this capability.
  • Does the vendor offer access via multiple contact channels–phone, email and video conference?
  • Can the doctor write a prescription when appropriate?
  • What is the complete cost of the benefit? This is an area where vendors vary greatly. Some Telemedicine vendors charge a monthly per member fee plus a copay for each call made. The vendor may set a monthly limit as to how many calls a member can make. Part of the argument in favor of Telemedicine is to help employees avoid a copay at the doctor’s office. So, look for a Telemedicine vendor who doesn’t require a copay or a maximum monthly call limit. There are a few quality vendors in the industry that charge an affordable monthly fee and offer unlimited calls per month with no copays.
  • Does the vendor take a complete survey of the patient’s pertinent medical information upon enrollment and forward the information from each call to the employee’s primary care physician? Information integration is crucial to providing proper care.
  • Finally, does the vendor have a history of proven success working with employees and helping employers save money? Ask for proof.

Implementing Your Business Telemedicine Program

A successful Telemedicine program begins with changing employee behavior toward accessing medical care. The implementation of a program should include a well-designed employee education and communication campaign on the benefits of using this service. Employers should choose a broker/consulting partner with a proven track record of designing and implementing communication and education campaigns that increase awareness and engagement in benefit programs. This will ensure a successful implementation and put both the employer and the employee in the best position to reap the benefits of Telemedicine.

2. “Telemedicine Means Great Discounts,” Employee Benefits Advisor,
3. “Telemedicine Moves Into Mainstream as More Employers Offer It.”
4. “Could Telemedicine Be a Game Changer?” Employee Benefits News.


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  1. […] AllyHealth and MDLIVE are transforming healthcare by providing telehealth services that benefit both employer and employees. Lower costs, reduced absenteeism, increased productivity, and immediate and convenient access to quality healthcare are just a few of the many benefits associated with Telemedicine Plans for Business. […]

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