Securing the Benefits of Telehealth in Home Care

The Evidence on the Value of Telehealth Keeps Getting Stronger…
Can Home Care Agencies Attain its Benefits?

Perhaps no home care technology research efforts are more pertinent and less understood today than the ones that attempt to establish a causal relationship between home telehealth systems use and patient outcomes. Every new piece of evidence is welcome, yet the industry in general remains unconvinced.

Absence of reimbursement for scarce dollars spent on home telehealth equipment is only part of the industry's rationale. Utilization has been hovering around the 5% to 15% (depending upon who is reporting it) level for years, no matter how many reports surface from agencies that lower costs and improve care, effectively making the system pay for itself. What is necessary to eliminate scepticism remains unclear but one would think continued evidence can only help.

Home Care Automation Report is committed to continue to present readers with such evidence. This week's offering comes via the courtesy of the industry's home telehealth providers, who presents a compelling case for our readers to add to their decision-making process.

Promising news continues to arrive indicating that the ability to transmit patient information in real time can yield significant results. Whether the chosen technology links health care providers to patients at home for remote monitoring or for direct consultation via telehealth video visits, expert care can be provided today without regard to geography. No matter where patients may live, they can connect to clinical expertise matched to their health conditions and care requirements.

How large is the potential value of telehealth? Evidence grows stronger as research continues to demonstrate the technology's potential. In March 2008, the Deloitte Center for Health Solutions, part of Deloitte LLP, issued Connected Care: Technology-enabled Care at Home, a paper exploring technology-enabled, home-based telehealth as one solution to stem the tide of rising health care utilization and costs.

The Deloitte paper’s conclusion: The effective application of in-home technologies leads to increased medication adherence, reduced avoidable post-acute complications, and improved self-care in the management of chronic conditions. The net result is a potential annual savings of 20 percent or more – a $400 billion savings to the U.S. health care system.

“The question home care agencies confront is whether they can secure the benefits of telehealth that research shows are achievable,” said Randy Moore, M.D., M.B.A., chairman and chief executive officer of American TeleCare, Inc. (ATI). “And they have to figure out how to make telehealth pay off in their operations.”

Telehealth Research Update
Robert E. Litan, a researcher affiliated with the Kauffman Foundation and the Brookings Institution, recently summarized and assessed the findings of more than a dozen telehealth research studies in his October 2008 report for the "Better Health Care Together" coalition of business, labor and public policy leaders. In Vital Signs via Broadband: Remote Health Monitoring Transmits Savings, Enhances Lives, Litan concluded that telehealth-supported care processes can prevent downturns in patients’ health conditions and thereby reduce emergency room visits, repeat hospitalizations and skilled nursing facility utilization.

In the randomized controlled studies he reviewed, reductions in emergency room visits versus the control groups range from 19 percent to 59 percent. In ten studies examining the impact on hospitalization, reductions in inpatient admissions and bed days of care range from 20 percent to 75 percent. Litan also found studies reporting reductions in nursing home admissions of as much as 58 percent; in nursing home bed days of care, up to 68 percent.

More recently published research continues to offer positive evidence. In the December 2008  issue of Telemedicine and e-Health, Adam Darkins, M.D. and his colleagues reported the results of their study of 17,025 Veterans Health Administration (VHA) patients in Care Coordination/Home Telehealth (CCHT), the VHA’s national home telehealth program. Their data analysis shows substantial benefits: a 19 percent reduction in the number of hospital admissions and a 25 percent reduction in bed days of care. At $1,600 per patient annually, CCHT costs 87 percent less than VHA’s home-based primary care services. The lower cost for CCHT provides a strong economic rationale for including telehealth-supported care to appropriate patients as part of the standard complement of home care services.

Darkins and his colleagues concluded:

CCHT’s function within this patient population was akin to an “air traffic control system” that monitored patients with chronic care needs. CCHT enabled interventions to occur in this group of patients just in time – before they deteriorate; consequently, CCHT prevented hospital admissions and reduced hospital lengths of stay. CCHT replicates the potential for cost-savings and cost-avoidance at an enterprise level that previous pilots have shown elsewhere, and a reduction in staff travel to visit patients in their homes is a likely component of this.

Also of special note are findings from Remote Physiological Monitoring: Research Update, just issued by the New England Healthcare Institute (NEHI) in January 2009. This paper updates a report first published in 2004. NEHI compared the use of telehealth for remote monitoring of congestive heart failure patients to two existing heart failure management options: disease management (without remote monitoring) and standard care. They found that the hospital readmission rate for telehealth patients was 50 percent lower than the rate for patients in disease management (without remote monitoring) and almost 60 percent lower than the rate for patients receiving standard care.

NEHI applied the annual readmission rates to the cost of heart-failure related hospitalization. The differences in readmission rates yielded significant differences in annual per patient costs:

1. Remote Patient Monitoring with Telehealth: $5,632 annually
2. Disease Management Only: $11,387 annually
3. Standard Care: $13,448 annually

Given the annual comparative readmission rates and hospital costs, telehealth for remote patient monitoring yielded net savings (after accounting for the costs associated with the interventions) of about $3,700 per patient annually versus disease management and about $5,030 per patient annually versus standard care. These findings translate to estimated annual returns-on-investment (ROI) ranging from about 1.32:1 up to 2.45:1.

The Telehealth Payoff for Home Care
Most home care executives understand telehealth’s potential. What may be less clear is how they can attain the results that are demonstrated in research studies.

“One of the critical success factors for home care agencies is to apply telehealth-supported care to complement home visits for the highest-complexity, highest-risk segment of their patient populations,” said ATI’s Moore. “Given program logistics, telehealth is most practical for patients with longer versus shorter episodes, and it will yield the largest near-term improvements in clinical, health status and financial outcomes if it is used for those patients who are at highest risk for readmissions.”

American TeleCare (ATI) has developed a financial model which enables home care organizations to calculate the impact of telehealth on their costs and revenues. When ATI applies the model, an organization’s own numbers are used in all the calculations. However, application of the model with representative figures for the industry yields results that merit careful consideration. (See “The Impact of Telehealth: a Look at the Numbers,” below.)

(Also see "Two Agencies Report Telehealth Results," elsewhere in this week's issue. —Editor)

As illustrated in the model, home care agencies can, for example, increase the total number of patient encounters per episode by 20 percent while reducing per episode costs by 16 percent. In addition, deployment of telehealth can enable home care organizations to increase their monthly capacity and accept more referrals – without increasing the number of nurses, or their workloads. Increasing capacity translates to more revenue per month.

“To get the results demonstrated in the model, home care agencies have to re-engineer traditional care processes so that telehealth augments home visits,” Moore commented. “With the shortage of nurses, the financial squeeze of prospective payment and the prospect of payment penalties for readmissions, realizing the benefits of telehealth is an imperative for home care.”

References
Darkins, Adam, et al. “Care Coordination/Home Telehealth: The Systematic Implementation of Health Informatics, Home Telehealth, and Disease Management to Support the Care of Veteran Patients with Chronic Conditions.” Telemedicine and e-Health 14:10 (December 2008): 1118-1126. Print.

Deloitte Center for Health Solutions. “Connected Care: Technology-enabled Care at Home.” Deloitte LLP. March 2008.

Litan, Robert E. “Vital Signs via Broadband: Remote Health Monitoring Transmits Savings, Enhances Lives.” Better Health Care Together. 24 October 2008: 38-42. Print.

New England Healthcare Institute. “Remote Physiological Monitoring: Research Update. NEHI. 21 January 2009.