Friday, February 12, 2016

The Payment Reform Landscape: How Does Telehealth Fit Into A High-Value Purchasing Strategy?

Blog_Delbanco payment reform

Employers and other health care purchasers will continue to seek new ways to procure high-value care for their member populations as long as the cost of health care continues to rise and quality remains uneven. Over the last five years, there have been significant reforms to how we pay providers for services, along with attempts to improve transparency in the health care system to give consumers and purchasers needed insight into the quality and price of care.

In addition, there is an ongoing seismic shift in how employers and health plans structure health benefits for consumers, placing more financial responsibility on consumers for how they utilize health care services. This is all happening in the context of a rapidly changing health care provider landscape marked by unprecedented consolidation and the market power and higher prices that come with it.

Another movement afoot, which intersects with these developments, is the continued expansion of telehealth into the health care system. In the market today, there are many different definitions and uses of telehealth. Most involves just the use of a telephone; however, telehealth is evolving with technology and is also accessible through personal and worksite computers; the use of apps on smart phones and tablets, some of which include video; and, through dedicated kiosks, complete with connected biometric devices.

Increasingly we will see telehealth integrating with mobile health and home medical devices (picture an otoscope connected to your smartphone). Current clinical uses for telehealth include:

  • provider to provider consultations on acute stroke, radiology and imaging, and cardiology;
  • provider to patient communication for primary care, chronic disease management, behavioral health, and dermatology; and,
  • communication between family caregivers and providers as we try to move more patient care into the home care setting.

The delivery of health care through telecommunications is not new, but current concerns about access to primary care, access to certain specialists, appropriate utilization, and the need to infuse more value into health care offerings have led many purchasers to implement or consider telehealth.

According to a 2015 National Business Group on Health survey, 74 percent of large employers expect to offer telehealth services to their employees in 2016, likely either through a partnership with an independent vendor or through contracted health plans. While some of the benefits of the telehealth movement are obvious, such as introducing lower cost care options into the market, how it spins out may have bigger ramifications for the health care system pertaining to high-value purchasing strategies, market power, payment reform, and benefit design.

Advantages Of Telehealth

For employers and other purchasers, the direct advantages of telehealth include:

  • improved access to care, particularly for employees in rural areas where there are fewer providers;
  • increased employee presenteeism and productivity, as employees miss less work for appointments; and,
  • a reduction in inappropriate utilization of health care services, such as visiting the emergency room due to a lack of access to primary care.

Telehealth could also support other high-value purchasing strategies employers may be using. For instance, as explored in our paper, "A Guide for Purchasers: How Telehealth Fits into a High-Value Purchasing Strategy," telehealth could bolster a Center of Excellence (COE) strategy. COEs may be geographically distant from employees, making travel necessary for in-person visits, which may deter some employees from utilizing them. However, telehealth for pre-procedure consultations and follow-up care could encourage use of the COE by reducing the need to travel for care.

Provider Services

This example brings to mind a potential indirect advantage for purchasers — telehealth may enhance competition among health care providers, at least for the foreseeable future. Telehealth is not nearly as confined to geographic boundaries or physical locations as traditional in-person care. Providers accustomed to controlling geographic areas of a market may see an encroachment on their territory from outside providers giving patients care through telehealth.

In a market where a dominant provider system monopolizes the provision of services and inflates prices accordingly, telehealth from independent providers could not only be a source of lower cost care, but also help triage patients to appropriate care settings, reducing unnecessary use of an overpriced health care system. Greater competition from providers external to the market can also push local providers to rethink both their pricing and payment arrangements, as well as the patient experience.

While telehealth services for patients are largely offered by independent providers today, there are many reasons to believe that patients' regular providers will also offer them in the future.

First, many provider payment reforms create incentives for providers to minimize unnecessary utilization of higher cost services. Going back to the example of the Center of Excellence, if the COE is paid under a bundled payment arrangement, COE providers may find telehealth helps them stay within their budget for the provision of services. Second, as new benefit designs encourage patients to seek lower cost, appropriate care, providers will want to find a way to meet those needs, rather than lose patients to more convenient and less costly services elsewhere.

Lastly, telehealth poses challenges to coordinating patient care if patients seek telehealth services from providers who do not have easy channels of communication back to their regular providers.

Challenges To Telehealth Expansion

Furthermore, there are current limitations on telehealth's expansion. These stem in part from laws and regulations related to standards of care that restrict the use of telecommunications to provide health care services. In addition, payment to providers for telehealth services is not yet fully evolved. Current advocacy efforts center on ensuring parity in payment for telehealth services.

While this is a sound tactic for encouraging telehealth offerings today, we may rue this approach one day as the lower cost structure of telehealth should mean lower prices than in-person care. It is also worth thinking about how to pay telehealth providers, not just how much. Today, we pay for most independent telehealth on a fee-for-service basis, but we will soon likely find ourselves wishing to apply the same incentives we are inserting into payments to providers for in-person care.

Employers and other health care purchasers looking for new ways to generate value may find that telehealth fits neatly into their high-value purchasing strategy in more ways than one. While most purchasers utilize telehealth to extend access to primary care services and reduce emergency room visits, telehealth can address a broader array of health care needs and potentially impact the dynamics of a health care market in positive ways, as long as we keep an eye to ensuring it enhances, and does not impinge on, the quality of patient care.

Purchasers should track telehealth's evolution closely and look for further opportunities to integrate it into their broader, high-value health care strategies.



from Health Affairs Blog http://ift.tt/1KfKpXC

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