One Obvious and Three Unobvious Sources of ROI in TelemedicineBy: Scott Andrus
When it comes to calculating the return on investment for telehealth implementations, some sources of ROI are obvious, and some are not so obvious. Some are easy to calculate, and others are necessarily difficult. Some telehealth implementations deliver an immediate, transparent reduction in staff time and utilization, while other impacts may be indirect or further downstream, making them difficult to predict.
In my time talking to health systems about the ROI of a telehealth implementation, I’ve noticed there is at least one way in which the return is obvious and easy to calculate — but three which are not as obvious.
The Obvious: more efficient staffing, especially in patient sitting
By now, most health systems and physician groups understand that one of the core functions of a telemedicine solution is to deliver the ability to improve staffing efficiency and patient volume across multiple sites.
Nowhere is that ROI calculation more readily apparent and easy to calculate than when it comes to patient sitting. As my colleague Donna Gudmestad wrote in a post last year, virtual sitting both protects patients and keeps down costs:
Patient sitters traditionally provided in-room support to patients at risk of falling, injury, self-harm, or other behavioral issues. But, providing a physical sitter in each room can amount to a hefty unbudgeted expense for healthcare organizations.
Virtual patient sitting allows a health system to invest upfront in technology, and save in the long-run on that hefty unbudgeted expense of in-person patient sitters. The ROI calculation here is easy: telemedicine will offset X number of employees, paid $XX/hour, at X number of facilities.
But there are also other ways to think about the ROI of a telemedicine implementation.
1. Consolidation of vendors
If 2020 was the year telehealth saw widespread acceptance and adoption amid the pandemic, 2021 is the year when health systems are figuring out how to scale those ad hoc implementations into enterprise-wide solutions. To do so, they must often consolidate vendors.
Consolidation often provides its own return by reducing the investment in staff training and resources needed to learn multiple telemedicine platforms. Consolidating vendors may also reduce the inefficiencies which come from managing interoperability between multiple platforms.
On top of these benefits, consolidation of vendors will simply make the ROI easier to calculate.
2. Ability to scale
Speaking of consolidating vendors, the ability of a telemedicine platform to scale as you leverage it for more use cases provides its own form of ROI.
Take Zoom or FaceTime as examples. Many organizations turned to these tools in an emergency at the height of the pandemic. Both can get clinicians face to face with a patient, or connect a patient to their loved ones at home. But neither can scale much into other use cases.
Each time you run into the limits of what a particular point solution can provide, you must go through the process of soliciting proposals, identifying another platform, and then implementing and training staff on its use. Choosing one platform that will scale to other use cases as your organization is ready eliminates that investment in time and resources.
3. Pricing structure
Similar to above, your vendor’s pricing structure should be taken into consideration when accounting for a potential future expansion.
A peculiar aspect of the recent boom in telemedicine solutions is that few of them are competing on price. It turns out that qualities like ease-of-use, interoperability with the hospital’s EMR, and ability to scale have been more salient factors when it comes to deciding which vendor to use.
Still, the pricing structure matters when you begin to scale: will it require big new technology investments, or a steep increase in the unit cost? These are crucial considerations in the eventual ROI calculation.
4. Returns from a better Patient Experience
Finally, don’t forget that improving the overall patient experience will provide numerous returns, both direct and indirect. As we wrote last month, ensuring a seamless patient experience will help health systems hold on to the patients with whom they have already developed a relationship as well as potentially attract new ones.
Nearly 15 million people lost their employer-sponsored health insurance as a result of the economic upheaval caused during the pandemic — and as the economy recovers and these people find new jobs, new insurance plans, and new care providers, those systems which have properly integrated telemedicine into the entire patient journey will have an edge.
In a post-pandemic world, the last thing a health system can afford is losing patients to another organization because they’ve created a better care experience.
Learn more about how the Caregility platform can help your organization.