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Telemedicine Sustainability
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The Sustainability of Telemedicine Business Models in Rural America
BUSI511: Healthcare Administration Faizan Malik
December 1, 2023
Respectfully Submitted to: Professor Curry
Telemedicine Sustainability
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Abstract
Telemedicine has emerged as a pivotal tool in healthcare, especially highlighted during the
COVID-19 pandemic, where it played a crucial role in maintaining healthcare services. Despite
its potential to address healthcare disparities, particularly in rural America, telehealth remains
underutilized. This disparity raises questions about the relevance and adaptability of telehealth
business models beyond the pandemic. As we continue to navigate the post-pandemic landscape,
it is essential to evaluate whether these models can effectively meet the evolving needs of rural
healthcare and bridge the existing gaps in access and utilization. The future of telehealth in these
settings depends on its ability to adapt and remain a viable solution for healthcare challenges.
Key words: Telemedicine, Rural America, Healthcare Access Disparities, COVID-19, Healthcare
Business models
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Introduction
Telemedicine, defined as the employment of electronic information and communication technologies to deliver and facilitate healthcare services across geographical distances (Haleem et al., 2021), has been a critical component of modern healthcare and gained unprecedented prominence during the COVID-19 pandemic, demonstrating its ability to sustain healthcare delivery amidst global disruptions. It emerged as a vital resource, targeted for the underserved and those in rural areas, offering a glimmer of hope in bridging longstanding healthcare disparities. However, despite its potential, telehealth's utilization in these rural settings has been surprisingly limited. This raises pivotal questions about the ongoing relevance and sustainability of current telehealth business models in a post-pandemic world. To address concerns of sustainability, it's crucial to understand the multifaceted nature of telehealth, its challenges, and opportunities in rural America, and to contemplate its future trajectory in a rapidly evolving healthcare landscape through a comprehensive analysis of telehealth’s impact, its underutilization in rural areas, and the need for adaptable, resilient business models to ensure its continued efficacy and relevance in addressing rural healthcare needs.
History of Telemedicine
Understanding the dynamic of the telemedicine business within the context of sustainability in rural America begins with understanding how such healthcare delivery practices came into existence. Gogia (2020) delves into the practice of telemedicine over the years, tracing
its evolution from the 1970s with the development of satellite technology, through the 1980s and 1990s as personal computers, the internet, and disaster response integration enhanced its accessibility, to its expansion in the 2000s for in-home patient care, its application in developing countries in the 2010s, and its pivotal role during the COVID-19 pandemic in the 2020s (Gogia
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(2020). Arguably the biggest driver of widespread telemedicine utilization has been the advancements and increased accessibility to the associated technologies. These have included increased bandwidth and improved internet connectivity for high-quality telemedicine services, the development of new mobile health devices and wearable sensors for remote patient data collection, and the use of artificial intelligence and machine learning to analyze patient data for personalized care recommendations and enhanced care delivery efficiency (Waller & Stotler, 2018). As technology advanced and became more accessible, and adoption of telemedicine services began to increase, many benefits of telemedicine were presented to the healthcare community, for both providers and their patients. Providers saw benefits of increased access to patients, especially in rural or underserved areas, improved patient outcomes through remote monitoring and timely interventions, reduced healthcare costs due to a decreased need for in-
person visits, and enhanced job satisfaction and work-life balance, whereas patients received improved access to healthcare, particularly for those with mobility limitations or transportation difficulties, reduced travel time and costs, enhanced convenience and flexibility, and improved patient-provider communication and engagement (Hjelm, 2017). Hjelm (2017) also provides insights into the subsequent drawbacks of telemedicine utilization including the potential for reduced reimbursement rates for healthcare providers and a sense of technology dependence for patients, who may become overly reliant on telemedicine and neglect the importance of in-
person care for certain conditions (Hjelm, 2017). Arguably the most disconcerting aspect throughout the history of telemedicine is that, despite its development to aid those in rural areas with limited healthcare access, it remains significantly underutilized in these such when compared to its adoption in more urbanized areas
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Although there are numerous factors to the underutilization of telemedicine in rural areas, arguably one of the strongest is related to the technology required to support such healthcare delivery. Baker and Stanley (2018) outline the technical requirements for telemedicine delivery, which include a secure, high-speed internet connection essential for real-time video conferencing; a clinical telemedicine cart equipped with necessary devices and medical peripherals for patient-provider interaction; patient access software for secure and user-friendly access to appointments and records; and access to IT professionals for setup, maintenance, and troubleshooting of the telemedicine system (Baker & Stanley, 2018). These, however, are the most basic of requirements, with Baker & Stanley (2018) also recommending that telemedicine programs incorporate robust security measures for HIPAA compliance, assess network bandwidth to prevent bottlenecks, establish redundancy and backup systems for continuity, and conduct regular maintenance and updates to keep pace with evolving technologies (Baker & Stanley, 2018). From the patient’s perspective, technology requirements often include reliable broadband for consistent telemedicine, low-bandwidth tools for limited internet access, device distribution, and training programs, multilingual services for diverse linguistic needs, and telemedicine-equipped community centers for those without personal technology access. (Baker & Stanley, 2018). In the context of technical requirements, one variable that is often unaccounted
for is the end-user experience, resulting in systems that are not tailored to the needs and expectations of the user, both the healthcare provider and their patients. This end-user experience
is often the key driver in successful telemedicine implementation, with a study performed by Klaassen et al. (2016) emphasizing that understanding and applying various usability methods is essential for meeting the diverse needs of different end-user groups and applications in telemedicine, such as those in more rural settings (Klaassen et al., 2016). These variabilities in
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end-user needs often result in telemedicine technology lacking critical functionalities for those in
rural areas, such as offline mode or the telemedicine delivery system that does not require real-
time internet connectivity (Chandwani & Dwivedi, 2016). Offline mode functionality removes the need for broadband internet access to utilize telemedicine, an issue often faced in more rural areas.
Technical Requirements and Current Offerings
The advancements in telemedicine technology discussed earlier have provided both healthcare providers and their patients with multiple avenues for telemedicine delivery. Many are
familiar with the more traditional offerings of telemedicine which leverages technology like video conferencing, digital data exchange, and remote monitoring tools to facilitate patient care, consultation, and medical procedures remotely. While many are familiar with traditional telemedicine offerings, which use technology such as video conferencing, digital data exchange, and remote monitoring tools for patient care and consultations (Gogia, 2020), the scope of telemedicine extends further to include safety and security monitoring through devices like gas sensors and flood and fire detectors, health parameters and vital signs monitoring, including heart rate, blood pressure, body temperature, and glucose levels, as well as support through information and communication technology, encompassing teleconsultations, SMS reminders for
appointments and medications, and educational text messages (Magdalena, 2015). The COVID-
19 pandemic brought an increase in telemedicine utilization, both in urban in rural areas, but significantly more so in urban areas of the United States. A study performed by Chu et al. (2021) found that although usage significantly increased in both urban and rural settings, it increased significantly more in urban areas (220 visits per 1000 urban patients) when compared to rural areas (147 visits per 1000 rural patients) (Chu et al., 2021). Despite the variety of offerings
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available to patients, there continues to be an underutilization of telemedicine in rural areas of the United States, ultimately impacting the perspective of telemedicine for both healthcare providers and their patients.
Healthcare Provider and Patient Perspectives
While multiple factors impact healthcare provider's perspective on the implementation of telemedicine programs within healthcare facilities' service offerings, a significant consideration is the associated costs and reimbursements; this includes upfront expenses such as purchasing equipment and software, staff training as outlined by Hjelm (2017), and also ongoing expenses for system maintenance and support, all of which play a vital role in determining the viability and sustainability of telemedicine programs (Hjelm, 2017). In addition to the high initial costs, the financial viability of telemedicine is often impacted by barriers, such as technical challenges, legal uncertainties, limited funding, reimbursement complexities, and a lack of comprehensive evidence for its value and efficiency, hindering its broad adoption and effectiveness (Atiyeh & Janom, 2014). Healthcare facilities are willing to incur such substantial costs, and potential financial loss, associated with telemedicine implementation simply for the benefits it provides the communities they serve, specifically improved patient outcomes. While the full impact of telemedicine on patient outcomes remains to be fully elucidated, existing studies indicate its effectiveness in treating various conditions, including chronic diseases and mental health issues, suggesting that it holds promise as a valuable tool for enhancing healthcare access and outcomes,
particularly for rural patients (Chu et al., 2021). In addition to improving health and well-being, patients have reported high levels of satisfaction with telemedicine, specifically during the Covid-19 pandemic as reported by Pogorzelska and Chlabicz (2002), who implicate its undeniable convenience and potential in ensuring the continuity of medical care, noting that
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telehealth can often adequately replace face-to-face consultations, with regular patient feedback being crucial for its future enhancement (Pogorzelska & Chlabicz, 2022).
Telemedicine Business Models
Just as patient outcomes are often a driver of telemedicine implementation success, the business models are often the driver of telemedicine sustainability. Depending on the services offered and the target market, healthcare facilities will implement varying telemedicine business models. However, all telemedicine business models can generally be categorized under three main categories: Direct-to-consumer or D2C, Clinician-to-clinician or C2C, Organization-to-
Organization or O2O (Acheampong & Vimarlund, 2015). In the D2C, patients directly pay for telemedicine services, often through subscription or per-visit fees, provided by independent companies not affiliated with healthcare providers, while in the C2C model, services are rendered by clinicians to their peers for consultations, second opinions, or clinical collaboration, and in the O2O model, telemedicine services are offered to entities like hospitals or employers on a subscription or per-visit basis (Acheampong & Vimarlund, 2015). Chen et al. (2013) argue that telemedicine business models share common values of increasing healthcare access for patients who may otherwise access traditional in-person services, being patient-centered to meet the patient's needs and preferences, being cost-effective while maintaining quality of care and patient safety, and must be sustainable (Chen et al., 2013). Despite the shared common values, each of the varying telemedicine business models has unique requirements in the context of sustainability. For sustainability, D2C telemedicine services need to generate substantial consumer demand, C2C services must seamlessly integrate into existing clinical workflows, and O2O services should offer a compelling value proposition to both purchasing and providing entities (Chen et al., 2013). However, telemedicine business models present their unique
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challenges as well, regardless of the type of services offered. Antoniotti (2021) highlights reimbursement uncertainties, the costly and time-intensive adoption of technology, regulatory requirements, and patient hesitation as the main challenges to any telemedicine business model (Antoniotti, 2021). Such challenges compound existing in telemedicine utilization in rural areas and act as a contributing factor to the concern of sustainability for all telemedicine business models.
Telemedicine Challenges in Rural Areas
Rural areas in the United States have long been plagued with healthcare access disparities,
with telemedicine being introduced as a potential solution to such issues. However, despite advancements in technology and widespread utilization of telemedicine, those in rural areas utilize telemedicine healthcare delivery when compared to similar demographics in more urban areas. Marcin et al. (2016) highlight the subsequent impact of healthcare access disparities in rural areas, noting that individuals in these areas face significant challenges in receiving timely and adequate healthcare, which has serious implications for the health outcomes of the population (Marcin et al., 2016). As a result, individuals in rural areas of the United States are faced with worse healthcare outcomes due to lower life expectancy, limited healthcare access, and higher rates of chronic diseases and issues with access to healthcare treatment due to fewer ICU beds and higher hospital closure risks, with the COVID-19 pandemic exacerbating these vulnerabilities with limited testing and heightened risk of complications (Hirko, et al, 2020).
To address challenges related to telemedicine business model sustainability in rural areas, a deeper understanding of the issues faced by healthcare providers and their patients in such areas is needed. Although the larger issues of healthcare access disparities in rural areas are complex and multifaceted, the underutilization of telemedicine in these areas is often attributed
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to two main causes: reimbursements for healthcare providers and technology limitations. In addition to the high initial costs associated with telemedicine implementation discussed earlier, healthcare facilities and their providers are often met with issues of unequal insurance coverage amongst patients and lower reimbursement for telemedicine care (Zachrison et al., 2020). Zachrison et al. (2020) highlight that in rural regions, patients frequently have insurance plans that restrict or exclude certain telemedicine services, and when covered, these services often receive lower reimbursement rates compared to traditional in-person consultations, thus posing financial challenges for providers in already economically strained rural areas (Zachrison et al., 2020). The Covid-19 pandemic saw the easing of several laws and regulations governing telemedicine utilization, as a means to increase reimbursement and utilization, including temporary measures such as allowing Federally Qualified Health Centers (FQHCs) and Rural Health Clinics (RHCs) to serve as distant site providers for behavioral/mental health services and
other permanent changes including allowing Medicare patients to receive telehealth services for behavioral/mental health care in their home (Telehealth policy changes after the COVID-19 public health emergency, 2023). In addition to the technical requirements in terms of hardware needed to support telemedicine utilization, one of the most challenging aspects of increasing telemedicine utilization in rural areas is the lack of access to broadband internet in such areas.
According to a recent Federal Communications Commission report, 22.3% of rural Americans and 27.7% of Americans living on Tribal lands do not have access to fixed terrestrial broadband at speeds of 25/3 Megabits per second (Mbps), in contrast to just 1.5% of urban Americans facing the same issue (Broadband, n.d.). With telemedicine delivery having a recommended minimum broadband internet speed of 15-25 Mbps, those in rural communities lack the infrastructure needed to support the most basic of services.
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Methods to Increase Telemedicine Utilization in Rural Areas
With many in rural areas lacking the basic technical infrastructure to support basic telemedicine delivery, increasing utilization begins with correcting issues related to the lack of broadband internet access. The COVID-19 pandemic and the subsequent uptick in telemedicine utilization brought about several federal initiatives to address aspects of the digital divide. This includes a comprehensive funding strategy with $65 billion from the Infrastructure Investment and Jobs Act for addressing the digital divide, $20.4 billion from the American Rescue Plan for digital equity policies, and $1.6 billion from the Consolidated Appropriations Act for enhancing connectivity in minority and tribal communities and general broadband infrastructure (Valentín-
Sívico, et al., 2023). With the funds being administered by different federal agencies, such as the FCC and the National Telecommunications and Information Administration (NTIA), as well as by the states and U.S. territories, this will serve as the foundation for addressing technical and healthcare-related disparities in rural areas of the United States, which is critical to the sustainability of telemedicine programs.
After addressing existing issues with technical infrastructure and broadband internet access, many of the remaining improvements for telemedicine utilization are related to the healthcare facilities and providers. Beginning with the reimbursement models for telemedicine services should be reviewed to ensure equitable access to quality care, regardless of location or socioeconomic status. A study performed by Neufield et al. (2016) successfully demonstrated that one of the key drivers of increased telemedicine adoption has been reimbursement rates for healthcare providers, as these directly impact their financial viability and willingness to offer telemedicine services (Neufield et al., 2016). The study found that following state Medicaid and commercial payer policy changes to increase reimbursement rates, utilization increased by 118%
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in 2013 in Michigan following the adoption of telemedicine parity for commercial payers, whereas states without significant policy changes exhibited no obvious telemedicine utilization increase (Neufield et al., 2016). If the issues with reimbursing healthcare providers for offering telemedicine services are addressed, more healthcare facilities will be keen to implement such programs. However, healthcare facilities must also look to address issues with how telemedicine programs are offered to their patients. With patient concerns over the quality of care they receive from telemedicine visits, Kreofsky et al. (2018) recommend healthcare facilities standardize telemedicine protocols and documentation to integrate telemedicine workflows into existing healthcare processes, thereby streamlining practices through uniform protocols and documentation procedures for stakeholders and ensuring a seamless transition for patients, who are essential to the success of telemedicine programs (Kreofsky et al., 2018). Doing so allows healthcare facilities and providers to establish a consistent and reliable experience for patients, boosting their confidence and satisfaction with telemedicine.
Providing a positive experience for patients often begins with ensuring healthcare providers have the proper training, both in terms of medical expertise and technical know-how to
effectively offer telemedicine services. A study performed by Ayatollahi et al. (2015) found that most clinicians had limited knowledge about telemedicine technology, with an average rating of low to very low, yet they perceived its advantages at a moderate level and overwhelmingly agreed that system characteristics like ease of use significantly influence telemedicine adoption (Ayatollahi et al., 2015). By offering healthcare providers targeted educational materials and proper training, healthcare facilities can enhance telemedicine services offered to their patients and the overall training experience. Hippe et al. (2020) recommend simulation-based education (SBE) for healthcare providers, where various simulation technologies are utilized to recreate
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real-world scenarios (Hippe et al., 2020). Adding SBE to existing training materials has proven to improve patient safety through error reduction, enhanced skill acquisition with repeated realistic practice, increased knowledge retention due to its engaging nature, reduced training costs, and standardized training to ensure uniform competence among healthcare professionals (Hippe et al., 2020). Successful implementation of SBE training materials can allow for a seamless transition into real-world patient care, clearing a hurdle for more widespread telemedicine utilization in rural areas.
While various facets of implementation, adoption, and utilization can be improved, the business models of current telemedicine programs should also be addressed to maximize value to
both the healthcare providers and their patients. Although several federal initiatives have been enacted that may potentially improve factors such as reimbursements, it is unlikely that these measures alone will fully resolve the complexities and challenges facing the healthcare system, particularly in the context of telemedicine and rural healthcare. To ensure the sustainability of current telemedicine programs, Acheampong and Vimarlund (2015) recommend several alternative business models including subscription-based models that cater to varying needs and budgets, which can provide more flexible and tailored telemedicine services and align with the evolving dynamics of healthcare delivery (Acheampong & Vimarlund, 2015). Changing business
models may address the financial sustainability of telemedicine programs, but healthcare providers can also look to partner with Internet Service Providers (ISPs) or other similar entities to ensure their patients can receive high-quality care. The Rural Health Care Program provides funding for telecommunications and broadband services necessary for healthcare provision, covering eligible providers such as post-secondary educational institutions offering healthcare instruction, teaching hospitals, medical schools, and community health centers to improve the
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standard of healthcare accessible to patients residing in rural communities (Rural Health Care Program, n.d.). Incorporating such programs and partnerships can ensure the sustainability of telemedicine programs by addressing the core financial and technical issues.
Future Areas of Research
This research provides suggestions to address issues related to telemedicine and barriers to widespread utilization in rural areas, such as the digital divide and healthcare access disparities. Future research should address how telemedicine can be utilized in other disparities that exist in American society, including those related to race and ethnicity. A study performed by
James et al. (2017) found that non-Hispanic blacks and Hispanics were less likely to have healthcare coverage compared to non-Hispanic whites, and a higher percentage of non-Hispanic blacks, Hispanics, and AI/ANs reported cost-related barriers in accessing physician services compared to their non-Hispanic white counterparts (James et al., 2017). With telemedicine being an effective tool for patients to manage their own care, such programs may potentially be utilized
to spread healthcare access to disenfranchised communities.
Conclusion
Telemedicine, while a transformative force in healthcare, particularly highlighted during the COVID-19 pandemic, has not yet reached its full potential in rural areas. This underutilization stems from a complex interplay of technical, financial, and socio-cultural factors, necessitating a comprehensive approach for ensuring longevity and effectiveness in these
communities. One of the most pressing barriers is the lack of reliable high-speed internet access, which is crucial for the delivery of telemedicine services. This technological gap, which hinders real-time consultations and effective data exchange, needs urgent addressing. Federal initiatives
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like those in the Infrastructure Investment and Jobs Act and the American Rescue Plan are promising starts towards bridging this digital divide. However, their implementation needs to be expedited and specifically tailored to the unique needs of rural communities to make telemedicine a feasible option for all. The economic aspect of telemedicine, particularly concerning reimbursement policies, is another critical factor in its sustainability. Current reimbursement structures often fail to align with the costs of providing telemedicine services, creating financial disincentives for providers. This misalignment poses a significant challenge for
the economic viability of telemedicine in rural settings, where healthcare providers already face economic strains. Addressing this requires not just policy reforms but also innovative financial models that support both providers and patients. Furthermore, the socio-cultural dimensions of telemedicine cannot be overlooked. There's a pressing need to develop telemedicine systems that are user-friendly, culturally sensitive, and accessible to diverse populations, including those with limited technological literacy. This involves not only technological advancements, but also educational initiatives aimed at both providers and patients, enhancing their comfort and proficiency with telemedicine. To ensure the effective and sustainable integration of telemedicine
in rural healthcare, it is imperative to explore alternative business models and partnerships. These
could include subscription-based models catering to different needs and budgets, and collaborations with Internet Service Providers (ISPs) to improve technological infrastructure. Such efforts, combined with a focus on continuous training and education for healthcare providers, can significantly enhance the quality and accessibility of telemedicine services. While telemedicine holds immense potential for transforming healthcare in rural America, realizing this
potential requires a multi-faceted strategy that addresses technical, financial, and socio-cultural challenges. By adopting a holistic approach that encompasses infrastructure development, policy
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reform, financial innovation, and community engagement, telemedicine can become a sustainable, effective, and inclusive solution for bridging healthcare disparities in rural America.
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