It’s called telemedicine. Say you have symptoms of a sinus infection or the flu, or even need a trip to the emergency room. Rather than wait days for a diagnosis from your primary doc, a telemedicine service can get a bona fide physician on the phone, by email, or on a video screen via Skype in 60 minutes or less—24 hours a day, seven days a week.
“Our health care system is broken in many ways, but telemedicine is a game-changer,” says Daniel McGugin, partner at Virtus Benefits, an employee benefits provider in Nashville, Tenn.
Good Medicine For Small Business
McGugin shared one case study involving a 150-person trucking company he’ll call “Abecee Transportation.” (Virtus won’t release real client names.) This month Abecee faced a 17% increase in its health insurance premiums. To ease the pain, the company considered switching to a plan with a higher deductible. That would have saved $150,000 a year in premiums; it also would have aggravated Abecee’s employees who would be forced to pay a bigger portion of their medical bills from their own pockets.
Enter telemedicine. In 2012 Abecee paid $120,000 in claims for “non-emergent” doctor visits (the sniffles and such), including expensive trips to the ER. According to a recent study by AmeriDoc—a leading telemedicine provider, along with Teledoc and Consult A Doctor—17,000 patients with access to a telemedicine plan reduced their number of visits to doctors’ offices by 30%, and to hospitals by 60%. At those same proportions, Abecee would save roughly $65,000 in claims. Cost of AmeriDoc’s telemedicine plan: $24,000.
As for Abecee’s employees, they’d get to keep their health benefits while not wasting productive hours schlepping to a doctor’s office or an ER. A 2010 report by Press Garney, a health care consultancy in South Bend, In., found that the average ER wait time is a little over 4 hours. AmeriDoc guarantees that doctors in its network respond within an hour.
“Health premiums are only going higher and employers will continue to shift the burden to employees through high-deductible plans,” says McGugin. “We’re telling all of our clients to take a hard look at telemedicine.”
To be clear, telemedicine is no substitute for traditional insurance. Nor is it particularly cheap for individuals buying it in the open market. Individual telemedicine plans cost roughly $120 a year (including dependents), plus a $30 “consult fee” per call. (Employer-sponsored plans generally don’t charge a consult fee.)
If you’re a healthy male, have no preexisting medical conditions and are willing to take chances, you might want to pair telemedicine service with a super-high-deductible insurance plan that has a rock-bottom premium. That combo provides access to affordable treatment for non-emergencies while cushioning the financial blow of a catastrophic illness or accident. Other target customers include those who simply can’t afford traditional insurance but want access to basic care.
You can sign up for telemedicine service by calling a provider directly or working through a broker like McGugin. The cost is the same—providers pay the broker fee, not you.
Point Of No Return
While telemedicine isn’t new (hospitals have used phones to serve remote rural areas for 40 years), less than 1% of Americans have access to it. Expect more to join the ranks—and soon—thanks to affordable high-speed Internet connectivity and, of course, rocketing health costs.
The Society of Actuaries just released a study estimating that premiums on individual health plans will jump 32% over the next three years. Towers Watson, an HR consulting firm, found that 70% of companies with more than 1,000 employees will offer high-deductible plans ($1,250 minimum deductible) this year, up from 59% in 2011. And Rand Corp. estimates that, within a decade, half of all workers with employer-sponsored health care (including government employees) will have high-deductible plans.
All that bad news is good for David Lindsey, CEO of AmeriDoc. Founded just five years ago, the Dallas company has quietly amassed 1.3 million paying patients (not including dependents). That number is on track to triple by the end of the year, says Lindsey.
AmeriDoc’s network includes 290 doctors (some licensed in multiple states) who agree to be on call when they aren’t seeing patients on-site. Lindsey claims he has enough capacity to handle current members, though he looks to add more white coats all the time. “Doctors inquire every day about joining the network,” he says. A big reason: more patients per hour with little additional overhead. “They hate dealing with insurance companies. [Telemedicine] is how they’re going to get paid in the future.”
To control quality (and avoid malpractice suits), AmeriDoc records all visits electronically and stores the data for seven years. Customer-service staffers review random samples of calls every week; they also call every patient within two days after a consultation. “We call three times,” says Lindsey. “If [the member] doesn’t respond, we assume all went well. We’ve never had a malpractice claim.”
Lindsey concedes that, thus far, a lot of subscribers use telemedicine to “shop for prescriptions” without having to visit a doctor. Viagra is a big request—one that AmeriDoc’s physicians routinely deny without the requisite heart-rate and blood-pressure tests.
Meanwhile, AmeriDoc’s remote-delivery menu of services is expanding. The company created a finger-prick blood-testing pack that lets patients take their own samples and mail them in sterilized packs to a lab to measure testosterone, cholesterol and glucose levels. Next month AmeriDoc will roll out another self-blood test that aims to detect future cardiovascular disease.
Bottom line on telemedicine, says Lindsey: “It would be irrational if you did not call it a ray of hope for American health care.”
Have thoughts on telemedicine? Please comment on this post. Have any other smart ideas for taming health care costs? Share those, too.
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