{"id":161,"date":"2020-11-13T14:56:39","date_gmt":"2020-11-13T14:56:39","guid":{"rendered":"https:\/\/wellai.health\/blog\/?p=161"},"modified":"2021-12-30T04:10:36","modified_gmt":"2021-12-30T04:10:36","slug":"telehealth-2-0-why-would-businesses-do-it-for-zero-savings","status":"publish","type":"post","link":"https:\/\/wellai.health\/blog\/telehealth-2-0-why-would-businesses-do-it-for-zero-savings\/","title":{"rendered":"Telehealth 2.0 \u2013 Why Would Businesses Do It for Zero Savings?"},"content":{"rendered":"

This is part 6 of the series on the WellAI\u2019s health cost savings calculator for CEOs, CFOs, heads of HR and heads of benefits.\u00a0 Today we will explain how cost savings from a product like WellAI’s data-driven Telehealth 2.0, are calculated, and why zero savings (unlikely, but hypothetically possible) may not necessarily mean you would want to stay with your old generation telehealth.<\/p>\n

In one of our previous blogs \u2018Telehealth 2.0<\/a>\u2019<\/span> we explained how WellAI envisions the future of telehealth.\u00a0 In fact, with WellAI\u2019s Telehealth 2.0, the future is getting closer.\u00a0 As we had described in that blog, WellAI’s Telehealth 2.0 is the next gen telehealth because the WellAI teledoctors are equipped with the most up-to-date AI health technology.\u00a0 The WellAI teledoctors are trained for efficiency and have instantaneous access to scientific information.\u00a0 By the time a patient gets to talk to a WellAI teledoctor, the doctor has patient\u2019s AI-based questionnaire, with questions and patient\u2019s answers, from the AI-based onboarding process, as well as patient\u2019s history via a compact visual tool called \u2018concept cloud\u2019.\u00a0 The process is quick, efficient, evidence-based.\u00a0 Do you think an ER doctor would want to comprehend patient\u2019s history in 2 seconds, as opposed to 2 minutes, using the concept cloud?<\/p>\n

Now let\u2019s discuss whether this next gen Telehealth 2.0 actually saves money for employers.\u00a0 I start with the literature review, and then use results from this review as inputs to the WellAI\u2019s Health Cost Savings Calculator for Employers to estimate the savings, if there are any.<\/p>\n

In a 2015 case study, Darkins et al conducted a retrospective analysis of the 2009\u20132012 Veterans Health Administration (VHA) data and\u00a0 assessed the efficacy of care coordination home telehealth (CCHT), a model of care designed to reduce institutional care.\u00a0 Outcomes for 4,999 CCHT\u2013non-institutional care (NIC) patients were compared with usual (non-CCHT) care in a matched cohort group (MCG) of 183,872 Veterans.\u00a0\u00a0 Subsequent analyses after 12 months of CCHT-NIC telehealth enrollment showed mean annual healthcare costs for CCHT-NIC telehealth patients fell 4%, from $21,071 to $20,206, whereas the corresponding costs for MCG (non-telehealth) patients increased 48%, from $20,937 to $31,055.\u00a0 On the other hand, higher mean annual pharmacy expenditure of 22% ($470 over baseline) for CCHT-NIC telehealth patients versus 15% for MCG (non-telehealth) patients ($326 over baseline) was attributable to the medication compliance effect of better care coordination. Several healthcare cost drivers (e.g., ER visits and admissions) had sizable declines in the CCHT-NIC telehealth group.\u00a0 Prefinal case selection criteria analysis of both cohorts yielded a 9.8% mortality rate in telehealth patients versus 16.58% in non-telehealth patients.<\/p>\n

A 2016 meta-analysis study by Kelly et al analyzed the effect of telehealth interventions in the long-term management of chronic diseases.\u00a0 A total of 25 studies were included, involving 7,384 participants.\u00a0 The authors concluded that telehealth-delivered dietary interventions targeting whole foods and\/or dietary patterns can improve diet quality, fruit and vegetable intake, and dietary sodium intake.\u00a0 The authors also suggested that when applicable, telehealth-delivered interventions should be incorporated into health care services for people with chronic conditions.<\/p>\n

In a 2018 meta-analysis study of 14 articles, Lee and Lee found that the use of telemedicine for retinal screening was beneficial and cost-effective for diabetes management.\u00a0 The study also reported that Among all telemedicine strategies examined, teleophthalmology was the most cost-effective intervention.<\/p>\n

A 2019 meta-analysis study of 14 studies was developed by Jiang et al.\u00a0 All 14 studies in the paper found the DHIs (digital health interventions), i.e. telemedicine, in the management of CVDs (cardiovascular diseases) to be cost-effective.<\/p>\n

In a 2020 meta-analysis study, Atmojo el reported that telemedicine utilization in dermatology, radiology, pediatrics, and intensive care unit (ICU) rooms reduced health costs by 56%.<\/p>\n

A 2020 study by the researchers at the University of California San Francisco found that more than 50% of all GP (General Practitioner) and ER (Emergency Room) visits were virtual.\u00a0 Before COVID, only 2-11% of all doctor\u2019s office visits were virtual.\u00a0 Some may take this 50% as a reasonable assumption for an employee telemedicine service usage.\u00a0 However, there is obviously an overlap in using various WellAI tools.\u00a0 For example, there is a high chance that an employee who utilizes the WellAI chronic diseases management program would also utilize the WellAI VideoMedix service.\u00a0 In addition, to be conservative, we are going to assume that those 30.8% who would use the WellAI digital health tools outside of telemedicine would benefit from WellAI so much, they wouldn\u2019t need the WellAI VideoMedix service.\u00a0 Hence, we are going to assume that only 19.2% (= 50% \u2013 30.8%) of employees would use telehealth.\u00a0 This is a very conservative assumption because even if all of those 30.8% employees who use the WellAI chronic disease management program and other tools are completely cured after finishing the program(s), they may still need to use the telemedicine service for the PCP visits and so on.\u00a0 However, we prefer underestimate than overpromise, as I had explained in one of my previous blogs \u2018WellAI\u2019s Health Cost Savings Calculator \u2013 It Is Critical to Use Conservative Assumptions!<\/a>\u2019.<\/span><\/p>\n

As mentioned above, to evaluate cost savings from the health cost savings from the WellAI telehealth (or telemedicine), it is important to ask a question \u201cCost savings compared to what alternative?\u201d\u00a0 If before the COVID-19 crisis one may have argued that the alternative to the WellAI telehealth service is the actual face-to-face doctor\u2019s visit, then now we\u2019d like to be realistic and conservative in our assumptions and take into consideration the fact that every major health insurance carrier now offers some form of a telehealth service.\u00a0 The telehealth service is heavily promoted to the employees of a company that is a customer of a major health insurance company.\u00a0 We are mainly talking about those employees who are on a PPO, HMO, or POS health plan type.\u00a0 For example, for a large employer, who may only offer one or all three of these health plans to its employees, the cost savings from the WellAI telehealth service is assumed to be zero, despite the fact that the WellAI telehealth may be cheaper, more efficient and is unique, as it is based on purely scientific data from over 30 million medical studies.<\/p>\n

Thus, the exact formula for the health cost savings from telehealth is<\/b><\/p>\n

(Estimated percent of employees who would use telehealth) x (Estimated cost reduction of telehealth vs face-to-face doctor\u2019s visit) x (Percent of employees who are not on PPO\/HMO\/POS plans)<\/b><\/p>\n

For example, for a typical (average) employer from a June 2020 mega-analysis study by Goetzel et al,\u00a0health cost savings from telehealth for an large employer are estimated at 0% to 1.6% of the total healthcare-related costs, and for a small employer those are estimated at 10.8%<\/a>.<\/span><\/em><\/p>\n

Where did 0% savings come from?\u00a0 Does it mean employers should\u00a0not<\/i>\u00a0be using the most recent advances in telehealth?\u00a0 First and foremost, 0% is the lower bound for savings from telehealth 2.0 and is a result of our very conservative assumptions, as we had explained above.\u00a0 We assume an employer doesn\u2019t save from telehealth 2.0 if every employee already has access to a telehealth service (for example, through a PPO\/HMO\/POS plan offered by their employer)\u00a0and<\/i>\u00a0refuses to try something new.\u00a0 In other words, the employer doesn\u2019t save if no one, not a single employee is willing to try the new generation of telehealth.\u00a0 Please keep in mind, we are not talking about switching from their current telehealth service to something like WellAI\u2019s Vidoemedix.\u00a0 We are just talking about trying it.\u00a0 After all, Videomedix is only one part of the WellAI\u2019s menu of offerings.\u00a0 However, it\u2019s an important part.\u00a0 It\u2019s super cheap, science based and of unlimited use to the whole family.<\/p>\n

Savings are important.\u00a0 But it\u2019s not just about financials.\u00a0 If you are an employer, you know how tough and challenging 2020 has been.\u00a0 You know what your employees and their families has gone through.\u00a0 Offering a cool new innovation to your employees could be a massive morale boost, a tool that gives your employees and their families a peace of mind.\u00a0 You can\u2019t always put a dollar number on that.<\/p>\n

\u00a0By the way, at WellAI, we believe the telehealth calls will very soon become high quality video calls, just like WellAI\u2019s VideoMedix.\u00a0 Hence, expect more and more talk about videohealth in the media.\u00a0 You heard it here first.\u00a0 Tell your friends.\u00a0 \ud83d\ude0a<\/p>\n

\u2026And No, telehealth is not going away after COVID\u2026<\/p>\n

All in all, depending on employees\u2019 demographics of a particular company, number of people with chronic diseases, participation rate, and the type of insurance plan, among many other factors,\u00a0the WellAI Health Cost Savings Calculator predicts 34% to 45% savings in an employer health costs<\/b>, on average.\u00a0 These savings are sourced from 5 factors:<\/p>\n