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  4. Telemedicine Improves Health and Saves Money, If Employees Use It
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Telemedicine Improves Health and Saves Money, If Employees Use It

As telehealth benefits availability grows, usage still lags

May 7, 2018 | Joanne Sammer

A doctor talking on the phone at his desk.


"Telemedicine" is often discussed as an important way to help manage and reduce health care costs. By providing access to a health care provider on the telephone or by an online video link, employers are hoping employees and their relatives will avoid more expensive alternatives such as hospital emergency rooms (ERs). So far, however, relatively few employees have shown a willingness to use telemedicine services.

Last fall, the National Business Group on Health's (NBGH's) Large Employers' 2018 Health Care Strategy and Plan Design Survey of 148 of the biggest U.S. employers reported that:

  • 96 percent of large employers are making telemedicine services available to their employees.
  • 56 percent of large employers plan to offer telemedicine that covers behavioral health services.
  • Only about 20 percent of these employers report that at least 8 percent of their employees are using telemedicine services.

When members of the Society for Human Resource Management, which includes small and midsize employers as well as large ones, were polled last year, 34 percent offered a telemedicine benefit.

Why Telemedicine?

There are several other reasons for offering telemedicine as part of a health plan, such as:

  • Convenience. "It's hard for employees to take time out of the day to take their child to a physician," said Kristin Parker, partner and total health management specialty practice leader with Mercer in Norwalk, Conn. "In areas where the provider network is limited, telemedicine can be a good supplement" to visiting a physician.
  • Cost. Telemedicine, if communicated appropriately, can provide so called "frequent fliers"—employees who tend to rely on the ER and urgent care more than others—with a much less expensive alternative for after-hours care.
  • Managing chronic illness. Employees or their relatives with chronic conditions may find it difficult to get to the doctor's office regularly. "Monitoring these patients' vital signs—weight, blood pressure, blood sugar levels, etc.—is also expensive in a doctor's office," said Martie Ross, a principal with PYA, a health care consulting firm based in Kansas City, Mo. "The technology to transmit this data from a patient's home to a doctor's office is more-robust than even five years ago," she said.

Overcoming Barriers

One of the key roadblocks to greater use of telemedicine is patient uneasiness about receiving medical care remotely from a provider with whom they have no previous relationship. Employer communication should address these issues head on by:

  • Emphasizing the credentials of the physicians in the telemedicine network.
  • Working with major health care providers in their networks to add telemedicine services to their practices, essentially creating a telemedicine option with providers known to employees.
  • When possible, altering plan design to eliminate copays for telemedicine, to make it more attractive to users.

Create a room at the worksite where employees can access telehealth services such as remote monitoring of chronic conditions, advises health care futurist and author Josh Luke.

Choosing the right vendor is also crucial. Ross suggested evaluating vendors based on patient satisfaction, the quality of the providers and the breadth of specialties available.

"It is also important to discuss how the vendor communicates back to the patient's primary care doctor following a telemedicine intervention," said Ross. "How do they close the loop? Telemedicine is designed to supplement, not replace, the primary care physician."

[SHRM members-only toolkit: Managing Health Care Costs]

A Telehealth Success

To confront the challenge of providing access to health care in rural communications, the Arlington, Va.-based National Rural Electric Cooperative Association (NRECA) decided to offer a telemedicine benefit, said Jodi Fuller, the NRECA's vice president for benefits product development.

NRECA administers health benefits for employees of more than 900 nonprofit electric cooperatives, which mostly operate in rural areas across the U.S. where a doctor or hospital may be two or three hours away, explained Fuller, who spoke in April at the NBGH's Business Health Agenda 2018 conference in Washington, D.C.

After a competitive bidding process in 2016, NRECA chose Teledoc as its service provider and launched a pilot program with about 5,000 voluntary enrollees to "work out the kinks."

"Most of our members' employees are out of the office working on power lines, but they do have smartphones," Fuller said. "In our population, there isn't a lot of video capability because smartphone broadband is limited, so we were leaning toward a vendor that didn't rely on video solutions," she noted.

A key goal was replacing urgent-care visits, but NRECA also considered the potential to expand the service by providing access to behavioral health counseling and chronic condition management.

Initial communications about the program were sent to employees' homes and included an offer, for those who signed up, of a free soup mug emblazoned with Teledoc's phone number.

"Our members can be 'old school' " and resistant to change, Fuller said. So the program has a significant incentive. It's offered at no charge to employees in NRECA's preferred provider organization plan, the message being, "Just try it, and we think you'll have a positive experience," Fuller said. For employees enrolled in the association's high-deductible plan, the charge is $45 per visit until the deductible is met, and then there is no charge.

Word of mouth in the pilot group was strong, Fuller said, as those who have had a positive experience tell their colleagues. While the industry average for telehealth usage is 2 percent to 3 percent of employees offered the service, she said, NRECA's participation rate for the 2017 pilot program was 15 percent.

For every dollar spent, the program saved $6 (based on employees surveyed at the end of every telemedicine visit, who said they would otherwise have gone to an urgent-care center or ER.)

This year, NRECA made the program available to all 56,000 of its members' employees and dependents. Through March, during a flu-heavy season, the program logged almost 28,000 visits.

Joanne Sammer is a New Jersey-based business and financial writer. Stephen Miller, CEBS, contributed to this article.


Related SHRM Articles:

Telehealth Continues Rapid Growth but Regulatory Barriers Persist, SHRM Online Benefits, December 2017

Telemedicine Missteps: Beware HSA Eligibility and Other Compliance Traps, SHRM Online Benefits, June 2017

Related SHRM Resource:

SHRM Vendor Directory: List of Telemedicine Companies


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