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Research & Commentary: Telehealth Empowers Peach State Consumers and Reduces Costs

March 15, 2019

In this Research & Commentary, Matthew Glans examines two bills advancing through the Georgia legislature that would expand the scope of telehealth services by allowing providers in other states to deliver virtual care and creating payment parity.

Telemedicine—the use of information technology to remotely diagnose, treat, or monitor patients —can transform health care delivery by making it more affordable and available. The main barriers preventing telemedicine from expanding further in many states are government regulation and the inability of the current system to properly reimburse doctors providing telemedicine services. Strict licensing standards have become a significant barrier to entry in the health care industry. In many instances, states control licensing standards, professional discipline, and the various costs associated with the licenses.

In Georgia, two new bills are advancing quickly through the legislature that would expand the scope of telehealth services by allowing providers in other states to deliver virtual care in Georgia while creating payment parity by mandating that payers cover telehealth services at the same rate as in-person services. First proposed by State Sen. Renee Unterman (R-Buford), these bills answer the many uncertainties telemedicine providers face and open the state to a substantial expansion of telehealth, which will help bring convenient and affordable care to areas where it is currently lacking.

The first bill, Senate Bill 115, allows healthcare providers in other states to treat Georgia residents as long as those providers meet all applicable state telemedicine and telehealth laws. The bill also limits those providers to telemedicine and does not allow them to provide in-person care. While some critics are concerned doctors from states with lower licensing standards would provide lower quality care, competition will quickly weed out bad actors and most patients receive quality care. A study from the American Journal of Managed Care found telemedicine patients score lower for depression, anxiety, and stress, and have 38 percent fewer hospital admissions. A 2018 study from the Agency for Healthcare Research and Quality also that found telemedicine is clinically effective. 

The second bill, Senate Bill 118, clarifies how the state defines telemedicine and telehealth and sets new guidelines for how telemedicine and telehealth providers are paid. SB 118 establishes telemedicine and telehealth as occurring in the state where the patient is located for licensing purposes. It also defines remote monitoring as telemedicine and telehealth and widens the scope of telehealth technologies to a wide array of communications mediums; ensuring future developments will be included. The bill also addresses the important issue of payment parity, SB 118 requires payer to cover telemedicine and telehealth services “on the same basis and at least at the rate that the insurer is responsible for coverage for the provision of the same service through in-person consultation or contact.” It also bans ban annual or lifetime caps on reimbursement and any insurer from requiring telemedicine over in-person care.

Both bills passed unanimously out of the Georgia Senate in February.

Currently, 200 telemedicine networks with 3,500 service sites are in operation across the United States, according to the American Telemedicine Association, and the number of telemedicine and telehealth providers is only expected to grow. A 2017 report on the global telemedicine market estimates the telehealth market is poised to expand at a compound annual growth rate of about 16.3 percent over the next decade, reaching approximately $78.3 billion by 2025, according to Accuray Research LLP.

Furthermore, telemedicine is popular with patients. For example, among telehealth patients receiving services on a mobile app, 80 percent preferred telehealth compared to a traditional in-office encounter, a 2016 study by West Monroe Partners reveals.

Telemedicine and telehealth have the potential to provide routine health care services to more people and at a lower cost than traditional in-person delivery. Unfortunately, unnecessary and burdensome government regulations continue to stifle access to telemedicine services. Unterman’s telemedicine reform efforts would help make telemedicine more widely available to Georgia. Additional states should pass similar legislation, thereby increasing health care access and simultaneously reducing costs.

The following documents examine telemedicine and various barriers blocking its expansion.

 

AHRQ Finds Telemedicine Clinically Effective
https://www.politico.com/newsletters/morning-ehealth/2018/06/01/ahrq-finds-telemedicine-clinically-effective-238848
Politico’s Mohana Ravindranath examines a new study from the Agency for Healthcare Research and Quality that found telemedicine is clinically effective. The study was unable to find conclusive evidence to determine if telemedicine is more cost-effective, however.

The Promise of Telehealth For Hospitals, Health Systems, and Their Communities
https://www.aha.org/system/files/research/reports/tw/15jan-tw-telehealth.pdf
This study from the American Hospital Association examines the potential benefits of telehealth. The study’s researchers focus on how telehealth is being used by hospitals and considers how this important innovation helps patients and providers alike.

Telemedicine Facts that May Surprise You
https://chironhealth.com/blog/telemedicine-facts-may-surprise/
In this article published by ChironHealth.com, Lauren Cranford examines several research studies and polls that prove telemedicine is popular and effective.

Telemedicine … Across State Borders
https://www.cato.org/publications/commentary/telemedicine-across-state-borders
Shirley Svorny, professor of economics at California State University at Northridge, discusses the value of using telemedicine services, how allowing telehealth care across state lines would improve the availability of care, the barriers to telehealth expansion, and some reforms state and federal legislators should consider that would expand telemedicine services.

The Traveling Doctor: Medical Licensure across State Lines
https://www.americanactionforum.org/insight/the-traveling-doctor-medical-licensure-across-state-lines/
Brittany La Couture of American Action Forum examines the licensing process for doctors in several states and argues for reform. “Though it is important to recognize the right of states to protect the health, safety, and welfare of their citizens, mutual recognition and portability would still largely give states the ability to continue to monitor the care that is provided by physicians licensed in their state while creating incentives for states to build competitive regulatory systems that will attract physicians to those states,” wrote La Couture.

Telemedicine: Changing the Landscape of Rural Physician Practice
http://www.nejmcareercenter.org/article/telemedicine-changing-the-landscape-of-rural-physician-practice/
Writing in the New England Journal of Medicine, Bonnie Darves argues new applications of telemedicine have enabled rural physicians to manage a wide range of acutely ill patients, improve accessibility to specialists, and reduce barriers to care in underserved regions: “With advances in technology, plummeting costs, and governmental health care system partnerships, telemedicine is now used by more than half of U.S. hospitals and has reduced rural practice isolation. Be sure that health plan and hospital credentialing, privileging, licensure, and malpractice issues are addressed before practicing telemedicine.”

Physician Care and Telemedicine
http://heartland.org/policy-documents/physician-care-and-telemedicine
Devon Herrick of National Center for Policy Analysis examines the benefits of telemedicine in providing health care at a lower cost and outlines the current barriers to expansion: “Entrepreneurs are using the telephone, the Internet and personal computers for innovative solutions to traditional problems of health care delivery. These advances are not only making care more accessible and convenient, they are also raising quality and containing medical costs.”

Convenient Care and Telemedicine
http://heartland.org/policy-documents/convenient-care-and-telemedicine
This study examines the contribution of telemedicine and other information technology to innovative solutions to some of the problems patients and health care providers encounter under the traditional model of health care delivery. It also identifies obstacles to progress and the public policy changes needed to remove them.

3 Solutions for Major Telemedicine Barriers
http://www.beckershospitalreview.com/healthcare-information-technology/3-solutions-for-major-telemedicine-barriers.html
This article from Becker’s Hospital Review discusses a recently published study in Telemedicine and e-Health which found three major barriers to telemedicine implementation and use that must be addressed.

Crossing the Telemedicine Chasm: Have the U.S. Barriers to Widespread Adoption of Telemedicine Been Significantly Reduced?
http://heartland.org/policy-documents/crossing-telemedicine-chasm-have-us-barriers-widespread-adoption-telemedicine-been-
Widespread telemedicine adoption has been stymied by unnecessary technological, financial, and legal barriers for 40 years. In addition, business strategy and human resources have contributed to the delay of implementation. Cynthia LeRouge and Monica J. Garfield canvass recent events and activities in these areas and overall U.S. health care reform that might help to break down these barriers.

 

Nothing in this Research & Commentary is intended to influence the passage of legislation, and it does not necessarily represent the views of The Heartland Institute. For further information on this subject, visit The Heartland Institute’s website, and PolicyBot, Heartland’s free online research database.

If you have any questions about this issue or The Heartland Institute’s website, contact Lennie Jarratt, a state government relations manager at The Heartland Institute, at ljarratt@heartland.org or 312/377-4000.

Author
Matthew Glans joined the staff of The Heartland Institute in November 2007 as legislative specialist for insurance and finance. In 2012, Glans was named senior policy analyst.
mglans@heartland.org @HeartlandGR