Economic Advantages of Telehealth and Virtual Health Practitioners: Return on Investment Analysis

BACKGROUND: Telehealth is a disruptive modality that challenges the traditional model of having a clinician or patient physically present for an appointment. The benefit is that it offers the opportunity to redesign the way services are offered. For instance, a virtual health practitioner can provide videoconference consultations while being located anywhere in the world that has internet. A virtual health practitioner also obviates the issues of attracting a specialist medical workforce to rural areas, and allows the rural health service to control the specialist services that they offer. OBJECTIVE: The aim of this research was to evaluate the economic effects of 3 different models of care on rural and metropolitan hospital sites. The models of care examined were patient travel, telehealth using videoconferencing, and employment of a virtual health practitioner by a rural site. METHODS: Using retrospective activity data for 3 years, a return on investment (ROI) analysis was undertaken from the perspective of a rural site and metropolitan partner site using a telehealth orthopedic fracture clinic as an example. Further analysis was conducted to calculate the number of patients that would be required to attend the clinic in each model of care for the sites to break even. RESULTS: The only service model that resulted in a positive ROI for the rural site over the 3-year period was the virtual health practitioner model. The breakeven analysis demonstrated that the rural site required the lowest number of patients to recoup costs in the virtual health practitioner model of care. The rural site was unable to recoup its costs within the travel model due to the lack of opportunity for reimbursement for services and the requirement to cover the cost of travel for patients. CONCLUSIONS: Our model demonstrated that rural health care providers can increase their ROI by employing a virtual health practitioner.