(This is the second part of a series on making money in telemedicine. See Part 1 here)
Telemedicine: Investment and Revenue
Most physicians have put together a telemedicine response for COVID19. But Is it scalable and secure for an ongoing telemedicine practice? If not, your business will be losing patients and money.
1. Set Up a Telemedicine Practice In-House
Incorporating telemedicine into your practice requires an investment, but the end result can be millions in revenue. Corporate telemedicine firms have the market share, but their models and hiring practices are new. It’s unclear how profits or shareholder value will affect the patient (and physician) experience in the future.
Employers have been searching for a solution to rising healthcare costs. Telemedicine is the holy grail. State governments are incentivizing the use of telemedicine over ambulatory care. In the long term, having an in-house telemedicine operation is the best way to retain patients and grow your practice.
Map out your business strategy. Telemedicine requires changes in workflow, processes, and systems. It’s not unmanageable but it does require defined parameters.
- Set financial goals – what are your expectations?
- How will you measure ROI?
- Patient Gain vs Patient Retention
- Multistate Licensure
- What’s the Model
- One dedicated telemedicine practitioner
- All doctors/PA/nurse practitioners
- Do you need to recruit?
- Calculate the investment
- Service Delivery
- Remote monitoring
- System integration
- New billing codes
- Workflow changes
- Notify payment providers
- How do you identify/connect with new patients?
- Organic outreach or paid ads
This is just a high-level outline – adapt it for your practice.If you plan to service patients out of state, begin the licensing process immediately. It can take months and fees vary by state. California, New York, and Florida are suggested for maximum outreach.
Choose a Video Platform
A platform that hosts telemedicine sessions must be HIPAA-compliant. That seems like a given, but how they secure data and protect patient privacy requires due diligence. You can be held liable for those practices.
Every telemedicine platform and practitioner sign a BAA (Business Associate Agreement). Both are responsible for HIPAA compliance. The platform has the most to lose from non-compliance (or a hack) but don’t take anything for granted.
You have responsibility for office systems and mobile devices used for patient interactions. To meet security standards for PHIPA compliance (or PIPEDA in Canada) use 256-bit AES encryption. Check with a Health IT professional if you need help.
Also, be aware that states have different telemedicine policies – a great map here to check.
Top Telemedicine Platforms
Here are four telemedicine platforms for physicians who plan to incorporate telemedicine. This is just a small sample of available firms. If your practice has hospital privileges, check to see if they have a preferred provider.
We recommend you take advantage of any free trials or demos to try before you buy. Confirm the speed of the service at different times during the day. Most internet providers have sufficient bandwidth, the issue is consistent bandwidth.
How scalable is the service? Will they be able to handle a resurgence of the coronavirus or the flu season?
The first thing is a high-quality webcam for broadcasting, not the one on your laptop. Get a professional webcam, preferably with a wide-angle lens. The improvement in image and audio quality will surprise you. These cameras are inexpensive and easily installed.
Consider keeping a separate computer for telemedicine to maintain security. Install a secure browser and remove any applications that aren’t necessary for telemedicine consults. Don’t use it for email or social media. Medical data is a prime target for hackers. Don’t make it easy for them.
Make sure to position your monitor properly. The screen should be at eye level and far enough away to frame you on the screen. Too close or too far can be disconcerting for patients. Do some tests to find the perfect spot. Avoid fluorescent lights. Be conscious of special requirements for patients who are visually or hearing impaired.
Buy tablets for the video consult team. Tablets do the same thing as a phone but on a bigger screen. It can be hard to see a group on a phone screen. Every device you have that is used for telemedicine needs strong malware protection.
IT support is essential. Things will happen. Networks go down, devices get lost, firewalls and security needs to be monitored. Very few medical practices have in-house IT support. If you have an arrangement with a third party, review the contract to see what it covers. If you don’t, hire a Health IT company. IT response time will directly impact the percentage of your revenue from telemedicine.
Appearance. Always present yourself on camera the same way you would in a face-to-face consult. Don’t dress up or down, maintain a professional appearance.
Listen. One of the biggest complaints patients have relates to communicating with physicians. That can be compounded during digital interactions.
Mute, Mute, mute. One thing we’ve learned during quarantine is the problem with background noise. Toilets flushing, phones ringing, talking to family members – not professional.
Verbally Affirm. Chronic physical and mental conditions can be an emotional topic for patients. Showing empathy or understanding of those feelings comes across differently in a video. It helps if you verbally assert your concern.
Educate Your Patients
Telemedicine is a major initiative. Patients have questions. Use your website and social media to launch your rollout.
On your website, write up an explanation of how patients engage with the service. From registering an account to scheduling an appointment to joining the consult – keep it simple and concise. Make sure there’s an option for support, like a chatbot. An FAQ page is a must.
Provide links to any apps you want them to use. Produce a how-to- video to explain the features and benefits. Remember this is new for patients too. Some will be tech-savvy. Others not so much.
When the logistics are addressed, plan how the practice will deliver services. Not everyone is comfortable doing video consults. If that’s the case, let them manage remote care via phone calls.
Specify one or two doctors to conduct video consults. Nurse practitioners and physician assistants can also consult.
Depending on the practice structure, doctors can work part-time at a telemedicine firm and still be employed by your practice. Initially, an experienced provider will provide insight into how telemedicine works.
Make sure everyone is clear on their role, including any changes in compensation. If you’ve been planning on hiring another physician, this may be the time. Corporate telemedicine companies are scooping up talent.
Insurance providers cover telemedicine sessions but confirm the details with any providers or networks. Update your systems to include the new codes.
The coding and billing issues can be complicated. It’s important to provide the necessary training and support for the billing staff. If reimbursement stalls because of a system glitch or improper coding, it’s a mess to untangle. Consider a telemedicine billing specialist to get your system set up properly.
There is no way to provide a definite number. Every practice will have unique variables. These estimates are based on an assumption there are 4 physicians and 6 staff members in a single location. We’re using the highest estimate for each category. You may be able to find more affordable resources.
*number rounded to the nearest dollar
It’s safe to assume there will be other unanticipated costs involved. We didn’t include costs we assume your office is already covering, such as maintaining the EHR. It’s reasonable to assume a total of $100,000 to get your telemedicine practice up and running.
Forecasting revenue is just as variable as estimating cost. The table below shows some reimbursement rates by code for telemedicine services (Check-in, Store and Forward, and Remote Monitoring.) The reimbursement rates will no doubt change, but this gives you some idea of revenue potential.
We assume this is a practice with 4 physicians and an office staff of 6. The revenue estimates are based on a primary care practice. Payments may vary by location and specialty.
The revenue per day represents an operation running at maximum capacity, 8 hours a day, 480 minutes. It will take time to reach that volume.
Below the chart are estimates of annual revenue potential and calculation details. Consider them a baseline to help you find the numbers for your practice.
Annual revenue is based on a 228-day work-year, assuming 8 hours per day or 480 minutes. * Reimbursements are rounded to the nearest dollar.
Virtual Check-ins can be completed by administrative staff. We’re estimating 20 patients a day, 15 for verbal and 5 for text. The total annual revenue is $259, 920.
e-Visits must be conducted by physicians, nurse practitioners, or physician assistants. The visits involve storing or forwarding EMRs. There’s no average number to work from – here’s what we used for the calculation:
- 5-10 minutes: 4 providers at 15 transactions each per day: Annual revenue is $218,880
- 11-20 minutes: 4 providers at 10 transactions per day: Annual Revenue is $282,720
- 21+ minutes: 4 providers at 10 transactions per day: Annual Revenue is $456,000
Telephone consults must be conducted by physicians, nurse practitioners, or physician assistants. These are the assumptions we made:
- 5-10 minutes: 4 providers at 15 transactions each per day: Annual revenue is $629,280
- 11-20 minutes: 4 providers at 10 transactions per day: Annual Revenue is $1,039,680
- 21+ minutes: 4 providers at 10 transactions per day: Annual Revenue is $1,003,200
Remote Patient Monitoring is a two-fold activity, collecting the data and communicating with patients about it. The revenue calculations are as follows:
- Initial setup and patient instruction: 4 providers at 10 transactions per day: Annual Revenue is $173, 230.
- Data capture and alerts, per 30 days: 4 providers at 10 transactions per day: Annual Revenue is $565,440.
- Clinical care on outcomes, 1st 20 minutes: 4 providers at 10 transactions per day: Annual Revenue is $474,240.
- Each additional 20 mins: 4 providers at 10 transactions with 1 extra 20 per day: Annual Revenue is $306, 432.
As noted earlier, these numbers are not specific to any particular practice. If you have data on transaction volume, it’s not difficult to set up a spreadsheet using real variables. If they’re anywhere close to these numbers, the $100,000 investment is going to pay off in a big way.
- Set reasonable financial goals. There’s a substantial investment to recoup, but more money to be lost if the practice does nothing. Set measurements and track your progress.
- Medical professionals – especially the physicians – need to be on board. If some have concerns about practicing telemedicine, they need to be resolved.
- Transition to telemedicine by to the whole team, including staff. Introduce the delivery model, answer questions.
- Train everyone. Workflow is going to change. The technology they use may change. People are going to make mistakes. Create a culture that encourages problem-solving, not finger-pointing.
Innovation and Efficiency
The pacemaker was invented in 1958. It was revolutionary in its day. Similarly, the technology of telemedicine reimagines preventative care.
Devices report their findings automatically to a secure drive. Implanted sensors capture abnormal heartbeats. Diabetics wear socks with heat sensors to detect foot ulcers. Blood sugar, blood pressure, temperature, medication monitoring. These data are collected and transmitted using a smartphone.
In 2017, the FDA approved the first digital pill, prescribed to mental health patients. An edible sensor is ingested and transmits data to a skin patch. That patch will transfer the data to a medical office by connecting to a smartphone.
Artificial Intelligence (AI) is emerging as a diagnostic tool. There are currently efforts underway to develop an interactive virtual nurse. When applying AI to diagnosis, the technology can identify diseases before the appearance of symptoms.
If you’re not doing intake online, that’s the first system to investigate. Get rid of redundant data entry for patients and staff alike. Once the info is captured by the system, it’s stored in the patient’s EMR. Patients can update changes in contact information as needed.
Here’s a buyer’s guide that explains intake systems and shows you what you need.
Epocrates is a free app for checking drug compatibility and calculating doses. Their database includes access to guidelines and safety recommendations. Thousands of pharmaceuticals are listed along with a pill ID.
Medscape is a similar app that’s also free. It breaks the data out into three sections. It also includes a news section for alerts on articles, research, or public policy.
Telemedicine is essential for a financially healthy practice. There’s no escaping the future.
- By doing nothing, your practice is in jeopardy of becoming obsolete.
- Corporate telemedicine firms are pulling business from ambulatory practices.
- Don’t assume that older adults don’t accept telemedicine. They’re quite capable and willing to do so.
- Patients are more concerned about access to healthcare than access to a specific physician.
- Physicians can split their time between their practice and a corporate firm.
- Setting up your telemedicine practice takes an average investment of $100,000.
- Doctors make more money from telemedicine in-house than getting paid by a telemedicine firm.
- Employers are looking to telemedicine to reduce health care costs. Without it, you may lose access to patients and jeopardize a major source of revenue.
Don't get left behind. Free sign up today.
Our best 100% free content only for email subscribers. We never spam. Plus it's against the law.
You must confirm your email address to proceed.