The added value of thorough economic evaluation of telemedicine networks

Abstract

This paper proposes a thorough framework for the economic evaluation of telemedicine networks. A standard cost analysis methodology was used as the initial base, similar to the evaluation method currently being applied to telemedicine, and to which we suggest adding subsequent stages that enhance the scope and sophistication of the analytical methodology. We completed the methodology with a longitudinal and stakeholder analysis, followed by the calculation of a break-even threshold, a calculation of the economic outcome based on net present value (NPV), an estimate of the social gain through external effects, and an assessment of the probability of social benefits. In order to illustrate the advantages, constraints and limitations of the proposed framework, we tested it in a paediatric cardiology tele-expertise network. The results demonstrate that the project threshold was not reached after the 4 years of the study. Also, the calculation of the project's NPV remained negative. However, the additional analytical steps of the proposed framework allowed us to highlight alternatives that can make this service economically viable. These included: use over an extended period of time, extending the network to other telemedicine specialties, or including it in the services offered by other community hospitals. In sum, the results presented here demonstrate the usefulness of an economic evaluation framework as a way of offering decision makers the tools they need to make comprehensive evaluations of telemedicine networks.

Institutionalizing Telemedicine Applications: The Challenge of Legitimizing Decision-Making

“…First, the cost of a telemedicine application has to be measured and compared with the alternative clinical practice [29,30,42,56-58]. Second, relative efficiency with other alternative health care strategies is critical for decision making when resources are limited [11,29,30,58-60]. …”

“…Additionally, the telemedicine application has to be used over an extended period of time [30,58], thus attesting to the so-called proof of time .…”

The Use of Telemedicine to Address Access and Physician Workforce Shortages

“…30,[32][33][34][35][36][37] Savings can be realized by a reduction in the duplication of medical tests and examinations, a reduction in the utilization of higher-cost tertiary care centers, and an increased efficiency in referrals and communication. Beyond these savings, there are many societal benefits, including the reduction in travel and patient transport, a reduction in the hours of missed work by the parent/guardian, and a reduction in the frequency of missed school days.…”

Custo-benefício do serviço de telecardiologia no Estado de Minas Gerais: projeto Minas Telecardio

“…The present study intentionally followed the established recommendations 11,12 and specifically addresses the quality questions evaluated in the economic analyses, especially the definition of the evaluated alternatives, with its clearly defined costs, measured and estimated in appropriate and credible units, and adjusted for different moments of collection. It also highlights the sensitivity study, which allows the evaluation of the results with a variety of scenarios and the use of two perspectives: the government's point of view, from the perspective of funding and society's, which also includes patient costs 16 .…”

“…In fact, it is recommended that economic analysis in tele-health consider the social gain, which is the sum of benefits and economic outcomes related to external effects, not considered in the initial analysis 16 .…”