Telehealth Reimbursement a Barrier for Rural Hospital EDs

Despite having a high need for telehealth use, rural hospitals see a significant lack of emergency department telehealth services due to telehealth reimbursement barriers and low patient volumes, according to a JAMA Health Forum report.

Many patients who seek care at small, rural emergency departments are frequently referred to urban health systems to receive specialty care. Some smaller hospitals struggle with costs to begin with due to low usage by patients and transferring patients to another center only hurts their finances further.

Implementing telehealth programs in rural EDs has the potential to combat this problem. If patients could receive specialty services via telehealth, then smaller EDs could retain more patients and stabilize their finances, the report noted. Telehealth may also improve health outcomes in small EDs, but they are the least likely health system to use it.

For example, using telehealth to care for acute strokes has yielded positive patient outcomes and is known to benefit low-volume hospitals the most. But larger hospitals in suburban areas are much more likely to employ telestroke care for their patients.

Telehealth use also has the potential to reduce the need for physician recruitment in EDs and lower the risk of malpractice. Telehealth may increase hospitals revenues as well due to reduced transfers and increased admissions.

Despite these potential benefits, small EDs are unlikely to use telehealth due to the many barriers they face.

Telehealth costs and reimbursement are significant barriers for small hospitals. Implementing a telehealth program can cost anywhere from $17,000 to $50,000 for equipment and internet connectivity, the JAMA researchers noted. On top of that, the average annual subscription fee is $60,000 with additional maintenance and connectivity expenses between $3,000 and $8,000 each year.

Small hospitals usually see low admission rates which means a lack of substantial cash flow to cover the expenses of telehealth. Low patient volume is also a barrier. Reimbursement from only a few consultations is often not enough to cover the total cost required to provide telehealth services.

Providers may also be hesitant to learn how to use telehealth technology if only a few patients are requesting telehealth visits.

The current reimbursement system for EDs also presents a telehealth barrier.

“EDs pay for the telemedicine service, but the reimbursement goes to the telemedicine consulting specialist,” the JAMA report explained.

“While EDs can bill on behalf of clinicians, which would defray subscription costs, few do so because the administrative barriers of credentialing and licensure are prohibitive across multiple insurers, especially given the low volume of consultations and the amount of reimbursement per visit.”

There are a number of changes that may help increase telehealth adoption in rural EDs.

To ensure that EDs will be able to cover telehealth expenses, reimbursement could go directly to the ED where a patient receives acute care services. Small hospitals could also increase their telehealth consultation costs to even out the low patient volume.

Coordinating centers for small hospitals could contract services as a collaborative, which may generate a cumulative volume and demand for telehealth.

“This coordination model could be built into the 12 regional resource centers supported by the Health Resources and Services Administration,” the report stated.

“These centers provide resources for telehealth education, training, and implementation assistance, including tools for navigating regulations and reimbursement policy. These centers could be expanded to consolidate administrative load and aggregate the number of patients from smaller rural sites in their region.”

Small rural emergency departments stand to benefit from telehealth use, and these policy changes that tackle reimbursement hurdles may lead to more EDs adopting telehealth services.