What Telemedicine’s Growth Rate Means for the Industry

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Telemedicine's growth rate is soaring

In the state of Georgia, patients in a nursing facility are allowed only one telemedicine consultation every 30 days. In Indiana, the state will only reimburse a patient for a telemedicine consultation if they are at least 20 miles away from their healthcare provider. If a patient wishes to use the internet to remotely access PTSD therapy out of a hospital in Illinois, they must reside in Illinois. Colorado is the only state in the union where Medicaid covers patient-doctor consultations via audio calls, messaging, live video conference, and through remote patient monitoring. 

Amid–and perhaps despite–this diversity of regulations, telemedicine’s growth rate continues to soar. Few emerging technologies are subject to such restrictive and widely varied regulations as healthcare delivered via digital technologies, but rapid innovation continues and financial forecasts for the future reach new heights every year.

Telemedicine is one of the great opportunities of the digital revolution, but whether it can ultimately deliver on its projected potential is contingent on the bureaucratic world around it making things a lot easier.

Regulation Variations

The examples of state-by-state telemedicine regulations listed above were drawn from a recent study on the nationwide governance of the industry. The review concluded that 12 states had “restrictive” telemedicine laws, and less than half were considered “progressive.”

The ambiguity of telemedicine regulation is impeding the practical evolution of the technology.

This variation in telemedicine regulations is reflective of an industry that is trying to strike a balance between maintaining quality patient care standards and embracing the innovation of digital technologies. The challenge is typified by the conflict between maintaining medical jurisdictions and exploring the unbounded nature of remote healthcare delivery. It throws up inconsistencies all over the map. The Indiana example above insists on a minimum distance between patient and provider, while the Illinois example–drawn from another case study–promotes proximity of the in-state kind.

This ambiguity of regulation is impeding the practical evolution of the technology and restricting governmental infrastructure investment and support for a field that has the potential to extend the reach of expert healthcare. As an example, only around 16 percent of physicians work at a site that uses telemedicine.

Despite this seemingly unfertile ground, the telemedicine industry continues to enjoy positive financial forecasts about its future growth.  

Telemedicine’s Growth Rate

Telemedicine is the fastest growing avenue for healthcare delivery in the world. That fact is tempered somewhat by the fact that it is one of very few “new” avenues, so it is growing from a small base. Nonetheless, the numbers are impressive.

Telemedicine usage grew by more than 50 percent between 2016 and 2017, a figure more than triple that of the second-highest growing avenue of care, the urgent care clinic. Pushing the start date back to 2008 reveals a growth rate through 2017 of an almost absurdly high 1,434 percent, reflecting that low starting point we mentioned above. That growth translates to future annual market valuations of around $130 billion by the year 2025. Almost half of that valuation is expected to be generated within the U.S. alone, which underscores the potential in this technology.

Telemedicine can amplify the effectiveness of a relatively shrinking expert medical talent pool.

Telemedicine’s growth is largely driven by two specific areas of healthcare, each following a different source of demand. Neurology is expanding at the fastest rate, 40 percent annually, on the back of a shortage of expert physicians being called on to treat a rising rate of neurodegenerative disorders stemming from an aging population. The second is personal home telemedicine care, which is motivated by the accessibility of online services and the cost savings associated with remote delivery.

Both examples are testaments to telemedicine’s two greatest potentials: it can amplify the effectiveness of a relatively shrinking expert medical talent pool, and it can deliver such services to any location that can be connected to the internet. To maximize its potential, though, telemedicine has to be set free from its geographical bounds.

How to Make the Most of Telemedicine

There are some positive signs that telemedicine will eventually get to put its theoretically unbounded potential into practice. Several governments have sponsored in-state telemedicine initiatives that aim to deliver specialist medical services to remote and regional areas over the internet. VC Daily has previously discussed telemedicine initiatives in Texas and New Mexico, for example. While these programs don’t cross state lines, they do provide working examples of how care that equals the quality of in-person consultations can be delivered over vast distances.

There is clearly a groundswell of public and institutional support for telemedicine reflected in its multi-billion-dollar growth.

Telemedicine has also enjoyed strong support from leading healthcare institutions, including the Mayo Clinic and the Department of Veterans Affairs. These are institutions of high regard that can generate public trust and confidence in telemedicine. 

Proposing a method to achieve universal clarity on the provision of telemedicine services that would facilitate cross-border consultations and treatments is a political potato too hot for this website. However, there is clearly a groundswell of public and institutional support for telemedicine reflected in its multi-billion-dollar growth that indicates such services would be accessed if granted.

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