Perspectives in Telemedicine and Healthcare Risk Management

Summary Written by Maryann Taylor

The morning session included a presentation by Brian Kelly and Mike Midgley of Swiss Re on the revolutionary technological progression in the healthcare industry, changing the way we access, deliver and receive care. They discussed some of the current applications and future possibilities for expansion and use, including in the workers’ compensation sector in which it is not yet prevalent but ripe for application. Also highlighted was some of the associated risks and challenges telemedicine poses for the insurance industry, such as with professional liability and general liability lines as well as other enterprise risk management considerations. 

Telemedicine is a significant and rapidly growing component of modern healthcare in the U.S.  It is becoming increasingly popular and experiencing a growth surge. According to recent studies, 60% of physicians were interested in using video appointments. 90 % of healthcare executives said their organizations are currently implementing or developing telemedicine programs and experts estimate that telemedicine will attract 7 million patient users by 2018. Over 250 pieces of legislation have been proposed in over 40 states regarding telemedicine.  Also at the state level, 33 states have mandated private payer reimbursement for telemedicine services. Telemedicine is being embraced by consumers, providers and insurers alike. 

One definition of telemedicine is the use of telecommunication and information technology to provide clinical healthcare from a distance. It has been used to improve access to medical services that would often not be consistently available in rural communities. Many rural communities are described as primary care deserts. Telemedicine can lead to better quality care with more health care provider interaction. It allows for more frequent follow-ups to manage chronic conditions. It may also be a quicker way for routing to preferred professionals to get a second opinion on a medical diagnosis. Patient convenience is a significant factor in users expressing a preference for telemedicine care options. Generally, telemedicine encounters are less costly than in-person visits and once the initial investments in the technology is made, it can lead to sustained cost savings.

Although telemedicine holds a lot of promise for primary care providers and patients, it is not without potential drawbacks. One such drawback is that not all procedures a patient may need can be performed remotely. Physical therapy, for example, frequently requires the use of equipment and often the personal face-to-face motivation of the therapist cannot be replaced. Other barriers include compliance with state laws and regulations. Doctors must be licensed in each state and issues arise when crossing state lines. Skeptics are also critical as to whether it will actually result in substantial cost savings or be cost neutral. Cybersecurity is also of grave concern implicating privacy and security issues. Compliance with legal and regulatory rules also present barriers. HIPAA requirements are applicable as well as rules on documenting patient encounters and prescribing drugs for pain management. 

Telemedicine presents a distinctive set of risk management concerns. Risk managers and insurance professionals recognize a multitude of potential risks associated with telemedicine services. Using an enterprise risk management (ERM) approach, risk managers assess these risks categorized into eight domains: operational, clinical/patient safety, strategic, financial, human capital, legal/regulatory, technology and hazard. Addressing important telemedicine risk issues will allow the organization to set standards and guidance around these services and be acutely aware of potential risk matters. Mitigating the risks of telemedicine allows the organization and clinical providers to deliver safe and trusted health care to patients as the use of telemedicine multiplies.