Why the utilization conversation in telemedicine is bigger than dollars and cents

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A study published in Health Affairs and conducted by the RAND Corporation made a big splash this week with a bold claim: That telemedicine doesn’t actually reduce healthcare costs because the increased convenience leads to increased utilization, which ultimately costs more than in-person care would have.

The study looked at claims data from a cohort of 300,000 employees with access to Teladoc through their employer. Researchers compared a cohort of telemedicine users to a cohort of non-telemedicine users and found that in the telemedicine users, visits to primary care doctors barely decreased, meaning that the Teladoc visits were mostly additive (visits that otherwise would not have occurred), rather than substitutive (visits that otherwise would have occurred in person). They found that 88 percent of visits were additive, and only 12 percent replaced in-person visits. The result: telemedicine cost the payer $45 per patient more than a plan…

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