Technology has long been touted as a key to lowering the cost and improving the quality of healthcare. Digitizing patient records, using electronic devices to monitor things like patient glucose levels at home, and using broadband to transmit the information to doctors – all hold amazing promise.
But so far most of the medical establishment has resisted such innovations. Doctors don’t want to pay for the systems required for digital records and few insurers have been willing to reimburse for the cost of remote monitoring devices. “Right now doctors aren’t reimbursed for reviewing transmitted patient records. They are paid for seeing patients,” said Steve Dean, medical marketing director at Texas Instruments, whose chips are used in a broad swath of medical equipment, including remote monitoring and diagnostic devices. “The reimbursement climate needs to be re-engineered to provide caregivers incentive to review remote patient monitoring data.”
That may be happening. Both the American Recovery and Reinvestment Act (ARRA) passed in February and the healthcare reform bill passed over the weekend by the US House of Representatives contain provisions that not only encourage the use of technology, but could also change the way it’s paid for.
“The biggest barrier we’ve had is reimbursement,” said Alice Borrelli, director of global health and workforce policy at Intel Corp. (Intel’s Digital Health Group has developed a personal health product called the Intel Health Guide.) The old model is to pay – and reimburse – for each service, procedure or medical device separately. But healthcare reform focuses on a model based on care management, in which a primary physician provides and coordinates overall care for the patient in the most effective, efficient manner. That approach could make technology an integral part of the system. “You start to look at health IT as being a [way to enable] this comprehensive approach,” she said. “It’s a different way of paying for healthcare.”
If the final healthcare reform legislation includes that approach, then “tech companies like ours are going to start investing more in applications because they are going to see that now this is going to be a reimbursable benefit,” noted Borrelli.
The tech industry is hopeful about the prospects. The US market for wireless home-based healthcare applications and services will grow from $300 million this year to become a $4.4 billion industry by 2013, according to Harry Wang, director of health and mobile products research at Parks Associates. And technology companies are lobbying to get particular technologies into the bills being considered. For example, the Continua Health Alliance, a group of more than 220 healthcare and technology companies, was originally formed to develop interoperability guidelines for health monitoring technology. Lately, however, it has become more active in promoting remote monitoring technology in the healthcare reform debate, said Charles Parker, Continua’s executive director.
The ARRA devotes about $20 billion for healthcare IT, according to IDC. Continua helped get specific mentions of the use of remote monitoring equipment included in the reimbursement provisions for physician’s practices, said Parker. Under these provisions, doctors who adopt certified software and provide “meaningful use” of technology can qualify for reimbursements of tens of thousands of dollars a year, starting in 2011. And Continua has also pushed to get specific mentions of remote monitoring technology into the healthcare reform bill.
The Senate Finance Committee’s bill includes several specific provisions promoting healthcare IT and electronics, according to Intel’s Borrelli. Although many of the provisions apply only to Medicare, private insurers usually follow Medicare’s lead. Specifically, the bill:
• Sets aside $10 billion over 10 years for the Centers for Medicare and Medicaid Services (CMS) to develop pilot programs to coordinate care for chronically ill Medicare patients at high risk of hospitalization. CMS is required to look at a model that uses a “health IT-enabled network that includes a chronic disease registry, home tele-health technology, and care oversight by the beneficiary’s treating physician.” It also must consider the use of EHRs (electronic health records) and remote monitoring systems.
• Specifies that starting in 2011 Medicare will provide annual wellness visits and comprehensive risk assessments for patients. The assessment could be provided either in person or through an “interactive telephonic or Web-based program.”
• Includes a provision about home healthcare, where the primary care physician is responsible for coordinating the total care of the patient. This provision includes references to using technology to link and/or provide services.
• Promotes the development of EHRs to facilitate the collection of performance measurement data.
Yet, despite these high hopes, how broadly such technologies are embraced depends on much more than a new law. Even if final legislation includes these provisions, for example, the rules made to carry out the law will be critical, said Parker. There is still a lot of uncertainty about the ARRA reimbursements for physicians, for example, because the rules still aren’t defined, noted Thomas Handler M.D., a research director at Gartner Inc. It’s still unclear what organization will certify the software packages. And the term “meaningful use” has yet to be defined. (CMS is expected to issue some guidance in December.)
Remote monitoring is unlikely to gain a foothold until EHRs are established. “We need an adoption level of EHRs in physician’s offices in order for our data to have a home,” admitted Parker. Gartner forecasts that less than 15% of physician practices and hospitals will have adopted EHRs within five years.
In fact, Handler thinks an entirely new health IT infrastructure will be required to support remote monitoring. Imagine how much data would result from remote monitoring, for example, 1,000 diabetics’ glucose levels three to four times a day, he noted. A physician can’t be expected to sort through all that data. “What we would expect to see, but it hasn’t happened yet, is a clearinghouse,” explained Handler. “All those glucose tests would get dumped into a data repository that has clinical decision support rules that then look through thousands of data points and identify those glucose readings that are out of whack.”