A cost-effectiveness analysis of shipboard telemedicine

The U.S. Navy is considering the installation of telemedicine equipment on more than 300 ships. Besides improving the quality of care, benefits would arise from avoiding medical evacuations (MEDEVACs) and returning patients to work more quickly. Because telemedicine has not yet been fully implemented by the Navy, we relied on projections of anticipated savings and costs, rather than actual expenditures, to determine cost-effectiveness.

To determine the demand for telemedicine and the cost-effectiveness of various technologies (telephone and fax, e-mail and Internet, video teleconferencing (VTC), teleradiology, and diagnostic instruments), as well as their bandwidth requirements.

A panel of Navy medical experts with telemedicine experience reviewed a representative sample of patient visits collected over a 1-year period and estimated the man-day savings and quality-of-care enhancements that might have occurred had telemedicine technologies been available. The savings from potentially avoiding MEDEVACs was estimated from a survey of ships' medical staff. These sample estimates were then projected to the medical workload of the entire fleet. Off-the-shelf telemedicine equipment prices were combined with installation, maintenance, training, and communication costs to obtain the lifecycle costs of the technology.

If telemedicine were available to the fleet, ship medical staffs would initiate nearly 19, 000 consults in a year-7% of all patient visits. Telemedicine would enhance quality of care in two-thirds of these consults. Seventeen percent of the MEDEVACs would be preventable with telemedicine (representing 155,000 travel miles), with a savings of $4400 per MEDEVAC. If the ship's communication capabilities were available, e-mail and Internet and telephone and fax would be cost-effective on all ships (including small ships and submarines). Video teleconferencing would be cost-effective on large ships (aircraft carriers and amphibious) only. Teleradiology would be cost-effective on carriers only. Telemedicine's bandwidth requirement is small-1% of a month's time. However, if the ships' medical departments need to resort to a commercial satellite, E-mail and Internet would be the only telemedicine modality generating enough monetary benefits to offset the costs.