[Saving billions with telemedicine--fact or fiction?]

Some claim that telemedicine technologies can save "billions" in health care expenditure. This study is a review of economic studies of telemedicine applications.

In economic evaluation resource use (costs) is compared to the health benefits generated. If telemedicine technologies have lower costs and equal or greater benefits than traditional methods, the former should be chosen. If telemedicine is more costly, but generates greater health benefits, society have to judge whether the benefits justify the costs. These issues are explored in cost-effectiveness and cost-utility analyses. We started off with a review published by the International Network of Agencies for Health Technology Assessment (INAHTA). We updated this review to December 1999 by searches in various databases.

The INAHTA report included 19 economic analyses of telemedicine applications; in addition we identified 11 studies from last year. Three of the studies had been undertaken in Norway while the majority stemmed from North America. Only three studies made an assessment of health outcome while the others were various types of cost analyses. The majority of the studies were of low to moderate quality. Sixteen studies concluded that telemedicine was a cost-saver, three concluded opposite while the others had more "neutral" conclusions.

Telemedicine technologies can save costs, but their impact on health outcome is largely unknown. Whether a specific technology is a cost-saver will depend on its type, the cost structure of the health care system, patient volume, and geographic factors. Taking into account the limitations of the studies, we conclude that the cost-effectiveness of telemedicine methods is not established. The claim that telemedicine can save "billions" is not backed by research.