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The Business Case for Tele-emergency.
A Clinton MacKinney1, Marcia M Ward1, Fred Ullrich1
11 Health Management and Policy, University of Iowa , Iowa City, Iowa.
Summary
Tele-emergency services can be profitable for rural hospitals. Optimizing emergency department (ED) processes and substituting physician staffing costs are key to realizing financial gains from this telehealth expansion.
Area of Science:
- Health Services Research
- Telehealth
- Emergency Medicine
Background:
- Tele-emergency offers real-time emergency medicine consultations to remote EDs.
- Financial analyses of tele-emergency services are scarce in existing literature.
- This study establishes the business case for implementing or continuing tele-emergency programs.
Purpose of the Study:
- To evaluate the financial viability of tele-emergency from a critical access hospital (CAH) perspective.
- To analyze the potential profit and loss associated with tele-emergency services in rural settings.
- To identify financial scenarios influencing the success of tele-emergency programs.
Main Methods:
- Defined 10 financial analysis categories for CAH tele-emergency evaluation.
- Utilized data from Avera Health's eEmergency program via interviews and site visits.
- Augmented Avera Health data with national statistics for comprehensive analysis.
- Analyzed three distinct financial scenarios to determine CAH profit/loss.
Main Results:
- A high revenue/low expense scenario yielded a profit of $187,614.
- A midrange financial scenario resulted in a profit of $49,841.
- A low revenue/high expense scenario indicated a loss of $69,588.
Conclusions:
- Tele-emergency can be a profitable service line for rural hospitals.
- Adjusting ED processes to leverage tele-emergency revenue and savings is crucial.
- Primary cost savings are achieved by substituting physician ED backup and staffing costs.