Challenges Facing the Telehealth Industry

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Woman looking at scans while wearing a headsetHealth care costs have been increasing for consumers, driving them to make different choices in their care. Some skip seeing a doctor, or order generic drugs instead of brand name ones; some don’t go to follow-up care, or skip a procedure or treatment. A significant percentage of patients ask about alternative care or treatments because of costs.

These phenomena have spurred the tech and medical communities to think about telehealth as an alternative to traditional health care. “Telehealth” is not a very well defined term, and describes a variety of technologies as a means to deliver medical, health and education services. Thirty percent of patients already use computers and mobile devices for medical and diagnostic information. Everything from checking Web M.D. to scheduling a doctor’s appointment on an iPhone could be considered telehealth.

But the implementation of telehealth technology poses some challenges. This may make it difficult for its wide implementation as a means to expand health care access and reduce costs. Here are some telehealth challenges:


Payment parity — reimbursement and coverage for telemedicine services comparable to those of in-person services — is a big challenge for telehealth. There is no guarantee of payment parity between telemedicine and in-person health care. Even in the 28 states in which payment parity laws have been passed, no apparatus exists to enforce it. This could potentially defeat the point of telemedicine to reduce health care costs and expand access to services , and could also discourage providers from offering telehealth because there is no guarantee of comparable payment.


Misdiagnosis happens often in in-person health care, but the risks increase with telehealth. Add to this the fact that there is no clear standard of care established by state legislatures, and quality may be uneven between one provider and the next.

Misdiagnosis has the potential to drive up overall costs to the general health care system as well, because misdiagnoses leads to wrong prescriptions and treatments. According to the CDC, one third of antibiotics prescriptions are already unnecessary. Additionally, if a telehealth service cannot determine a diagnosis, the patient may be counseled to go to an ER or an urgent care service. If these visits are unnecessary, they may result in a large cost to both the patient and the system as a whole.

Widespread Implementation

The government has been attempting to address patient demand for telehealth by passing legislation like CONNECT (Creating Opportunities Now for Necessary and Effective Care Technologies), which expands the availability of services provided through telehealth under Medicare.

The challenges of widespread implementation of telemedicine encompass many different areas, because “telehealth” can refer to so many different things — from robotics to telephone consultations. Some of the responsibility of implementation resides with the legal system, and rests with the government. Some is institutional, and rests with local hospitals and health care institutions. Also, some of the challenges are financial, and require the effective utilization of business strategy and human resources.

Telehealth Vendors

One unique challenge of utilizing telemedical technologies on an extended scale is how to account for the vendors. Vendors are integral to the process, but they are not held responsible nor are they compensated for individual cases. Additionally, the line between provider and care platform is sometimes blurred when it comes to telehealth vendors.

When health care programs like Medicare reimburse telemedicine services, it’s difficult to tell exactly what is being paid for, and it’s challenging to determine the exact rates of payment because the product comprises both the service and the technology. Then there are questions about whether a health plan should contract directly with a telemedicine vendor or let the vendor contract with providers, as well as how plans can ensure quality of services.


While there are many obstacles that may give us pause, we have already seen some positive results of the implementation of telemedicine services. For instance, with the introduction of virtual care there has been a significant decrease in inpatient days and ER use for patients with diabetes. Because telehealth comprises such a vast quantity of technologies and services, much of its widespread implementation will be an ongoing experiment to determine best practices. The methods and technologies that integrate well into health plans will survive, saving money and expanding care in the long term.

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Advisory Board, “Who’s at the telehealth table? Challenges facing providers, vendors, and government”
McKesson, “The Challenges and Opportunities of Telemedicine”
NRTC, “Telehealth: Overcoming the challenges ofimplementing innovative health care solutions”