Anticipating Economic Returns of Rural Telehealth

Originally published by Rick Schadelbauer on March 28, 2017

Rural Americans face a number of very dramatic health challenges. They tend to be older, less affluent, and subject to higher instances of chronic disease than their urban counterparts. Despite the fact that the United States as a whole spends more on health care than any other Organization for Economic Cooperation and Development country, rural Americans continue to face lower life expectancies than those living in urban areas.

Telehealth—“the remote delivery of health care services and clinical information using telecommunications technology”—holds tremendous potential to improve the quality, cost and availability of health care in rural areas.

A recent Smart Rural Community (SRC) white paper, “Anticipating Economic Returns of Rural Telehealth,” outlines the case to be made for increasing adoption of telehealth in rural areas, and throughout the country. 

According to the paper, the nonquantifiable benefits of telehealth are numerous: improved access to specialists, speedier treatment, the comfort of remaining close to home, eliminating the need for long-distance transportation, the ability for health care providers to sharpen their skills, and improved patient outcomes.

"It is critically important to remember that rural telehealth’s role in addressing the significant health problems inherent to rural areas will depend upon the availability of an underlying, future-proof, fiber-based broadband infrastructure."

The paper quantifies several categories of quantifiable benefits of telehealth: transportation cost savings (median cost savings: $5,718 per medical facility, annually); lost wages savings ($3,431 per medical facility, annually); hospital cost savings ($20,841 per medical facility, annually); and increased revenues for local labs ($145,109 per medical facility, annually) and pharmacies ($8,558 per medical facility, annually.)

Realizing these benefits will first require overcoming a number of difficult challenges, including reimbursement, cost, patient privacy, and licensing.

As potentially significant as the potential benefits to telehealth—both nonquantifiable and quantifiable—may be, it is critically important to remember that rural telehealth’s role in addressing the significant health problems inherent to rural areas will depend upon the availability of an underlying, future-proof, fiber-based broadband infrastructure. Further investment in, and expansion of, broadband infrastructure is a critical need not only for rural Americans but also our country as a whole. Absent access to such an infrastructure, the benefits of telemedicine will remain merely theoretical.


For more information about Smart Rural Community, visit www.ntca.org/smart.