Inf Syst Front (2006) 8:211–223 DOI 10.1007/s10796-006-8780-2
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Interplay of cost and adoption of tele-medicine in Sub-Saharan Africa: The case of tele-cardiology in Ethiopia
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search, this paper examines the role of Tele-Medicine in the healthcare system and analyzes the costs and benefits of introducing Tele-Cardiology services in Ethiopia (a SubSaharan African country). This is a cost comparison study for the treatment of cardiac patients traveling abroad versus patients treated via Tele-Cardiology. Our findings show that Tele-Cardiology is clinically more feasible and more cost effective compared to patients traveling abroad for treatment.
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Abstract . . .the barriers to diffusion of Tele-Medicine are not entirely technical. Cost has to simultaneously satisfy a number of stakeholders. . . (Anderson, Aydin and Jay, et al., 1994). Rising costs of the provision of healthcare have been a major issue for debate in both developing and developed countries. This is especially true of very capitalistic societies such as the United States where privatization of the healthcare sector has left many with little or no affordable healthcare. The situation is even worse in developing economies. Developing countries deal with various problems in the provision of health services and healthcare Tan et al. (E-medicine diffusion: E-medicine in Developed and Developing countries. Chapter 8 in E-health paradigm shift: Perspectives, domains and challenges. In Tan J. (Ed.), Imprint of Wiley, New York, Jossey-Bass, 2005). Some of these problems include acute shortages of healthcare professionals and medical facilities Mbarika et al. (Journal of the Association for Information Systems (JAIS) 2005;6(5):130–170). Such shortages have resulted in growing numbers of middle to upper-class citizens of developing countries traveling abroad to seek necessary health services. Using a multi-method case study re-
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Received: 20 July 2004 / Revised: 27 December 2005 / Accepted: 28 December 2005 C Springer Science + Business Media, LLC 2006
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Mengistu Kifle · Victor W. A. Mbarika · Pratim Datta
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M. Kifle Department of Computer and System Sciences Stockholm University/KTH Forum 100 Electrum, SE-164 40 KISTA Stockholm, Sweden e-mail:
[email protected] V. W. A. Mbarika () College of Business, Department of Management, Marketing, and E-Business, Southern University and A&M College, T.T. Allain Building, Baton Rouge, LA 70813, USA e-mail:
[email protected] P. Datta Washington State University, Pullman Washington, USA
Keywords Tele-Medicine . Developing countries . Cost effectiveness . Cost comparison . Cardiology . Patient travel . Telecommunication 1. Introduction Tele-Medicine is defined as a healthcare delivery mechanism where physicians and other medical personnel can examine patients remotely using Information and Telecommunication Technologies (ICTs) (Tan et al., 2005). Tele-Medicine enables medical personnel working in remote areas to seamlessly transfer medical laboratory results and patient data to hospitals and clinics for diagnostics and advice (Kifle et al., 2005). This global technology enables remote and displaced communities to utilize otherwise unavailable specialist skills located at centers of medical excellence worldwide (Bashshur, Sanders and Shannon, 1997; Taylor, 1998; Wootton, 1995; Moore, 2002; Katstania, 2004; Nesbitt et al., 2005). Over the last decade, there have been tremendous advances in ICT infrastructure and applications, information mobility and connectivity. Even Ethiopia, where the emergence of telephony was regarded as “the work of the devil,” is undergoing major shifts (Kifle, Mbarika and Payton, 2005). Ethiopia embraced Ethio-Stream, a digital data network Springer
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Inf Syst Front (2006) 8:211–223 Table 1 Health facility to population ratio
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2. Background
Located in Eastern Africa, Ethiopia extends over an area of 1.1 million square kilometers. The population of Ethiopia is about 63.5 million, yielding an overall density of about 56.7 people per square kilometer. The rural population is about 85%. Life expectancy is low with 49.7 years for males and 52.4 years for females. All together, the present healthcare facilities and manpower available in the sector remain
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Ratio
Hospital to population Hospital bed to population Health center to Population Health station to population
1:658,305 1:4,900 1:222,850 1:27,456
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Table 2 Health professionals to population ratio Indicator
Ratio
1: 38,619 1:13,920 1:2.7 1:3,671,327 1:5,390 1:50,638 1:53, 238
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Physician to population Nurse to population Physician to nurse Pharmacist to population Health assistant to population Technicians to population Mid-wife to reproductive women
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dismal, as summarized in Tables 1 and 2 respectively (MOH, 2004). As can be seen, the personnel and facilities available are far from satisfactory. Ethiopia is a country with very poor health standards, even when compared to other countries within the Sub-Saharan African (SSA) region. Notwithstanding commendable efforts by public and private sectors in improving their facilities (MOH, 2004), Ethiopia’s basic healthcare needs are far from being achieved. In most cases, local services available do not provide patients with satisfactory medical care, especially when specialized skills are required. For example, there are less than 10 cardiologists and three heart surgeons available for a population of 71 million. Per capita healthcare expenditure is about $1.20, less than a thousandth of what the Western world commits to healthcare (USAID, 2002; WHO, 2004). In Ethiopia, more than 100,000 children are born with congenital heart disease. Two hundred thousand new cases of various types of heart diseases occur each year and an estimated 500,000 to 700,000 heart disease patients live in the country (Abdula and Worku, 2001). A 1998–1999 study with sample data from 92 autopsy reports (with accidental deaths) indicated that more than 90% of them were shown to have coronary artery disease. (Schnedier and Bezabih, 2001). The dismal statistics explain the grueling need for cardiology care. Yet, such patient care is not available in Ethiopia. The only alternative, in these cases, is seeking healthcare abroad, which is not only prohibitively expensive for the population in one of the world’s poorest countries, but also prompts an outflow of much needed foreign reserves. Under such premises, investing in a Tele-Cardiology infrastructure seems a viable and prudent option for countries like Ethiopia
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spanning the country using frame relay and Integrated Services Digital Networks (ISDN) to virtually link itself to the rest of the world. Cellular telephony is gaining popularity in leaps and bounds, linking communities and providing access, independent of land lines. The classical view of physical co-presence is suddenly being challenged by virtual co-presence. People in remote, strife-ridden, disasterstruck, or inaccessible locations can use such technologies in Tele-Medicine facilities to connect them to specialists located beyond geographical and political borders. For example, a webcam mounted on a laptop running a database to register patient diagnostics can capture and digitize important health-related data and transmit the data via mobile earth stations (e.g. Inmarsat) to other earth station satellites connected to gateways in developed countries. The audiovisual and diagnostic data can be investigated by specialists around the world to provide remedial measures or issue the need for follow-up diagnostics. The Tele-Medicine diffusion process poses some challenges for policy-makers (Mbarika, 2004). Little is known about silent factors in the various states of diffusion. Researchers have argued that the main problem in Tele-Medicine adoption is not the technology, but rather economical and institutional dimensions that impede the exploitation of such a life-saving technology (Anderson, Aydin and Jay, 1994; GAO, 1997; Wootton, 2001; Roine, Ohinmaa and Hailey, 2001; Lindeorth, 2002; Reardon, 2005). The objective of this paper is to investigate the economic issues and concerns related to the initiation of Tele-Medicine activities in developing countries. For developing countries, cheap labor, rather than technology, is the economic rationale. Adopting and implementing ICT applications imply labor substitution. Why, then, should developing countries adopt and employ Tele-Medicine applications? Is there a socioeconomic justification for this rationale? To answer these questions, we choose Ethiopia as our test bed for investigation. Given the growing healthcare problems in Ethiopia, and by extension, other developing countries, this study, put forward new theoretical perspectives to enable policy makers to better understand the states of Tele-Cardiology diffusion and factors that affect their diffusion rates.
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2.2. Costs and benefits
The public budget is the main financial source for the public health services in Ethiopia and most Sub-Saharan African countries. As a consequence of limited budget, there has been little or no investment in the modernization of the existing health infrastructure. Moreover, the advent and rampant spread of HIV takes up much of the limited healthcare resources available. Similar to the case of Ethiopia, neighboring Uganda is spending $1 billion dollars per year on HIV-related problems, from the total GNP of $6 billion. As a result, the existing healthcare infrastructures remain poorly equipped. The paucity of limited budgets, and limited healthcare facilities, coupled with the frequency of cardiac illnesses provides the motivation for conducting Tele-Medicine, especially Tele-Cardiology research (Sable, Cummings and Pearson, 2002; Sane et al., 1992). Given the meager need for sophisticated ICT infrastructure, Tele-Cardiology could substantially contribute towards meeting healthcare demands, allowing for an optimized use of existing resources in the form of experts and equipment [BMJ Editorial, 2001; Wootton, 1996; Whitten, Kingsley and Grigsby, 2000; Martinez, Villarroel and Seoane, 2005). Several models have been proposed to evaluate Tele-Medicine. Bashshur (1995) provides the classic overview of evaluation domains and argues that quality (health outcomes), access (availability, under burden), and cost must be taken into consideration assessing the impact of Tele-Medicine (Bashshur, Shannon and Sapci, 2005). Thus, cost evaluation in Tele-Cardiology is a comparison of the cost and benefits of alternative ways of providing
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The diffusion of Tele-Medicine in developing countries has mostly been initiated to address fundamental healthcare issues that cannot be handled given the acute shortages of doctors/specialists. Tele-Medicine has also been used for doctors/patients to obtain second opinion diagnostics and treatments. There is also hope that Tele-Medicine will lead to reduction in costs of medical care nationally. In addition to this, introduction of new technologies (Tele-Medicine) has been generally accompanied by claims of efficacy and cost effectiveness. According to Craig and Patterson (2005), there are two reasons for implementing Tele-Medicine in developing countries’ settings: lack of alternatives and geographic advantages of Tele-Medicine over traditional medicine. What seems to have escaped scrutiny is the economic rationale, i.e. the cost-benefit analysis of Tele-Medicine. The issue is an immediate one, especially for developing countries where capital is scarce and technology adoption is much more a function of economics rather than ease-of-use. Previous research, however, suggest that any decision to introduce Tele-Medicine must ensure that the opportunity costs are less than the benefits accrued from allocation of resources to Tele-Medicine (McIntosh and Cairns, 1997; Fauchier et al., 2005). Rogers (1995) study is one of the most commonly cited diffusions of innovation theories. In his study, Rogers suggests that the diffusion of new technology generally follows an S-shaped pattern, where the adoption rate is slow at first, but then rises quickly during a take-off period, and eventually leads to routine use. Rogers further suggests that adopters should be classified into five categories based on their adoption timing. Innovators (2.5%) are the earliest adopters, followed by early adopters (13.5%), then the early majority (34.0%), the late majority (34.0%), and finally laggards (16.0%). The technological development (Tele-Medicine) is a gradual sequence of small changes. The modern direction of Tele-Medicine technology development is more towards integrating and interconnecting the healthcare sector with Internet and telecommunication networks. Within this integrating and interconnecting direction, the obvious (and reported) benefits such as, patients not having to travel lies in time saving; patients could get medical consultation early and be treated while the illness is at its earlier stage. This implies the cost savings potential of Tele-Medicine. Moore (1995), stated that the saving could be generated from: “(i) reduce[d] costs for servicing patients, through saving in time and travel for doctors and patients, fewer unnecessary referrals, and the
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2.1. Theoretical background
replacement of doctors with less medically trained personnel supported by Tele-Medicine; (ii) cost savings from the provision of better healthcare, generating cost reductions from early diagnosis and treatment”. In addition, most healthcare organizations have identified quality and patient safety improvement as their primary drive. These organizations also acknowledge the importance of promoting patient care as well as a desire to achieve return on investment as financial incentives. Such a trend is not just a developing country’s issue, but can also be seen in the context of the developed world. In the US for example, the battle between the government and healthcare providers to bring down costs for patients has always been a major policy issue (and often very political). According to Anderson, Aydin and Jay (1994) the barriers to diffusion of Tele-Medicine are not entirely technical. Cost has to satisfy the stakeholders involved (Reardon, 2005; Brady, 2005).
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(Huston and Huston, 2000; Scalvini et al., 2005) where so much is at stake.
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Inf Syst Front (2006) 8:211–223 Table 3 Method used for tele-cardiology value assessment Measurement
Cost benefit Cost effectiveness
Compares costs and benefits Compares costs of rendering a measure of effectiveness, e.g. morbidity reduction, life year saved. The same as cost effectiveness in “health year”, e.g. quality- adjusted life years Only the cost of Tele-Medicine and alternative techniques are compared Compares alternative programs where all relevant outcome measures are equal, e.g. equal effectiveness or equal patient quality of life Number of patients for which the cost of tele-consultation is the same as conventional consultation By modifying the value of one variable at a time, the effect on total cost
Cost comparison
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Break even
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2.3. Communication service for Tele-Cardiology
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Tele-Cardiology can be applied in two forms: through the interaction between the patient and physician; or between general practitioner and specialist, made immedi-
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Fig. 1 The Tele-Cardiology adoption/diffusion curve (Adopted from Wooton, 2003)
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ately and live, without time and space variation, as a form of “synchronous” communication. The other form is the store-and-forward Tele-Medicine known as “pre-recorded” or “asynchronous” communication (Della et al., 1996; Fredriksen, Pettersen and Pedersen, 1997; Nordrum et al., 1998; Cross, 1996; Prednia, 1996; Kuntalp and Akar, 2004; Angonanakais et al., 2004). This type of application is less expensive, as there is no live interaction between the sender and receiver (Schwartz, et al., 2000; Sabale, 2003). The sending site gathers information, text, data, or images in electronic or digital form, and sends it to the receiving site for specialist examination to be reported back at a convenient time. This alternative is used for non-emergency situations, where diagnosis is made after the arrival of the results. The high cost of associated equipment and limitation of bandwidth as well as using an interactive video Tele-Medicine system (especially the cost of bandwidth transmission media), has forced many Tele-Medicine
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healthcare. The benefits and costs of one method (Tele-Cardiology) are compared to the benefits and costs of another method (travel abroad). In previous research, adoption and diffusion decisions have been based on a decision matrix for comparing costs and benefits (Sisk and Sanders, 1998). The adoption decision is found to be largely a function of cost: if economic benefits (i.e. cost reduction) of TeleCardiology can defray the cost of physical travel, the adoption of the initiative would be mandated (Whitten et al., 2003; Malasanos, Burlingame and Youngblade, 2005; Kenedy, 2005; Taylor et al., 2003). To make the decisions, a number of benefits and outcomes must be considered such as benefits in terms of clinical (access to service, clinical efficiency, and outcomes), human and organizational, educational, administrative, technical and social (Ellis, 1999; Hjelm, 2005; Kumar, 2004). However, in most studies, clinical benefits and costs are the core indicators for innovators, earliest and early majority level of adopters of Tele-Medicine (Fig. 1). Further, value assessment criteria of technology adoption and implementation have been described by several groups such as the International Standard organization (ISO) and other agencies (GAO, 1997; Institute of Medicine, 1996; McDonald et al., 1997). Findings from these studies have been based upon quality of care, access, acceptability and cost, which interrelates with patients, professionals and providers as well as the total healthcare system (Bashshur, 1995). The evaluation of Tele-Cardiology compares the cost, quality, access and other consequences of delivering service as seen in Table 3. These are the most common methods used to assess healthcare (Bergmo, 2000; Crowe, 1984).
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Fig. 2 A Tele-Medicine adoption model
Culture
Adoption and Implementation of Telemedicine Initiative
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health view. This perspective addresses the burden of disease attributable to poor access to specialty cares. Further this perspective evaluates barriers to access that coincide with distance and mobility barriers; and identify groups that are most likely to benefit from specific Tele-Medicine services (AHRQ, 2001). In our study we attempt to capture cost will impact diffusion of TeleCardiology in Ethiopia, in comparison to other alternatives such as foreign travel for treatment. To do so, we adopted a questionnaire from Institution of Medicine (IOM, 1996) and the Agency for Healthcare Research and Quality (AHRQ, 2001). The adapted questionnaires were revisited so as to fit the Ethiopian context and ensure that the target population understood the questions. Hence, a review panel that consisted of two experts from ICT on health was set up to assess the validity of the questionnaires. Proposed revisions from the review panel were integrated into the survey instrument. We then conducted face-to-face interviews with chosen respondents, usually the top management and physicians. The method used was to book for an appointment of between 20–30 min. In practice most of the sessions lasted from 30 min to an hour, some lasted for more than an hour.
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providers to move toward desktop store-and-forward systems in many countries (Wooton, 2003). Tele-Cardiology services in most developing countries use asynchronous communication through the transfer of a still image or store-and-forward network, and suitable software and communication lines for transmission of still images from the local sites to the central Tele-Medicine-studio at the international health center. The transmitted images might be X-rays, electrocardiography (ECG) printouts, or images of skin lesions. Specialists at the international center make diagnoses based on still images and additional written information, work out treatment plans and, if necessary, recommend more diagnostic tests. A physician at the consultation center is then able to provide quality medical care with assistance from a senior expert at a specialty center (Rendina, 2000). With marginal requirements for additional investments in ICTs, Tele-Cardiology consultations may likely be the choice for improving cardiac healthcare in general. The most important improvement is expected to come from informed medical decisions about recommending patients to travel abroad when necessary. Because patient travel is usually expensive and inconvenient, avoiding unnecessary travel can save unnecessary costs. On the other hand, a decision to send patients abroad only when necessary and with the support of a specialist, can help contribute to better outcomes for healthcare providers as well as for patients. For a capital-starved nation such as Ethiopia, economic advantages, when available, would be the antecedent in choice of Tele-Medicine, contingent to socio-cultural factors (Fig. 2).
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Economic Benefits of Telemedicine
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3. Research method and data collection Our study began with a major review of existing literature on medical informatics. From our review of the literature, two major themes emerged to explain TeleMedicine diffusion in developing nations: Technological and NonTechnological. From the technological perspective, outlines a technology-based diffusion perspective that addresses acceptance measures; and causes for personal resistance. On the other hand the non-technological perspective on a public
4. Research methodology As mentioned in the previous section, we employed structured interview approach to capture the primary data used for this conceptual study. It is important to note here that we did not employ a case study approach that is usually intended to investigate “a contemporary phenomenon within its real-life context, especially when the boundaries between the phenomenon and context are not clearly evident” (Yin, 1994). Rather, we used the structured interviews to substantiate findings derived from the large base of secondary data used in the study. An overview of the secondary data sources follow:
r The data necessary for the study was obtained from institutions that may have direct correlation to the problem, such as the Ethiopian Ministry of Health, the Commercial Springer
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r In addition to these data sources, information was also obtained by searching on-line reference journals, reports, internet documents, conference reports and personal contacts.
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4.1. Analysis
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Tele-Cardiology activities are designed to be based on simple, low-cost technology: a PC, medical equipment, and an Internet-based communication network. Software requirements are application level with capabilities ranging from image acquisition and analysis to the collection, storage and transmission of images over existing communications network. The system would allow providers to capture, add text and send still or video images from one site to another using Transfer Control Protocol/Internet Protocol (TCP/IP). A typical Ethiopian Tele-Cardiology facility site has the following equipment: personal computers of various configurations, medical equipment, and computer software; the costs of which can be classified as either capital expenditure (fixed cost) or operational costs (variable cost) (Ohinmaa, Hailey and Roine, 1999; Grigsby et al., 1995; Della Mea, Cortolezzis and Beltrami, 2000). For the present analysis, seven-year and ten-year lifetimes were assumed for the computer and medical equipment. The annual maintenance cost was assumed to be 4% of the book value in accordance with the existing regulations for fixed assets in the public health service in Ethiopia (MOF, 2002). The bank interest was 5% of the total investment cost based on the Ethiopian investment rule for health. The startup and training cost was evenly divided between seven and ten years respectively (See Annex I and III for detail) (Jennett et al., 2003; CCOHTA, 2003; Darkins et al., 1996). Annual variable costs included cost of the services for the consultations either locally or internationally. Call costs for communication line transmission and long distance telephone calls were also included in the variable costs, in addition to costs related to the particular tele-consultation (ECG-paper, etc). The difference in cost between certain types of still images depends on the costs of the pre-requisite materials and the number of working-hours that nurses and lab assistants spend on the preparation and transmission of the still images. The hourly cost of a consultant was four hours a day, twenty days a month, and twelve months a year (See Annex III and V for detail). In order to comparatively assess Tele-Cardiology versus physical cardiac care, we also considered the costs of the latter. Expenses incurred by patients who travel abroad for treatment can also be classified in terms of fixed and variable costs. The patients’ cost, which is directly related to the treatment such as transportation, medical treatments and other
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Bank of Ethiopia, the Ethiopian Telecommunication Authority, and Tikur Anbassa Teaching Hospital Doctors. A number of websites for Ethiopian and international institutions involved in these efforts were investigated together with other websites focusing on Tele-Medicine, telehealth, e-health, ICT and online health improvement. Data for evaluation of Tele-Cardiology initiatives in Ethiopia was obtained by using multiple methods, including interviews, and documents. The multi-method approach enabled the triangulation of data from interviews and observations with documentary evidence (Brewer and Hunter, 1999). The sources of the data will be discussed below in detail. Primary data was collected from interviews addressing the areas of quality of care, access to care, costs, patient and clinician perceptions, telecommunication, and reimbursement for Tele-Medicine services. These semi-structured interviews explored the individual perceptions of Tele-Medicine and its impact on healthcare. The questions were opened-ended and semi-structured (Where mostly referred and adopted from IOM, 1996; AHRQ, 2001). Faceto-face interviews were carried out using the questionnaire as an interview instrument. The persons who where involved in these interviews were government, international organization, private sector, and university staff (these experts are listed in Annex V). Informal discussions were also conducted with some patients who have traveled abroad for treatment and doctors who have experience in the subject. Secondary archival data were collected from several sources: records of patients with heart-related diagnoses that traveled abroad between June 2001 and June 2002 were collected from the Ministry of Health in Ethiopia; the annual report of the Commercial Bank of Ethiopia (CBE), which is the authority that permits the exchange of foreign currency for patients and accompanying persons after they receive an approval letter from the Ministry of Health to go abroad; and Children’s Heart Fund of Ethiopia (CHEF), which has supported the treatment abroad of more than 500 patients over the past ten years. Financial data were obtained from a few other sources: the fixed and variable costs for Tele-Cardiology where mostly referred from (Technology Guidelines, 2003; Internet Based Medical Devices); wages for personnel at domestic Tele-Cardiology centers were derived from salary scales of private health service providers and NGOs (Ministry of Labor document); other expenses such as rent, electricity, telephone and utilities were derived from Ethiopian Electricity Power Authority and Ethiopian Telecommunication Cooperation); international consultation fees were obtained from existing service providers; and finally, the financial rules and regulations concerning depreciation and interest rates for investment in the health sector were obtained from the Ethiopian Ministry of Finance documents.
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The Break-even Value :
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Tt = (N ×Vt ) + Ct Aa = (N × Va ) + Ca N = (Ca − Ct )/(Vt − Va )
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where: T, Total annual cost of Tele-Cardiology; A, Annual costs of the alternative method (Travel Abroad); N, The number of patients; V, Variable cost; C, Fixed costs; a, Travel abroad; t, Tele-Cardiology
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6. Issues concerning the tele-medicine Capital, especially in terms of foreign reserves, is a scarce resource in developing countries. Given the economic incentives, the Ethiopian government has shown its readiness to consider the development of ICT policies and
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The annual costs of Tele-Cardiology and alternative methods of treatment are shown in Table 4. The estimated annual Table 4 Financial results in US$
costs of running a Tele-Cardiology unit would be $114,000, assuming ten-year equipment lifetimes and that 50% of the patients are treated via Tele-Cardiology. For the sensitivity analysis, seven-year lifetimes were used and the annual costs amounted to $108,183. Total cost variation for Tele-Cardiology and its counterpart with the number of patients are shown in Figs. 3 and 4. Figure 3 indicates significant reduction in total cost with the number of patients increasing. Figure 4 should show the opposite. Figures 3 and 4 superposed shows an intersection, the number of patients that will undergo Tele-Cardiology break-even. Fig. 5 shows the cost of break-even lines i.e. the horizontal axes show the annual workload; the vertical axes the costs in US dollars; the solid lines show the costs of TeleCardiology and travel abroad; and the intersection indicates the critical mass (43) of cardiac cases needed to break-even (see in Fig. 5).
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Fig. 3 Tele-Cardiology vs the number of patients
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related expenses, is assumed as fixed cost. For the present analysis, airfare was $1,000. The medical treatment cost was calculated based on the foreign exchange department of the government of Ethiopia, which allowed for medical treatment (a maximum of $10,000). The other cost is also based on the same principle of travel entitlement that is a maximum of $1,500 (for detail see Annex II and IV). The variable cost includes the expense of the accompanying person (transport and daily expenditure), patients’ before treatment cost (sending document, contact establishment, etc) and other expenses (visa, local transport etc.). In this study, focus remains on those patients that followed the official procedure approved by Medical Boards of Ethiopia only. Next, the comparison will focus on the basis of service improvement and cost between the alternative approaches; finally, a case is made between traveling abroad for treatment versus implementing Tele-Cardiology. In doing so, we employ economic cost comparisons by calculating total costs and a break-even analysis (Field, 1996, Finish office Health care Technology Assessment, 1997; Sorensen, Rundhovde and Kozlov, 1999).
Cost in US$ Description 1. Annual cost of Tele-Cardiology equipment lifetime 2. Annual cost of travel abroad
3. Financial savings assuming equipment lifetime
7 Years 10 Years 25% 50% 75% 100% 7 Years 50% 75% 10 Years 50% 75%
Fixed
Variable
Total
127,057 121,680 189,000 283,500 425,250 567,000
130,760 130,760 55,000 82,500 123,750 165,000
257,817 252,440 244,000 366,000 549,000 732,000 108,183 291,183 114,000 297,000
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Fig. 4 Travel abroad vs the number of patients
policies and strategies that facilitate the harnessing of new ICTs for healthcare development. Where policies have been formulated, proper implementation plans are needed. Review strategies are also lacking. However, newer policy directions for SSA such as NEPAD (New Partnership for Africa’s Development) are bringing together a peer-review mechanism for governance and policy initiatives for the continent. Still, regulations remain rigid and ICT tariffs remain high, compounded by the lack of political good will. A lack of support staff has been a major impediment in developing human resources for Tele-Cardiology and ICTs. Most staff managing ICT-based projects lack adequate training that would enable them to effectively exploit both existing
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programs of action that address healthcare challenges. At the core of the issue is the need to harness ICTs in the health sector through the building of necessary capacity in deployment of the ICT infrastructure as well as human resource development and strengthening of institutions. Notwithstanding economic benefits, the other factors have proved to be constraining in Tele-cardiology adoption and implementation. In most developing countries, especially in Africa, the formulation and implementation of policies in the ICT sectors are still rudimentary and call for an integrated set of laws, regulations and guidelines that shape the generation, and acquisition and utilization of ICTs. Most countries lack
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Fig. 5 Break-even vs the number of patients
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Table 5 Break-even points by cost and equipment lifetime
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Cost type
Per head fixed cost (TC) Per head variable cost (TC) Per head cost of (TC) Total fixed cost (TA) Total variable cost (TA) Total cost of (TA)
Annual cost of tele-cardiology assuming equipment life time of 7 Years/No. patients 10 years/No. patients 75
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120
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1743.47 1694.10 3437.56 103125 354375 457500
1452.88 1411.75 2864.35 123750 425250 549000
1245.33 1210.06 2455.40 144375 496125 640500
1089.66 1058.88 2148.00 165000 567000 732000
1743.47 1622.40 3365.86 103125 354375 457500
1452.88 1352.00 2804.90 123750 425250 549000
1245.33 1158.86 2404.20 144375 496125 640500
1089.66 1014.00 2103.66 165000 567000 732000
TC = Tele-Cardiology cost TA = Travel Abroad
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technology that can allow resurgence in healthcare among the population, both displaced and remote.
7. Discussion and implications
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While there are significant potential advantages and benefits from Tele-Medicine, the evidence of its cost-effectiveness and sustainability is short. According to Wright (1997) the main reason for this is related with the fact that much of the Tele-Medicine activity has been developed in the form of pilot projects in universities and hospitals with subsidized funding from government or other sources. Nevertheless, funders and policy makers are deeply concerned about evaluating the economic viability of Tele-Medicine . However, evaluation of cost-comparison of TeleCardiology to its counterpart depends on several factors. The most important factor, however, is the number of patients (Lobley, 1997; Sicotte et al., 2004). In addition, equipment prices, technical infrastructure, interoperability, policies, integration into existing health service and recognition of the service by patients and health service providers also play a role. Furthermore, the evaluation is also dependent on the estimation method used, the characteristics of the technology under assessment, the particularities of the data sources, applicability of the system, applications, and organization and social values where and when the evaluations take place (Mcintosh and Cairns, 1997; Ohinmaa, Hailey and Roine, 1999). This can play an important role in determining the unanticipated consequences of adopting the technology at organizational or national levels. Moreover, the distinction between variable and fixed costs is apparent in its relationship to the item or activity being provided. The variable costs change in direct proportion to changes in number of patients, while the fixed cost do not change regardless of change in number of patients served (Doolittle et al., 2004) The cost-to-volume relation is presented using both tables and graphs, which are both simple and effective when illustrating the cost development and how the total costs depend on the annual workload. Future evaluations of Tele-Medicine solutions should encompass a broader scope. In this study, the cost comparison analysis did not consider the scope of Tele-Medicine use beyond cardiac care. Yet, the positive spillover benefits are noteworthy. The availability of a Tele-Medicine infrastructure could possibly be used for other Tele-Medicine solutions and even Tele-Education. While one of the fundamental questions surrounds the improvement of healthcare service, it would be a prudent step to examine the opportunity cost of Tele-Medicine in developing countries, in view of its growing scope and diverse contingencies.
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and new technologies. There is a need to invest in training and advisory services. Such training could be done through conferences, workshops or training of trainers’ courses. Introductory and sensitizing workshops could be organized for different categories of users and local experts could provide ongoing on-line support. One of the doctors we interviewed stressed the critical role of appropriately trained human resources at all levels to help achieve the goals of Tele-Medicine and the complexity of issues pertaining to training, retention and utilization of trained human resources. He further emphasized the need to strengthen the personnel . . . using Tele-Medicine for continuing education, distance education; practice based learning, case conferences, consultation . . . Finally, culture and language carve out the final contingency. In combination, these two issues could possibly be the most important and basic constraint that poorer countries face in ICT development (Prednia et al., 1998). A diverse tribal orientation, mainly represented by more than 80 ethnic groups have laid claim to the land, throwing Ethiopia into more than 25 years of conflict. Illiteracy is rampant, and nepotism has become a pre-condition for success. Prevalence of ethnic culture has also created strict rules, binding communities to particular regions and embedding them to rigid social and political strata. As a result, mobility is low among the population already displaced by conflicting and capricious politics. Furthermore, gender inequality is a barrier to the elimination of differentials in health status. In Ethiopia, women cannot independently decide to seek healthcare; a spouse, or a senior member of the family makes that decision. These norms usually favor males and deny women their basic rights to healthcare. For example, after a woman is examined/diagnosed, the doctor may not inform her of the outcome, but would rather tell her husband. Moreover, Ethiopia is a patriarchal society where women are discriminated against at all levels. Such discrimination is reinforced by various institutions—religious, economic, political and social— all of which emphasize women’s inferior position in the society. Also, women traditionally have held a lower socioeconomic status and have been positioned to be dependent on men. One explanation for poor health outcomes among women is related to the non-use of modern healthcare services by a sizeable proportion of Ethiopian women. Health centers are usually too far away and women do not have the necessary resources to afford healthcare, even if it was widely available to them. Oftentimes, problems related to women’s economic situation, social behavior and especially healthcare, are largely treated outside the sphere of modern medicine. As a result, for many diseases, women in particular prefer to visit “holy waters” or traditional healers, sometimes leading to fatal outcomes. This socio-cultural rigidity has been a primary impediment to an economically viable
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8. Conclusion
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In summary, Ethiopia is in great need of adequate healthcare services. Health indicators in Ethiopia remain extremely low, even by Sub-Saharan African standards. The economic condition of the country is one of the main obstacles prohibiting health insurance and medical care from the government. Tele-Cardiology is not only necessary for financial reasons but also for the knowledge and experience of the people and the very large number of problems and inconveniences associated with medical treatment of patients. On the basis of the results and the existence of an acute problem in health services, healthcare warrants the application of Tele-Cardiology and the establishment of TeleMedicine centers. However, Tele-Cardiology cannot by itself be a remedy for all, but it supplements traveling abroad for special cases that need a specialist and equipment. We believe that presently Tele-Cardiology in developing countries is only for second opinion and is not a means of performing surgeries, due to lack of infrastructure. Furthermore, based on existing data, the introduction of Tele-Cardiology encouraged its usage by new patients who could not otherwise afford to travel abroad, and therefore making healthcare more viable and cost effective. Finally, with all the challenges at hand, including the marginal economic situation of the applications, TeleCardiology seems to provide an improvement for the health Springer
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sector in Ethiopia. There is a need for further research that focuses not just on cost and technical issues but also on the social, organizational and policies dimensions (Mbarika et al., 2005). Tanriverdi (1999) noted, “Lack of learning or knowledge in one or more of the (technical, economic, organizational, and behavioral) areas inhibit the appreciation of the value of the application, and hence, constitute knowledge barriers to diffuse. Further, government policies and interventions play an important role in the diffusion of Tele-Medicine, specifically for those network technologies that requires large-scale network services and infrastructures to be in place before any provision of services can take place.
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Annex I. Cost of the tele-cardiology services
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1. Fixed costs (Ct) Equipment Depreciation Cost Maintenances Cost Bank Interest Cost Start Up and Consultation
Employee’s Wages at Local Hospital Telecommunication Lines Annual Rent Operational Costs
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Implications of this study are varied. While the practice of Tele-Medicine is still at its early stages in Ethiopia, there exist several current and potential research and practical implications associated with its growth within the country. In the preceding section, several factors that could influence the diffusion of Tele-Medicine in Ethiopia were discussed. Researchers can conduct idiographic studies so as to gain further insights on contingent factors that could influence ICT-related Tele-Medicine initiatives within the Ethiopian context. This can be done using longitudinal multimethod case study analysis of single projects or cross comparisons of multiple projects within the country. Findings from such research could eventually be carried over to other developing countries, with similar contingencies. This study also has important implications for practice and could provide some prescriptive directions for policymakers in the Ethiopian government. This could be helpful as the government develops national ICT policies that are specific to Tele-Medicine diffusion. Besides implications for the government, multinational companies, involved in TeleMedicine and other ICT projects could gain a better understanding of the current status of Tele-Medicine in Ethiopia. This is important as they make major decisions about investing in the region.
2. Variable costs (Vt.) Hourly Fee of Consultant Hourly Fee of Doctors Involved in TM Internet Provider Charge Telephone Charge Supplies for ECG Technicians Annual Wages Supplies for Functional Nurses Annual Wages
7% of purchasing prices 4% of book value 5% of the total investment Project before start up consultant and training of Staff Doctors, Nurses, Technician, Tele-Cardiology consultant Dedicated line Cost Administrative and other costs to run the TM center International consultant fee per hour At local Tele-Medicine Center Monthly Monthly
At local Tele-Medicine Center At local Tele-Medicine Center
Annex II. Cost of the travel abroad—alternative services 1. Fixed costs (Ca) Transportation cost of patients (AIR) Medical treatment cost Other cost 2. Variable costs (Va.) Accompanying person travel cost Cost of daily expense accompany person Cost of before treatment (Sending documents, establish contacts, company service charge, etc) Other (Visa, and other related cost)
4,500
2,000
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Annex III. Hardware, software personnel and other–US$ 37,500 37,500 165,000 732,000
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40 60 90 120
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Number of patients
COST in US$
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40∗ 6100 = 244,000 60∗ 6100 = 366,000 90∗ 6100 = 549,000 120∗ 6100 = 732,000
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12,000 20,000 20,000 52,000 1,000 2,000 1,000 1,000 5,000
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Total cost
120
3000.00
360,000
30 30 30 30 120 120
1,500 1,200 1,200 1,000
45,000 36,000 36,000 30,000 147,000 60,000
500
567,000
1,200
Government offices Ato Bekele G/Medihn Prime Minister office Prime Adviser (ICT) Sister Sosna Ministry of Health (National Tele-Medicine Representative) Ato Tesfaye Biru Ethiopian Telecommunication Cooperation – G. Manager Addis Ababa university Dr. Legesse Zerhun Dean of Medical faculty of AAU (National Tele-Medicine Representative) Dr. Danel Zewdnech Head of Radiology Dept. Faculty of Medicine (National Tele-Medicine Representative) Dr. Miliard Derebaw Faculty of Medicine, Surgery (Heart) DR. Mengistu Alemayehu Medical Intensive Care Unit Staff International organization Mr. Brahima Sanou International Telecommunication Unit Head of the ITU Regional Office for Africa Liaison Officer to AU and ECA ATO Tilahun Kebede International Telecommunication Unit Senior Advisor for East Africa (BDT) (Tele-Medicine project) Dr. Alexander Correia World Health Organization Head, WHO officer for AU and ECA Ato Sirak G/Yohannes UNDP/Ethiopia Country Program Assistance Program Officer Private hospital Dr. Elehu Feleke Specialist in Internal Med and Cardiology International Cardiovascular Medical Center (ICMC) Dr. Ermias Mulugeta General Manager of Bethzatha Health Services
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36,000 36,000 12,000 84,000
Unit cost
75
500 500
Annex V. Summary of organization and individual interviewed 5 10 3
No. of person
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Patient Other Expenses (average 10 days∗ ) Sub Total of Patient Expense Accompaning Person Accompanying person Cost Travel Cost
75 75
Number of Tele-Cardiology Consultation and travel abroad patients Average Cost of Treatments = (732,000/120 = 6,100 US$) Number of Patient that Tele-Cardiology Consultation done for = 40, 60, 90 120 Number of Patient Travel Abroad = 120.
25,000 20,000 45,000
Annex IV. Cost of travel abroad in the year—in US Dollars
Patient Patients treatment cost (not include Surgery) Patient travel cost USA Europe South Africa Israel
Daily Expense (10 days) Other Cost Sub Total of Accompanying Person Expense Grand total
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10 3 1 1 2 10 2 10 10
USD ($) 10,000 2,000 1,000 1,000 500 13,000 30,000 10,000 3,000 70,500 9,870 2,820 3,525 705 16,920
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1. Hardware Computers Printers Digitizers Scanners Communication Equipment Network and Data Communication Equipment ECG and Other Accessories Backup Equipment Office Equipment Sub Total Depreciation Cost 14% Technical Maintenance Cost 4% Interest Cost 5% Insurance Cost 1% Sub Total 2. Software Operating System and Application Software Tele-Cardiology Process Software Sub Total 3. Personnel–Annual Salary Medical Doctors (600/Month) Nurses (300/ Month) Technicians (350/Month) Sub Total 4. Other Housing and Other Utilities Expense Telecommunication Provider Cost Overhead and Administration Expense Sub Total 5. Startup Equipment Installation Network Installation Training Consultation
90,000
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Mengistu Kifle is a Ph.D. candidate at University of Stockholm/KTH DSV. He holds MSc. in Computer Science. His research interest includes telemedicine and healthcare informatics in developing countries with a focus on sub-Saharan Africa. His work has appeared (or forthcoming) in the form of book chapter, journals and international conference publications.
Victor W. A. Mbarika received his Bachelor of Science in Management Information Science (MIS) in 1995 from United States International University, Nairobi and San Diego, CA, Masters in MIS from University of Illinois at Chicago, IL in 1997, and PHD in MIS from Auburn University, Auburn, AL in 2000. Dr. Victor W. A. Mbarika is on faculty in the College of Business at Southern University and A&M College. His research in Multimedia Learning and Telecommunications Diffusion in Developing Countries has been published (or are forthcoming) in 29 academic journals, four book chapters, and over 45 national and international conferences publications on Information Systems. Dr. Mbarika is Founder and President of Cameroon Computer and Network Center (CCNC). He has received several instructional and research awards and has published two academic books. (Website: http://www.mbarika.com.) Dr. Pratim Datta is an Assistant Professor of Information Systems at Washington State University. His research interests include IT infrastructure design and productivity, Virtual reality, Knowledge Management, and Global IT. He has published in AIS and ACM journals and international conferences such as the International Conference on Information Systems (ICIS) and the Hawaii International Conference on Systems Sciences (HICSS).
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