Factors Affecting the Adoption of Telemedicine& ... - Springer Link

P1: KEE Journal of Medical Systems [joms]

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Style file version June 5th, 2002

C 2004) Journal of Medical Systems, Vol. 28, No. 6, December 2004 (

Factors Affecting the Adoption of Telemedicine—A Multiple Adopter Perspective Nir Menachemi,1 Darrell E. Burke,2,4 and Douglas J. Ayers3

This paper utilizes the diffusion of innovation framework to discuss factors affecting adoption of telemedicine. Empirical and anecdotal findings are organized across five attributes affecting innovation adoption rates for the following four adopter groups: physicians, patients, hospital administrators, and payers. A discussion of the implications is included. KEY WORDS: information technology; diffusion of innovation; outcomes.

INTRODUCTION This paper utilizes the diffusion of innovation framework to outline the factors that impact the adoption of telemedicine. Broadly defined, telemedicine involves the utilization of communication technologies to deliver or support any aspect associated with medical care, regardless of physical distances separating patient and provider. Telemedicine has been used, both, as means of providing a direct services to patients, and as a medium for collaborative efforts among physicians. Medical specialties that have successfully used telemedicine include, but are not limited to, psychiatry, radiology, pathology, dermatology, cardiology, surgery, ophthalmology, and dentistry. A primary benefit of telemedicine is the removal of geographical distance as a barrier to quality, effective healthcare. This broad group of technologies holds great promise in expanding the availability of healthcare, particularly to medical shortage areas. For example, telemedicine has been used to coordinate and supplement the scarce availability of medical resources in rural areas. Telemedicine has been shown to reduce transportation time and cost burdens associated with providing medical services in both correctional facilities as well as in home healthcare settings. Additionally, researchers have benefited 1 College

of Medicine, Florida State University, Tallahassee, Florida. of Information Studies, Florida State University, Tallahassee, Florida 32306-2100. 3 School of Business, Department of Management, Marketing and ID, University of Alabama at Birmingham, Birmingham, Alabama. 4 To whom correspondence should be addressed; e-mail: [email protected]. 2 School

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Menachemi, Burke, and Ayers

from the use of such technologies through the sharing of clinical data and diagnostic images. Finally, telemedicine has also been credited with making continuing medical education possible for remotely located physicians and medical residents. While the promise of telemedicine is great, its adoption by the medical community has not been as rapid as expected.(1) Despite healthcare providers’ use of telemedicine is still growing, the rate of growth is slowing. The use of telemedicine in physician’s practices has doubled in every year since 1993 but its growth slowed to about 20% in the late 1990s.(2) However, recent changes in reimbursement policies, suggest that this trend may change.(3) The decision of whether or not to adopt a form of telemedicine, by an organization, is multifaceted in that various stakeholders exist. As such, it is important to consider the viewpoints of key “adopters” both collectively as well as individually. This work addresses four key adopter groups for telemedicine: physicians, hospital administrators, patients, and healthcare payers. Physicians are generally considered the end users of telemedicine and thus, they can heavily influence adoption rates. Healthcare administrators, charged with the allocation of hospital resources, exert influence as well. For many telemedicine applications, patients are the customers making their perceptions and satisfaction an important consideration on hospital decisions. Finally, healthcare payers (i.e., insurance companies, HMOs, Medicare, Medicaid, etc.) have historically influenced adoption of innovation in U.S. healthcare settings. Payers represent a distinct type of adopter. Adoption, or in this case reimbursement of telemedicine use, by payers serves to positively or negatively influence the adoption of telemedicine by the other three adopter groups. The diffusion of medical technologies has been investigated, as has the diffusion of information technology in healthcare settings.(4,5) Both are relevant to adoption of telemedicine since it is essentially a medical application of information and communication technologies. However, these studies are characterized by considerable diversity in the diffusion factors under investigation. Therefore, a key contribution of our work is the use of a broader diffusion of innovation framework to organize past findings and to create propositions regarding key facilitators and barriers to adoption of telemedicine. Additionally, our work extends previous studies investigating diffusion of healthcare related technologies by explicitly applying the diffusion framework to four key adopter audiences. Inclusion of these key adopter groups is critical since resistance in any of these groups could significantly slow the overall adoption rate. Finally, the framework utilizes diffusion influencers that are communications-related.(6) As a result, the discussion lends itself to the development of recommendations and implications of interest to healthcare managers and practitioners. Beginning with a definition of telemedicine, this paper includes an overview of the diffusion of innovation framework, a detailed application of the diffusion of innovation framework to each of the key adopter groups based on past empirical research and anecdotal examples, and a discussion of implications. DEFINING TELEMEDICINE Definitions for telemedicine are as plentiful as are the actual applications of this technology (see Table I). Most definitions focus on the use of communication


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Table I. Various Definitions of Telemedicine Source

Definition of telemedicine

Institute of Medicine Strode et al.(7) Austin and Boxerman(8) Burns(9)

Whitlock et al.(10) Chepesiuk(11)

Telemedicine is the use of electronic information and communications technologies to provide and support healthcare when distance separates the participants The delivery of healthcare over a distance using telecommunications systems Telemedicine is the application of computer and communications technologies to support healthcare provided to patients at remote locations The use of medical information exchanged form one site to another via electronic communications for the health and education of the patient or healthcare provider and for the purpose of improving patient care The extension of health services over time and distance using computer and telecommunication technologies to expand access, improve quality, and control cost Medicine from a distance

or information technologies to deliver care from afar. While the use of such systems is obviously associated with telemedicine, it is not its main ingredient. Telemedicine is greater than the sum of its parts and focuses on the patient. It effectively pushes the doors of medicine outward, to where the patient is, in an effort to expand access, control costs, improve diagnostic quality, or all three. As stated above, telemedicine involves the utilization of communication technologies to deliver or support any aspect associated with medical care, regardless of physical distances separating patient and provider. Telemedicine has been used, both, as means of providing a direct services to patients, and as a medium for collaborative efforts among physicians. A majority of telemedicine applications utilize one of two communication styles, either synchronous (live and interactive) or asynchronous (store and forward). The former generally includes videoconference-based clinical consultations while the latter involves the storing of digital images or files for retrieval by others at a later date or time. Store and forward methods are typically associated with medical specialties that already rely on the use of images for diagnosis.

DIFFUSION OF INNOVATION THEORY Diffusion of innovation theory(6) provides an appropriate framework to understand the adoption of telemedicine. Telemedicine fits the definition of an innovation which is defined as an idea, practice, or object that is perceived as new by the unit of adoption.(12) Although one could argue that the use of the telephone in the early 1900s initiated telemedicine, only recently has technology evolved to such an extent for telemedicine to support for a broad range of medical services. Everett Rogers first set forward his theory of innovation diffusion in 1962. He argues that diffusion is the process through which an innovation is communicated over time among members of a social system. Innovation adoption is the process through which a decision-making unit passes from first knowledge of an innovation


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to the ultimate implementation of the innovation. As described earlier, the decisionmaking units of interest in this paper are physicians, administrators, patients, and healthcare payers. Moreover, the theory outlines five attributes of innovations that influence the rate of adoption for innovations. It is important to stress that the focus is on decision makers’ perceptions of these attributes. Accordingly, these attributes are discussed from the decision makers’ perspective. The five attributes are 1) relative advantage, 2) compatibility, 3) trialability, 4) observability, and 5) complexity. A brief description of the five attributes, which are posited to impact the rate of adoption of innovations, follows. Relative advantage is the degree to which an innovation is perceived as being better than the idea(s) that it supersedes. Such advantages encompass economic advantages. In addition to economic aspects, relative advantages can also include, but are not limited to, increases in comfort and market share, savings in time and/or effort, social or other status, etc. So long as the decision maker perceives that the innovation is better (in some way) than their existing options, the likelihood of adopting said innovation increases. Compatibility is the degree to which an innovation is perceived as consistent with decision makers’ existing values, past experiences, and needs of potential adopters, a measure of overall fit. Essentially, the more compatible the innovation, the less uncertain it is to the decision maker. As stated above, compatibility can occur on several dimensions. An innovation can be compatible with a decision makers’ value system. For example, if patients believe that quality medical care only occurs when the attending healthcare provider is physically present, then telemedicine techniques will not be considered as compatible with those patients’ belief systems. Compatibility can also be linked to the decision makers’ previous experiences. Thus, physicians that are accustomed to using teleconferencing equipment may find telemedicine more compatible with their prior experiences. Finally, compatibility also addresses the fit between the key needs of the decision-making units and the needs addressed by the innovation. For example, if administrators are very concerned with cost reduction in healthcare settings and telemedicine presents a viable option to reduce costs, then those administrators would consider the innovation as more compatible with their needs. Trialability is the degree to which an innovation may be tried on a limited basis. Trialability is more important in the early stages of adoption. Later adopters of innovations are less concerned with trialability since early adopters have essentially created a “vicarious trial” for the late adopters. Essentially, if decision makers can experiment with the innovation without making a full commitment, uncertainty is reduced and accordingly, the likelihood of adoption increases. Observability is the degree to which the benefits of the innovation are visible to decision makers. The more clearly decision makers can see and/or understand the innovation; the more likely they are to adopt the innovation. A different way of looking at this variable is to think of it as the ease with which the decision maker can observe the relative advantage(s) of the innovation. The last attribute, complexity, is the degree to which an innovation is perceived as relatively difficult to understand and/or use. Diffusion of innovation theory envisions


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innovations on a continuum ranging from simple to understand and/or use to complex to understand and/or use. For example, if a telemedicine application required patients to operate equipment that required extensive training, it could be considered more complex. As an innovation’s complexity increases, the likelihood of adoption decreases. Applying Diffusion Theory to Key Adopters of Telemedicine In this section, the authors organize current empirical and anecdotal findings regarding telemedicine and its applications across the five adoption attributes. Within each of the adoption attribute discussions, the authors delineate how those attributes apply to the different adopters of interest. As described earlier in this paper, payers represent a special type of adopter for telemedicine. Accordingly, the discussion with regard to payers is extended. It should also be noted that there is a lack of evidence for some of the attribute—adopter groupings. For example, while it is likely that the trialability (adoption attribute) of telemedicine for patients (adopter) will determine how readily patients will embrace telemedicine, the authors did not find studies directly related to this grouping. Indeed, these gaps present areas for future research. Table II summarizes the key findings of this section. Relative Advantage Physicians For physicians, telemedicine represents many significant advantages over more traditional forms of interaction with patients and other healthcare providers. Telemedicine has proven capable of producing improved outcomes. Researchers have found that doctors using this technology can get the right treatment to their patients sooner than otherwise.(13) Increases in quality of care have also been reported.(14) In particular, physicians treating home health patients have especially benefited from the ability to deliver higher quality care.(2) A second advantage focuses on increases in efficiency. Because healthcare providers can consult with patients at remote sites, savings in travel time and costs are a key benefit. Reduced travel time makes seeing a larger daily patient load feasible while achieving a cost savings.(2) Triaging patients to the most efficient and cost effective care is also a relative advantage. A third benefit of telemedicine results from its ability to increase collaboration between healthcare providers. Remotely located doctors, using telemedicine, are able to consult more easily with their specialist colleagues. For example, a rural practitioner had to continuously treat a patient’s skin condition for 3 years before telemedicine afforded him the opportunity to consult with an urban located dermatologist. That brief interaction, involving the transmission of photographs and other clinical information, resulted in a permanent recovery for the patient.(15) Other evidence supports that telemedicine has successfully decreased provider isolation.(9) A fourth benefit, identified in a recent Canadian study, suggests that telemedicine adoption is perceived by adopting physicians to satisfy both professional and social

Patients • Increase access to services for remotely located patients • Convenience of staying home • Travel costs savings • Increases in case turnaround results in increased satisfaction Relative Disadvantages • Perceived vulnerability in security, confidentiality, and privacy

• Most telemedicine technologies (designed for patient use) utilize existing (familiar) computing and telecommunication infrastructures

Physicians • Telemedicine can produce improved outcomes especially expedited and increased quality of care • Increases in efficiency include less travel time, increase in patient loads, and more efficient triaging of patients • Increase collaboration among physicians, improve skills, and reduce provider isolation • Telemedicine can provide the volume and diversity needed to justify Graduate Medical Education (GME) programs • Changing trend towards reimbursement of the technology Relative Disadvantages • Licensing requirements prevent doctors from practicing telemedicine across state lines • Changes existing referral and territorial patterns. Rural physicians may fear losing business to urban specialists • Physicians may doubt the technology’s effectiveness • Studies find that telemedicine can be as reliable as traditional practices • Increased use of computers and IT by physicians makes accepting telemedicine technology easier

Relative Advantage

Compatibility

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• The importance of having a unified, understood, and agreed to vision as to the management and use of telemedicine initiative. If initiative does not fit within the strategic plan and mission, less of a chance of success

• Cost savings and efficient allocation of resources can be achieved • Increase in provider caseload and decrease in average length of visit • Synergistic effect on quality of care and cost savings when coupled with existing IT capabilities • Ability to refer patients, share resources and equipment with remote sites, reduces duplicate expenditures and out-of-network referrals • When considering variable costs, telemedicine can frequently generate profits • Foster an impression of technological leadership Relative Disadvantage • Need to comply with strict federal (HIPAA) and accreditation (JCAHO) standards

Administrators

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Adoption factors

Table II. Diffusion Theory Applied to Telemedicine Adopters

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• Few people know what telemedicine is. Those who implement this technology must publicize that they do

Negative Compatibility

• Increases in computing power at lower prices coupled with increasing availability of broadband Internet connections and free software can promote the use occasional use by private physicians

• Specialties that rely on the use of images for diagnosis (i.e., radiology ophthalmology, pathology) experience greater ease in observing and describing telemedicine benefits • While equipment tends to work as specified, many physicians find the system to be complex and sophisticated to use regularly • Onerous ongoing training (both technical and nontechnical) of physicians is needed

Observability

Complexity

Patients Negative Compatibility • May not feel comfortable with new technology and with being diagnosed by a doctor hundreds of miles away

Physicians Negative Compatibility • Some physicians find technology discomforting and are slow to adopt because incapable or unwilling to commit time to alter practice patterns • Lack of proper and ongoing training found to impede telemedicine use

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• Lack of clear guidelines and regulations governing telemedicine creates considerable complexity • Requires flexibility and creativity to respond to legal, technical, and political issues/challenges

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• Benefits, particularly financial, may not be readily apparent to administrators

• High telecommunication costs can be mitigated by utilizing infrastructure for other uses (i.e., health education, administration, and other nonclinical uses)

• Funding for a program initially provided by a grant can effectively provide for trial basis use • Leasing is associated with higher successful telemedicine adoption rates

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Trialability

Adoption factors

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responsibility components of their practice.(16) Thus, telemedicine advantages for physician go beyond just the clinical aspects. Telemedicine can also provide the volume and diversity needed to justify Graduate Medical Education (GME) programs. Having remote access to other academic hospitals’ grand rounds expands residents’ exposure to medical cases.(9) Doctors are also able to “tune-in” to continuing education programs already being offered by various organizations including the Centers of Disease Control and Prevention. Finally and perhaps most importantly, physicians approve of the use of telemedicine. Overall, physicians report high satisfaction ratings with the use of telemedicine and they frequently note the higher than expected quality of image transmissions.(17) Radiologists report, that the ability to zoom-in on digital x-rays compensates for the occasional lower resolution experienced.(18) Despite these perceived advantages of telemedicine, lack of adequate reimbursement impedes the adoption of telemedicine.(7) In fact, experts believe that the success of telemedicine is dependent on reimbursement more than any other issue.(19) For example, one of the largest single payers in the United States, Medicare, previously stated that provision of home healthcare through telemedicine is significantly less expensive than personal physician visits. A physician can make five home visits per day while many more can be visited per day via telemedicine. Medicare argued that to reimburse for such telemedicine consultations would overpay the physicians who provide them. Likewise, the Centers for Medicare and Medicaid Services (CMS) initially ruled that nonradiology store-and-forward consults were not reimbursable.(9,13) CMS initially approved reimbursement occurring only under very limited circumstances.(20) However, recent CMS policy changes have broadened the allowance of reimbursement for telemedicine services for Medicare patients.(21) Similarly, 18 state managed Medicaid programs are currently reimbursing physicians for telemedicine services.(22) Moreover, 17 of the 18 states provide the same reimbursement as the reimbursement for covered services furnished in the conventional, face-to-face manner.(23) Private insurers are also beginning to reimburse telemedicine services. Thus, recent payer acceptance of telemedicine services will increase the likelihood of physician adoption. One continuing disadvantage relates to licensing. These issues are believed to negatively influence physicians. Currently, most state regulations require that consulting physicians have a practicing license in the patient’s state.(24) Since, medical licensure is granted at the state level, this poses a problem for physicians using telemedicine across state lines.(13) Telemedicine raises considerable malpractice and liability issues as well. Consultations across state borders, from one doctor to another, can become a legal liability as well. This is because when consultants generally give advice, it is without patient responsibility.(9) Telemedicine also changes existing referral and territorial patterns. Rural physicians may fear losing business to urban specialists.(13) Finally, some physicians may doubt the technology’s effectiveness.(13) Concerns over the “quality-of-service” is believed to be a barrier. This includes concerns over reliability of the telecommunications link,(14,18) and audio transmission clarity.(18) To address some of these concerns, the FCC dedicated a portion of the radio spectrum


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for wireless medical telemetry devices such as heart, BP, and respiratory monitors. This was a direct result of American Hospital Association’s concerns over how electromagnetic interference with wireless telemetry equipment can impact patient safety. They cited how a Dallas TV station testing digital television monitor knocked out of operation low-powered heart monitors at Baylor University Medical Center and Methodist Medical Center. Although no one was harmed, patients were put at risk.(25) Patients Similarly to making physicians feel less isolated from their urban peers, telemedicine applications can increase access to services for remotely located patients.(9) Home health patients needing constant monitoring are afforded the luxury and convenience of staying home. The use of videoconferencing allows for an interactive live examination by a physician. One such elderly patient argued, “I feel more secure. Without the video, I would feel more alone.”(26) In addition to providing expanded access to specialists, a travel cost saving can be realized.(27,28) This can minimize the burden associated with family care givers that transport family members and/or coordinate their transportation to medical facilities. First time telemedicine patients consistently, report high levels of satisfaction.(13,17,29) This is partly because telemedicine has been demonstrated to significantly speed-up case turnaround.(30) Supporting findings were reported in the home healthcare setting, where patient satisfaction was found to be higher than expected. Patients found it comforting to know help was close at hand should they need it. Finally, a study found that 90% of rheumatology patients said they were satisfied or very satisfied with their telemedicine experience.(31) While telemedicine provides several potential benefits to patients, it also has at least one considerable drawback. Reluctance to use telemedicine by patients has been cited because of a perceived vulnerability in security, confidentiality and privacy.(18,32,33) This issue can range from concerns over criminal tampering and interception of records to accidental viewing of records to unauthorized participation by persons in treatment office.(29) No currently fully implemented federal law exists that has general applicability, providing uniform protection to patient health information with respect to telemedicine.(34) Hospital Administrators When considering technologies in general, early-adopting hospitals seem to be most influenced by technologic competition, whereas late-adopting hospitals are more likely to be influenced by competition for revenues.(5) In the case of the latter, hospitals must consider that they are not only competing for revenue, but also for the loyalty of their doctors whose admitting privileges generate additional financial returns. Because physicians are more likely to affiliate with, and admit patients to hospitals where they can employ the latest technologic tools(35) hospitals may be further pressured into adopting certain technologies. Evidence suggests that the more integrated an application, the more complex the innovation and the harder it is to implement swiftly.(36) From the perspective of hospital administrators, the primary


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advantages offered by telemedicine relate to cost savings and more efficient utilization of resources.(15,37) For example, one study demonstrated that a nurse’s daily caseload increased from 5 to 15 patients similarly reducing average length of visit from 45 min (in person) to 18 min (online).(15) When coupled with the existing hospital IT capabilities, telemedicine can facilitate increases in efficiency and quality of care.(9) Hospitals also benefit by their ability to refer patients, share resources, and equipment with remote sites. This tends to reduce duplicate expenditures and out-of-network referrals.(9) One particular telemedicine initiative resulted in a reduction of 82% of out-of-hospital transfers. The retention of these patients generated an additional $80K in revenue and 5% reduction in nursing overtime hours.(38) When considering variable costs, telemedicine programs frequently generate profit.(7,9,37) Additionally, an increase in referrals can result from the ability to foster networking relationships with smaller hospitals or clinics.(7) Administrators must also consider other, less tangible, benefits for their hospital. For example, telemedicine can foster an impression of technological leadership.(13) This desire for social status is consistent with what Rogers(6) considered an important motivation for adoption of innovation. Finally, telemedicine has also been used as a loss leader to bring in new customers.(13)

Compatibility Physicians There are several characteristics of telemedicine, which render it compatible with the existing values and experiences of physicians. To begin with, evidence suggests, that given proper equipment and training, radiographs interpreted by teleradiology can be as reliable as traditional hard copy radiographs.(24) Similar findings have been reported for store-and-forward teledermatology(39) and ophthalmology.(40) Accordingly, these technologies yield results which are equivalent to those physicians expect from more traditional technologies. Telemedicine’s acceptance by physicians can grow, as information technologies become part of daily medical practice.(2) Physicians routinely use software for billing and scheduling appointments. The use of computer-based patient records is also on the rise. A Michigan survey reported that about 40% of physicians practicing in the state use desktop computers in their practice.(2) Thus, there is a convergence between physicians’ technology experiences in other aspects of their practice and with the technology on which telemedicine is based. Despite these positive findings, some physicians find the technology to be discomforting and are slow to adopt because they are incapable or unwilling to commit time to alter their practice patterns.(24) The telemedicine technology is different enough from the daily operation of these physicians to deter acceptance. Selling the concept of “medicine from a distance” to healthcare providers can in itself be a major hurdle. Many physicians, particularly older ones, may be uncomfortable with using technology in general.(13) Finally, a lack of proper and ongoing training has also been found to impede the use of telemedicine.(14,18)


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Patients One way in which telemedicine is compatible with patients’ experiences is rooted in the infrastructure utilized to deliver telemedicine solutions. Many telemedicine applications designed for patient use at home, utilize existing telecommunication infrastructures. This includes standard telephone and cable lines as well as home computers.(41) Since patients continue to using this infrastructure for other applications, the technology hurdle is somewhat reduced. However, as in the case with physicians, telemedicine requires some changes in the ways that patients receive their healthcare. Patients must be reeducated and given a chance to adjust to a new type of treatment. They may not feel comfortable being diagnosed by a doctor that is potentially hundreds of miles away.(32,42) Hospital Administrators Most of the compatibility issues with regard to administrators revolve around how well telemedicine fits within their existing operations or clinical product lines. Administrators value the importance of having a unified, understood, and agreed upon vision with respect to the management and use of a telemedicine initiative.(9) This is particularly important when used in conjunction with existing IT systems to produce a synergistic affect. In fact, lack of a fit with the strategic plan and mission, has been associated with telemedicine initiative failures.(9)

Trialability Physicians Physicians are more likely to adopt telemedicine if it can be tried on a limited basis. Cost reductions and technology proliferation enhance this trialability. Supporting Moore’s law, computing power has increased exponentially while prices for hardware have substantially decreased.(9) This coupled with the increasing availability of broadband Internet connections(13) and free software can promote the occasional use of telemedicine videoconferencing by private physicians.(9,43) Some physicians now split their time between their traditional practice and telemedicine consultations.(44) Hospital Administrators There are several characteristics of telemedicine that facilitate limited trial by hospital administrators. Funding or support for a program initially provided by a grant or vendor can effectively provide for a trial basis use.(9,20) Additionally, the option to lease expensive equipment is associated with higher successful telemedicine adoption rates.(26) Finally, high telecommunication costs can be mitigated by utilizing infrastructure for other uses (i.e., health education, administration, and other nonclinical uses).(9,24,26)


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Observability Physicians The benefits of telemedicine are more readily apparent to certain types of physicians than others. Expectedly, medical specialties that already rely on the use of images for diagnosis (i.e., radiology, ophthalmology, pathology) experience greater ease in observing and describing telemedicine benefits.(45–47) It is not surprising therefore that radiology teleconsults are the most common type of teleconsultation.(2) Patients While the clinical benefits of telemedicine may not be readily apparent to patients, not having to spend considerable time in travel is most apparent. As one researcher aptly states, “Very few people have heard of telemedicine, so when you set it up, you need to publicize that you’ve done it.”(13) Hospital Administrators As in the case with patients, the benefits of telemedicine may not be readily apparent to hospital administrators. In particular, the economic benefits of telemedicine are not always obvious.(13) As a relatively new technology, financial decision makers may have not seen proof that investment in telemedicine will bring attractive returns (unlike buying a machine and saying if we do 100 tests per month, it will pay for itself in 3 months). Real savings are largely the result of less observable benefits such as higher quality care, which can reduce the need for other high-cost treatments.(15) Studies to determine cost effectiveness of telemedicine initiatives have been limited to provide inadequate data. Ongoing evaluations are attempting to enumerate costs and benefits but there are still not enough cases to provide the empirical data regarding specific costs of telemedicine.(27) Complexity Physicians Researchers report that one barrier to telemedicine adoption is the complexity of the technology. While the equipment tended to work as specified, many physicians have found the system to be too complex and sophisticated to use regularly.(18) Compounding this complexity is an increasing number and frequency of available telemedicine applications. Any clinical telecommunication or IT initiative requires ongoing and onerous training (both technical and nontechnical) of physicians.(26) Furthermore, when equipment includes extensive and unnecessary features not required by a given user, the need for superfluous training is exacerbated.(18) Hospital Administrators The lack of clear guidelines and regulations governing telemedicine creates considerable complexity for hospital administrators. Telemedicine initiatives require flexibility and creativity to respond to legal, technical, and political challenges.(26)


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Documentation is a major concern with such issues as the logistics of record keeping, determining who initiates and maintains the patient’s record, who is ultimately responsible as custodian of the record and whether encounters with patients will be videotaped.(27) As mentioned above these issues become a greater challenge when the economic benefits are not always obvious.(13) There is an overall lack of rigorous, unequivocal evidence that assesses telemedicine effects on cost, quality, access, and satisfaction by patients and providers.(48) This complicates the decision to adopt telemedicine initiatives. More so, the need to comply with strict federal (HIPAA) and accreditation (JCAHO) standards can be a barrier.(49) Payers The effect of healthcare payers on technology diffusion is not homogenous. Studies have found that the introduction of the U.S. Medicare and Medicaid programs have accelerated the diffusion of some healthcare technologies.(50) However, other government activities including prospective reimbursement and certificate of need legislation were shown to slow the adoption of innovations.(50,51) Additionally, researchers demonstrated that prospective payment system appeared to accelerate the diffusion of cost-reducing technologies.(52,53) Thus, it is anticipated that payers should be willing to adopt telemedicine since preliminary evidence indicates that telemedicine can reduce costs. Cost savings result from reduced commuting and transportation costs for both the doctor and patient. Reductions in duplication of tests and record and, easing of claims processing (more efficient and cost effective) and reduces other administrative costs and delays.(32) The net effect of telecommunications and IT can potentially reduce annual healthcare expenditures in United States by $36 billion.(10) As another benefit, insurance companies can use this technology as means of expanding market area to include rural patients.(13) As previously mentioned, legislation to increasing Medicare and Medicaid reimbursement to rural and physician shortage areas will promote adoption.(11) As mentioned previously, recent evidence suggests that payers are beginning to reimburse telemedicine services. For example numerous private health insurance companies, managed care organizations, and state Medicaid programs are reimbursing for telemedicine services.(3) Furthermore, some states have passed laws requiring reimbursement for telemedicine consultations.(3,24) Since Medicare usually sets the standard for what other insurance companies will reimburse for, adoption by government programs will promote adoption among private payers. However, on the one hand, a study found that as managed care penetration increases, adoption of innovation of medical technologies (such as MRI) decreases.(54) On the other hand, many telemedicine applications can be implemented at a much lower cost than expensive technologies. DISCUSSION In general, healthcare managers, practitioners, and other telemedicine proponents need to address the uncertainty associated with using telemedicine for each of


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the key adopter groups. Major uncertainties faced by physicians center on quality of care, quality of service, and complexity issues. Additionally, there are legal uncertainties facing physicians. For patients, key uncertainties include adjustments to a new way of interacting with healthcare providers and concerns over security, confidentiality, and privacy. Administrators face concerns over cost effectiveness, reimbursement, and legal issues. Finally, payers need to be sure that endorsing telemedicine procedures may actually result in lower overall healthcare costs. For telemedicine systems to increase penetration throughout the existing healthcare system, several issues must be addressed. First and foremost, it is clear that the four adopter groups possess different values, experiences, and motivations guiding their adoption decisions. Therefore communications efforts need to emphasize the key benefits of telemedicine to each of the adopter groups. For physicians these include telemedicine’s ability to 1) increase the overall quality of care provided, 2) increase the efficiency with which physicians perform their jobs, and 3) promote collaboration among physicians. For the most part, patients are likely to use telemedicine if their healthcare providers recommend it. Accordingly, they may not appear to be an important audience for marketing-related communications. However, as the pharmaceutical industry has learned lately, pull strategies aimed at patients can be very successful in creating demand. Indeed, Greer found that the media could increase patient demand for medical technology resulting in pressure on healthcare providers to adopt said technology.(55) Marketing communications aimed at patients should stress the convenience aspects of telemedicine. Additionally, these communications should seek to lessen concerns over confidentiality, security, and privacy issues. Because hospital administrators are primarily concerned with economic related issues, communications should stress the potential cost savings associated with the use of telemedicine initiatives. Additionally, emphasis should be placed on return on investment data, which demonstrates the economic benefits of telemedicine adoption. Finally, lobbying efforts aimed at legislators, regulators, and payers may be necessary. Since endorsement by these parties will reduce barriers for other adopter groups, successful communications efforts at this level are critical. Economic and quality of care arguments are likely to be most effective with these audiences. The design of telemedicine systems is also crucial to adoption. Ease of use is a major concern for physicians and end users. As Falas et al.(56) point out, systems that are not user-friendly are not likely to be adopted even if they could be of great benefit. Telemedicine systems designed with intuitive interfaces should help overcome resistance to the use of “new” technology. Additionally, training requirements should be reduced as a result of improvements in ease of use. From the perspective of hospital administrators, design features that reduce acquisition and use costs should increase adoption rates. Such design features might include modularity so that investments in functionality can be made on an as needed basis. Additionally, the use of industry standards for aspects such as communications protocols will allow buyers to create best-of-breed solutions from different vendors. Finally, equipment that interfaces easily with existing IT infrastructures should reduce implementation and maintenance costs.


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