U.S. & Global Telemedicine Markets - Market Article

Industry Assessments & Perspectives

The telemedicine market has ebbed and flowed during the past ten years, as have the definitions and segmentation.  While online resources and technologies suggest there may be great potential, many basic questions about telemedicine's core benefits and capabilities with respect to cost effectiveness, reimbursement, and ubiquity remain unanswered. Independently produced evaluations continue to call for "quantitative data" that anyone who follows the industry would expect to be readily available by now from demonstration projects and research studies that were reportedly initiated and completed years ago.[1] Feed-back.com's staff respectfully suggests that current developments require historical context to put recent market forecasts into perspective.

Telemedicine & Telehealth

Telemedicine consultations continue to lag behind the "store-and-forward" segment of the market, despite decades of federal funding that has supported development of more than 200 programs nationwide.   While remote diagnostic services such as cardiology, dermatology, and radiology are robust, consultation services lack a workable business model for paying providers. An excellent article published in May 2010 by the American Health Information Management Association (AHIMA; Chicago IL) argues that telemedicine can fill consumer demand and expectations for online access to health care services.[2]

Organizations such as the American Telemedicine Association (ATA; Washington D.C.) generally define telemedicine as the exchange of medical information from one location to another via electronic communication (e.g., videoconferencing) which enables physicians to assist patients and to improve their health status. According to the Centers For Medicaid And Medicare Services (CMS; Baltimore MD), telehealth typically includes a wider scope of services beyond those provided in clinical settings that are transmitted via electronic mail, facsimile, and telephone. Telehealth and telemonitoring are apparently equivalent terms that refer to use of information technology and telecommunications over distances to assess health status, consult, diagnose problems, intervene, supervise, etc.[3]

Market Segmentation

A quick review of published materials suggests that telemedicine services can be broadly divided into the following categories:

Market reports follow a similar pattern, focusing on segments such as: 

Revenue estimates are typically broken into the following groupings: Equipment / hardware, software, telecommunications, and services.

In recent years, specialty service categories have expanded significantly from relatively well-established early offerings (e.g., telecardiology, teledermatology, telepathology, telepsychiatry, and teleradiology). The ATA product and service provider directory now includes some interesting options such as: Ocular Telehealth, Pediatric Telehealth, Teledentistry, Telehospice, TeleICU, Telemental Health, Teleneurology, Telerehabilitation, and Telestroke.

State Of The Telemedicine Industry

In 2005, the ATA presented an Issue Paper that identified “opportunities for collaboration and to better understand the interaction between telemedicine/telehealth services and health information technology (HIT)”.[4] At the time, there were approximately 200 telemedicine networks involving 3,500 medical and health care institutions within the United States. The current estimate for the latter figure, however, has fallen to 3,000 (ATA web site, May 2010).  An assessment of expertise and remaining needs focused on the following:

Another assessment published by Health Futures Digest described two interesting telemedicine trends in 2006.  From 2003 to 2006, the number of home telecare manufacturers increased from five to 15.  In terms of forecasting, the Veteran’s Administration expected to increase the number of patients receiving home telecare to 20,000 between 2006 and 2007.[5]

As in the past, there are barriers to widespread implementation.  In an article published in December 2006, Midwest Business & Technology News described how telemedicine can improve distribution of Indiana’s health care resources throughout the state.  A recent national census revealed that approximately 72% of Indiana’s counties were designated as areas which were underserved or had shortages of key health care professionals.  For example, 87% of active care physicians in Indiana are located in urban parts of the state.  Several major facilities (such as Purdue, Riley Hospital for Children, and St. Vincent) are already using telemedicine to provide medical consults to some rural areas. 

Obstacles to wider implementation include the need for:  Affordable broadband, infrastructure development, reimbursement for service providers, and strategic regional decision-making to improve telecommunication systems. Current information from the ATA suggests that federal funding for the U.S. telemedicine market is still significant, with investments that support demonstration and research grants, direct telemedicine services, and reimbursement through Medicare.

To learn more about the full report, visit: 2010 U.S. & Global Telemedicine Markets.

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[1] Telemedicine demonstration programs have existed in Alaska and Hawaii since May 2006, and Medicare reimbursed qualifying telemedicine services at that time.

[2] "Telemedicine: Bridging Gaps In Healthcare Delivery," Journal of AHIMA, v.81, n. 5, May 2010.

[3] Ibid.

[4] “Telemedicine, Telehealth, and Health Information Technology: An ATA Issue Paper”, published by the American Telemedicine Association.

[5] "Telemedicine on the Rise," Health Futures Digest, March 2006.