Telehealth is defined as “delivering care at a distance” and by that definition, the launch of a telehealth service requires a mindset of launching a new healthcare service offering. Yet many organizations approach telehealth as a Health IT implementation project and are hereby overlooking the need for workflow design, organizational change management and defining and managing the business case.

Over the years of leading telehealth implementations, we’ve identified a set of 16 common fails in setting up and rolling out a telehealth service. We’ve categorized them into sets of four across these four failure areas:

I. Project-level fails, that are best remedied through proper project management.

II. People-related fails, that are most easily avoided through proper organizational change management.

III. Financially-related fails, caused by decisions rooted in the lack of experience of telehealth financials.

IV. Technology-related fails, that ironically are often caused by focusing too much on the technology and not enough on the people and processes.

Last week’s newsletter covered the first 8 of the 16 ways that telehealth service rollouts can fail:

I. Project-level Fails

1) Time Fail

2) Budget Fail

3) Scope Fail

4) Quality Fail

II. People-related Fails

5) Confusion Fails

6) Hesitancy Fails

7) Frustration Fails

8) Resistance Fails

This week’s article covers the 4 financially-related fails of telehealth services and we’ll wrap up the series next week with the remaining four technology-related fails.

Financially-Related Fails

This set of fails pertains to the ways in which the telehealth financially does not live up to its promises.

9) Lack of Reimbursement: Over the past 20 years the situation for reimbursement for telehealth services as a fee-for-service offering has continued to improve, though the US’s telehealth reimbursement landscape remains frustratingly complex with at least four different payor groups (Medicare, Medicaid, commercial insurance and self-insurers) and a whole host of conditions to be met and variables to be considered. And even if you have all your i’s dotted and t’s crossed, getting the actual reimbursement requires diligence and persistence, as the many levels of the convoluted system are not familiar with the actual laws and regulations. The solution here is to expertly and doggedly navigate the insurance regulations and 1-800 numbers to ensure that claims indeed will be honored. Often it’s knowing which questions to ask (and in which way) and which regulations to consult or to cite that will pave the way to consistent reimbursement.

10) Unfulfilled Savings: Some telehealth business models use downstream savings as part of the ROI calculation. While the mechanisms by which the organization stands to save money (e.g., by reducing non-reimbursed utilization or avoiding penalties) are known by the original creators and planners of the telemedicine service, most often the operational and clinical staff are not aware of those metrics and are therefore those savings are often not realized. The solution here is to realize that “every system is designed to get the results it gets” and if savings are the results you desire, you have to have systems in place that visibly monitor and track those savings or that act as “bumper rails” to make sure that the processes are followed as intended.

11) Fixed Cost Too High: Related to the previous fail is sometimes the realization that the service is used by far less patients than originally anticipated. This results in revenue not being as high or savings not adding up as originally planned. With that, the fixed cost such as a monthly service fees or designated staff becomes too high and makes the service financially unsustainable. As with many innovations, “build it and they will come” does not work and it takes a very conscious effort of heavy lifting to ensure that patients are aware of the service, understand its benefits for them, and know how to use it properly. While many healthcare organizations are accustomed to creating new service offerings within their own four walls, very few have experience in launching a new service that occurs outside those walls.

12) Unsustainable: The financial “unsustainability” of a telehealth service most often has its roots in poor change management as indicated by the people-related fails #5 through #8. The effect is a lack of interest by the clinicians to offer the service which in turn affects the predictions about volume, revenue, and/or savings. The solution here is to first perfect the processes with a small team of dedicated individuals to create early successes that can be leveraged to inspire others to invest in this new mode of delivering care.

In the last part we will cover the last 4 fails in the areas of technology.

How has your telehealth service failed financially and how were you able to recover? Did you shut the service down or did you pivot? If so, how?

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Christian Milaster and his team optimize Telehealth Services for health systems and physician practices. Christian is the Founder and President of Ingenium Digital Health Advisors where he and his expert consortium partner with healthcare leaders to enable the delivery of extraordinary care.

Contact Christian by phone or text at 657-464-3648, via email, or video chat.