Telemedicine Adoption and Medicare Reimbursement: Analysis of California Hospitals and Patient Discharges, 2008-2016

Abstract

Novel health delivery systems, since their earliest conceptions, are thought to improve the way that hospitals treat patients more efficiently and effectively. Telemedicine, a digital health delivery system, is used to treat patients who are located far from the provider.

This thesis explores current telemedicine reimbursement policies that are thought to promote the adoption of telemedicine in rural areas. Reimbursement helps to promote the efficiency and reach of treatment programs, providing more available care for patients. One of the most pressing questions is how to reduce emergency department overcrowding by triaging preventable cases remotely.

This thesis answers two questions: First, does telemedicine adoption change based on different hospital-based factors? Second, does adoption reduce unnecessary emergency department visits? The findings complicate policy assumptions regarding hospital telemedicine adoption and patient discharge outcomes using quantitative methods.

Chapter 1 contextualizes and introduces the role of technology adoption in medicine. It includes a telemedicine-specific discussion of Medicare reimbursement and the fundamental knowledge gaps in health services research for policy.

Chapters 2 and 3 estimate a model of determinants predicting telemedicine adoption in California hospitals from 2008-2016. Hospital ZIP code-based social/financial variables, ownership status, and geography are all important predictors of hospital telemedicine adoption. These variables can be useful in discerning impact of current Medicare reimbursement policies on particular hospital types.

Chapters 4 and 5 estimate a model predicting patient discharge outcomes after telemedicine adoption at Kaiser Foundation Hospital – San Diego from 2010- 2014. This model predicts how Medicare insurance, telemedicine adoption, and Telemedicine-preventable cases predict discharges. Telemedicine adoption after 2013 significantly reduces emergency department visits resulting in home discharge, which indicates a decrease in unnecessary emergency visits. However, patients who are examined in the emergency department with telemedicine- preventable cases are likely to have more severe discharge outcomes.

Chapter 6 concludes by providing implications and future directions for research that may answer targeted questions about patient and hospital behavior, regionally and nationally.