News Feature | May 29, 2015

Telehealth Pilot Yields 27% Cost Savings For Banner Health

Christine Kern

By Christine Kern, contributing writer

EHR Savings

Hospitalizations of chronically ill patients see 45 percent reduction within first six months.

Royal Philips and Arizona-based Banner Health have banded together in a joint telehealth pilot program aimed to address the shift towards value-based care and increased penalties for readmissions. The program has resulted in a reduction of hospitalizations among chronically ill patients by 45 percent and significant savings within the first six months of the trial.

The Intensive Ambulatory Care (IAC) pilot program focuses on the most complex and highest cost patients: the top 5 percent of patients who account for 50 percent of healthcare spend. First launched in 2013, the IAC program is designed to improve patient outcomes, care team efficiency, and prevent IAC patients from entering the acute care environment where costs are significantly higher.

According to HIT Consultant, the program assessed the care of 135 patients to determine the program’s effectiveness in meeting its clinical and financial goals. The company announced results of each patient’s first six months.

“The results of our at-home telehealth pilot with Philips have been dramatic and are indicative of the exponential success such a program could have by engaging patients in their own care and building a strong support system around them,” said Dr. Hargobind Khurana, senior medical director of Health Management, Banner. “As we continue to expand this program, we anticipate seeing further proof that telehealth programs can address readmissions rates, reduce costs, and improve the health and quality of life for patients with multiple chronic diseases.”

The pilot reduced costs of care by 27 percent, driven primarily by a reduction in hospitalization rates and days in the hospital, as well as a reduction in professional service and outpatient costs. It also reduced hospitalizations by 45 percent.

Prior to enrollment in the IAC program, there were 11.5 hospitalizations per 100 patients per month; after enrollment, the acute and long-term hospitalization rate dropped to 6.3 hospitalizations per 100 patients per month. The program reduced acute and long-term care costs by 32 percent, primarily due to the decrease in hospitalizations. Acute short-term hospital stays decreased from 7.7 hospitalizations per 100 patients per month to 4.9. The average number of days in the hospital per 100 patients per month also trended down from 90.2 to 65.8.

“Telehealth is opening up choices for patients and providers, giving them the freedom to transform how, when and where proactive care is delivered to patients,” said Derek Smith, senior vice president, Hospital to Home, Philips. “By focusing on those patients who generate the greatest health care spend, we’re able to help these individuals get better care in the comfort of their own homes, while also helping health systems achieve the financial reductions they need.”