Telehealth seeking mass market business model

Telehealth is too cheap for the home health companies, and too expensive for the monitoring companies. Intel needs a few good franchisers.
Written by Dana Blankenhorn, Inactive

Telehealth has a great value proposition, and its advocates see good business models on the horizon.

What the field lacks are boots on the ground to seize the opportunity. (Picture of the  Intel Home Health Guide in action from CNET.)

Intel Health director of product marketing Charles Goodwin explained this to me today. A recent survey with top health care executives showed most see the value in monitoring patients remotely, and most expect it to happen.

But most see a fear by both doctors and patients of the technology, and they openly wonder how providers can get paid.

So what happens now?

"Home health care agencies get a set fee for providing care to a patient who has been discharged from the hospital and been prescribed home care, usually for 30-60 days," he explained.

"Since they get a fixed payment for the patient they're motivated to invest in technology, in innovating workflows to reduce costs,"

The sickness model for care we presently employ will pay for the hospital, it will pay for the rehab center, it will even pay for visits from a home health care worker. But once grandma is thought to be well, she's on her own.

There's no business model for keeping that gear installed, for keeping the connection intact, for collecting data and monitoring wellness. Gear is being taken out, it's being re-used, and Intel finds itself with a niche business.

I feel that pain. My mom broke her hip last month. She's 86. She went into the hospital, where she had a pin inserted. Then she went to a rehab center, where she exercised enough to start using her walker. Now she's at home, and someone comes twice a week to make certain she's doing her exercises.

But she needs more. She needs monitoring. I could pay for it, if there were someone out there to sell me, but I don't really get the financial benefit of her wellness, just the psychic benefits from knowing my mom's OK.

What she needs, I told Goodwin, is someone like my late father.

After 20 years running a TV repair shop in New York, my dad moved to California, and eventually bought a lock shop. It was a good business. He had lots of commercial accounts, mostly chain stores, who paid him each month to be on call in case they needed doors opened or locks changed.

There are many businesses that work this way. Home security businesses work this way. Answering services work this way. There is, and has been, a business model for such industries.

What someone like my dad would need to do this is a business model, something like the one he had at the lock shop.

"I don't think the cost is the barrier, in terms of our discussions with home health agencies. They're not even making the offer to patients to keep it," Goodwin said.

"We've talked to service companies (like LifeAlert) and they have to make a decision to hire clinicians and monitor these results. That's a big decision for them. It's a change in their business model."

Telehealth is too cheap for the home health companies, and too expensive for the monitoring companies, who would have to hire nurses and maybe even doctors to respond in emergencies.

Worse, the financial benefits from telehealth flow to those paying the bills. Right now that mainly means insurers and the government.  And they're still on the sickness model, although health reform gives Goodwin confidence that over time this will change.

So I asked Goodwin a startling question. Ever been to a franchise show?

The franchise industry is filled with entrepreneurs who can see opportunities, package them, and re-sell them to lots of people. The industry has salesmen who can sell insurers and self-insurers on the value proposition, who can package that opportunity for small businesspeople, train them, and get mass industries going fast.

Why do you think there are bagel stores everywhere? In a few clicks I was able to find literally dozens of franchise companies, catering to the needs of seniors' health.

Maybe, with Intel pushing from above and franchises pushing from below, we can solve this problem before I fall and can't get up.

This post was originally published on Smartplanet.com

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