The United States spends $3.5 trillion annually on healthcare – more than $10,700 per person and nearly 18% of its GDP.  That’s by far the most expensive among developed countries, but it’s a figure that is much higher than it needs to be.  Recent research suggests a quarter of the country’s healthcare spend is waste, which accounts for $760 billion to $935 billion, or about a quarter of the country’s total healthcare spend.

The waste comes from a number of sources and process within the healthcare environment, many of which are related to inefficiencies in the system.  Areas that account for the majority of the waste include:

Failure of Care Delivery – Can refer to a number of issues, including hospital-acquired conditions, lack of access to appropriate care, and lack of attention to available preventative care measures.

Failure of Care Coordination – Includes unnecessary or avoidable admissions, lack of communication between providers or physicians, and readmissions due to ineffective care or treatment.

Overtreatment or Low-Value Care – Can refer to unnecessary or ineffective medications or services, low-value testing, screening or other procedures that don’t produce the required results, and overuse of services like end-of-life care.

Pricing Failure – Can include price increases above market standards, lack of pricing transparency, inconsistent pricing for medication, healthcare services, lab tests and screenings, and ambulatory services.

Fraud and Abuse – While largely focused on the Medicare population, this can extend to misreporting services, inaccurate billing, over prescribing, inaccurate diagnoses, and other means of misrepresenting services or costs.

Administrative Complexity – includes time doctors and staff spend on reporting, coding, billing, paperwork, and other manual tasks related to patient records, scheduling, and payer reporting.

At least some of the inefficiencies in the system that lead to waste may be able to be prevented through expanded use of digital connected health solutions.  While connected health services are growing, the need to reduce waste and deliver better and more efficient care may provide additional motivation for increased adoption among healthcare providers.

Improved Access

Telehealth offers an opportunity to provide access to appropriate physicians and specialists wherever they or their patients may be located.  This can help ensure patients receive care from the most appropriate physicians for their specific needs, when they need it.  Reductions in wait times can help patients receive care faster, reducing the chances of complications due to delay, and can help reduce the spread of illness in providers’ offices and hospitals.

Increased Coordination

Telehealth can also enable doctors to include other physicians and specialists to coordinate care, particularly for patients with multiple conditions, or to seek advice to ensure the most appropriate tests or treatments are used.

Patient Communication

Patient portals, automated reminder systems, and other digital communications can simplify the scheduling and communication process, leaving more time for clinic staff to focus on other tasks.

Preventative Care

Remote patient monitoring can help track at-risk patients, or those with specific conditions, alerting caregivers and physicians to warning signs before conditions worsen and office visits or hospitalization is required.  RPM can also help with treatment and medication adherence, reducing risks associated with lack of adherence and over-prescribing or prescribing the wrong treatment.  Connected health solutions will also be an important factor in the success of population health initiatives designed to identify broader healthcare trends and prevent common conditions across population groups.

Automated Data

The data generated by connected health services – patient readings, services used or delivered, time spent, etc. – can all be automatically appended to patient records, reducing time spent manually entering data.  Integration with billing and payer systems can also reduce time spent on communicating that information and, along with updated CPT codes for telehealth and RPM services, can help increase accuracy of records and billing for services provided.   Automation of many of these traditionally manual tasks can also reduce waste due to error and fraud.

There’s clearly a need to reduce waste in healthcare delivery.  Digital healthcare models are creating opportunities to address the problem in new ways by increasing process efficiency and accuracy, and without having to resort to more traditional cost-cutting methods like staff and pay reductions, which can actually increase workloads and increase burnout rates.

To learn more about how to increase healthcare efficiency and reduce waste using connected health, connect with us here.

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