600 TELEMEDICINE and e-HEALTH JULY/AUGUST 2009 DOI: 10.1089/tmj.2009.9960
Rashid L. Bashshur, Ph.D.,1 and Gary W. Shannon, Ph.D.2
Contributing authors: Elizabeth A. Krupinski, Ph.D.,3 Jim Grigsby,
Ph.D.,4 Joseph C. Kvedar, M.D.,5 Ronald S. Weinstein, M.D.,3
Jay H. Sanders, M.D.,6 Karen S. Rheuban, M.D.,7 Thomas S. Nesbitt,
M.D.,8 Dale C. Alverson, M.D.,9 Ronald C. Merrell, M.D.,10 Jonathan
D. Linkous,11 A. Stewart Ferguson, Ph.D.,12 Robert J. Waters, J.D.,13
Max E. Stachura, M.D.,14 David G. Ellis, M.D.,15 Nina M. Antoniotti,
Ph.D.,16 Barbara Johnston, M.S.N.,17 Charles R. Doarn, M.B.A.,18
Peter Yellowlees, M.D.,19 Steven Normandin,20 and Joseph Tracy21
1University of Michigan, Ann Arbor, Michigan; 2University
of Kentucky, Lexington, Kentucky; 3University of Arizona,
Tucson, Arizona; 4University of Colorado, Denver, Colorado;
5Harvard Medical School, Boston, Massachusetts; 6The Global
Telemedicine Group, McLean, Virginia and the Johns Hopkins
School of Medicine, Baltimore, Maryland; 7University of Virginia
Health System, Charlottesville, Virginia; 8UC Davis Health
System, Sacramento, California; 9University of New Mexico,
Albuquerque, New Mexico; 10Virginia Commonwealth University,
Richmond, Virginia; 11American Telemedicine Association,
Washington, DC; 12Alaska Native Tribal Health Consortium,
Fairbanks, Alaska; 13Center for Telehealth and E-health Law,
Washington, DC; 14Medical College of Georgia, Augusta, Georgia;
15State University of New York at Buffalo, Buffalo, New York;
16Marshfield Clinic Telehealth, Marshfield, Wisconsin; 17Medical
Board of California, Sacramento, California; 18University
of Cincinnati, Cincinnati, Ohio; 19UC Davis Health System,
California, Sacramento, California; 20AMD Global Telemedicine,
Boston, Massachusetts; and 21Lehigh Valley Health Network,
This document reflects the strongly held views and perspective of a
diverse group of healthcare academicians, researchers, providers, and
industry representatives from across the country who share a belief in
the necessity of healthcare reform and the centrality of telemedicine—
or information technology–enhanced healthcare—in that reform.
The need for reform stems from long-standing problems in our
health system, and the central role of telemedicine derives from
an ever-expanding body of research and experience that attests to
its merit in addressing these problems. Despite the fact that the
United States spends more on healthcare than any other country,
both in absolute numbers and on a per capita basis, the health
status of Americans ranks relatively low when compared with that
of people in other developed nations. Moreover, the general dis-
crepancy between expenditures and health status indicators in the
United States masks significant differentials among segments of the
population, based on socio-economic, geographic, cultural, ethnic,
and other factors. Hence, we continue to suffer from inequities in
access to healthcare, inefficiencies in the delivery of care, escalat-
ing costs, and the prevalence of adverse lifestyles that exacerbate
Much attention has been devoted to the utility of the electronic
health records (EHRs) as a means to improving the healthcare system.
Yet, despite its potential benefits, the EHR represents only a partial
solution to the problems we face. A broader focus on telemedicine (also
frequently referred to as telehealth or e-health) that incorporates EHRs
is a more prudent and effective approach. We believe that an exclusive
concern with developing system-wide EHRs, while laudable and poten-
tially valuable in improving one sector in healthcare delivery, would
ultimately increase the cost of care without contributing to necessary
changes in the rest of the system.
National Telemedicine Initiatives:
Essential to Healthcare Reform
© MARY ANN LIEBERT, INC. • VOL. 15 NO. 6 • JULY/AUGUST 2009 TELEMEDICINE and e-HEALTH 601
NATIONAL TELEMEDICINE INITIATIVES
Telemedicine technology embodies the electronic acquisition, pro-
cessing, dissemination, storage, retrieval, and exchange of information
for the purpose of promoting health, preventing disease, treating the
sick, managing chronic illness, rehabilitating the disabled, and protect-
ing public health and safety. Telemedicine systems consist of collabora-
tive health networks, facilities, and organizations dedicated to these
objectives. Over the past several decades, telemedicine systems have
demonstrated the capacity to do the following:
• Improve access to all levels (primary, secondary, and tertiary) of
healthcare for a wide range of conditions—including, but not limit-
ed to, heart and cerebrovascular disease, endocrine disorders such
as diabetes, cancer, psychiatric disorders, and trauma; as well as
services such as radiology, pathology, and rehabilitation.
• Promote patient-centered care at lower cost and in local environ-
ments that also contributes to stabilizing local healthcare and
• Enhance efficiency in clinical decision making, prescription order-
ing, and mentoring.
• Increase effectiveness of chronic disease management in both long-
term care facilities and in the home.
• Promote individual adoption of healthy lifestyles and self-care.
Telemedicine has costs and benefits. However, the benefits accruing
to providers, clients, and society at large far exceed the cost. These
benefits include: providing primary care physicians with ready access
to specialist colleagues; extending the reach of specialist providers
at tertiary care centers; integrating medical services across multiple
delivery sites; obviating unnecessary patient travel to distant special-
ists; enabling rational triaging of patients; minimizing duplication of
diagnostic tests and clinical services; stabilizing rural providers and
local economies; and enhancing access to care for institutionalized
populations while reducing cost and enhancing public safety.
The tasks facing the nation in improving the health status of
Americans through major reform of the health system are formidable.
This reform must assure improved access to appropriate and quality
healthcare while controlling costs. One necessary component of this
reform is the provision of insurance coverage for people who are under-
or uninsured. However, health insurance does not guarantee appropri-
ate access to healthcare that is not distributed equitably. Hence, we
acknowledge that telemedicine is not the panacea for healthcare reform.
Rather, it is a cost-effective and clinically effective solution. A corner-
stone of telemedicine development rests in the simultaneous require-
ment of parity in reimbursement between telemedicine and in-person
care. The current context for reform presents an ideal opportunity for
the full-fledged integration of telemedicine in the health system, with
far-reaching benefits for this and future generations.
Key words: healthcare reform, telemedicine/telehealth, electronic
he signatories to this document represent a diverse group of
healthcare academicians, providers, researchers, and indus-
try representatives from across the country who share a
belief in the urgent need for healthcare reform coupled with
a knowledge of and commitment to the potential of telemedicine/
telehealth/e-health (hereafter referred to as telemedicine) as a neces-
sary component of this reform. We submit this statement in the firm
belief that the healthcare challenges facing the United States must be
confronted comprehensively with a common purpose, ingenuity, and
The necessity of healthcare in promoting health and preventing
disease, in treating the sick and rehabilitating the disabled, and in alle-
viating pain and suffering is universally accepted. For several decades,
however, inefficiencies and inequities in access to quality healthcare
have been well documented. Healthcare costs continue to rise, render-
ing them beyond the reach of the average citizen who is not insured by
a private or public program, and the number of the uninsured contin-
ues to climb. The escalating cost situation has been made more critical
by the current national economic distress, increasing unemployment
rates accompanied by loss of health insurance, and the growing eco-
nomic challenges facing healthcare institutions.
Recently, the role of information technologies, particularly elec-
tronic health records (EHRs), has received increasing attention and
emphasis as the means to improve the performance of the health
system through their promise to reduce redundant and unnecessary
medical tests, diminish medical errors, and improve clinical decision
making. While laudable and a potentially valuable element in contrib-
uting to an improvement in a selective sector of healthcare delivery,
the exclusive focus on the EHR as an end in itself may result in a
substantial increase in the cost of healthcare without addressing
the structural changes necessary to improve access to care, enhance
quality, and contain cost.
Whereas variations in the definition of telemedicine exist, there is
consensus on a broad conception of this field as the delivery of per-
sonal and nonpersonal health services and of consumer and provider
education as well as a means for safeguarding the living environment
via information and communication technology (ICT).
In our view, innovative telemedicine systems have already demon-
strated the potential to:
• Redress the inequities in access to all levels of health resources
(primary, secondary, and tertiary);
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• Enhance health system efficiency, clinical decision making, and
• Promote patient-centered care, at lower cost, and in local envi-
• Increase the effectiveness of chronic disease management in long-
term care institutions, and especially in the home environment.
• Promote individual adoption of healthy lifestyles and self-care.
Thus, the considerable promise of telemedicine in addressing
issues of quality, efficiency, cost, and access to care should be placed
at the forefront of our national effort to reform healthcare.
In this article, we present an analysis of the current problems facing
healthcare in the United States and the potential role of telemedicine in
addressing and alleviating them. Our purpose is to provide an impetus
for discussions pertaining to the significant role that telemedicine can
play in the development of effective healthcare reforms.
We also provide a cursory assessment of the current performance of
the U.S. healthcare system, the previous attempts at healthcare reform
and the underlying reasons for their limited success, and the role of
telemedicine as a necessary component in healthcare reform.
The Promise of Telemedicine
Our expectations for the positive role of telemedicine in healthcare
reform rest on its unique attributes and, more specifically, the manner
in which it addresses each of the following problems in healthcare
• The prevailing inequities in access to care that reflect geographic,
socioeconomic, and cultural disparities.
• The inefficiencies and limited coordination and integration of
complex systems of healthcare.
• The uneven distribution of quality of care, uneven adherence to
evidence-based medicine, high prevalence of medical errors, and
the wide adoption of unhealthy lifestyles.
The technology of telemedicine consists of electronic tools for the
acquisition, processing, dissemination, storage, retrieval, and exchange
of information aimed at promoting health and preventing disease,
treating the sick, rehabilitating the disabled, alleviating pain and
suffering, and protecting the public’s health and safety. The tradi-
tional boundaries between telemedicine, telehealth, and e-health have
become blurred, partly as a result of a general liberalizing trend in
modern society that normally starts with the nomenclature before it
becomes manifest in actual practice and partly because of the overlap-
ping functions between medicine and public health and their conver-
gence on using the same technology in this instance.
Over the last decade or so, the changes led by the digital revolution
have created a wave of new technologies that now pervade industrialized
societies as well as less developed ones. In turn, these technologies have
created pressures for changes in healthcare. For instance, the Internet has
spawned a wealth of health information at the fingertips of providers,
consumers, lay support groups, and special interests. It has also opened
vastly expanded opportunities for increased access to information and
sources of care that transcend the barriers of time and place.
Despite their immense promise, the diffusion of programs that rely
on ICT in healthcare delivery has been selective and slow. Whereas
large medical centers now rely on ICT in routine operations, such as
billing, scheduling, and communications, there has been a general
reluctance to broaden their applications to incorporate remote consul-
tations with colleagues located in other places, in-home monitoring of
chronically ill patients, triaging patients and coordinating their care
throughout the system, remote mentoring of colleagues in complex
surgical procedures, streamlining the clinical process between diagnos-
tic and clinical services, and integrating multisite delivery systems. All
of these are core functions in telemedicine.
Most medical centers are currently facing a perilous financial situation
from declining revenues. Some have found it expedient to reduce their
investment in ICT. Moreover, the prospect of providing additional services
via telemedicine is not inherently attractive to them because of signifi-
cant limitations and restrictions on reimbursement for these services. As
supported by scientific evidence, a fair reimbursement policy would
equate services delivered electronically to those delivered in person.
During the last two decades, the federal government has assumed
the dual role of supporting telemedicine projects and also placing
obstacles to the orderly deployment of sustainable programs. Several
federal agencies have provided substantial grant funding for project
start-ups and research in this field. At the same time, some federal
programs, such as the Veterans Administration, the Department of
Defense, and Bureau of Prisons, have adopted the use of telemedicine
in their operations. On the other hand, the Centers for Medicare and
Medicaid Services (formerly Healthcare Financing Administration)
have imposed significant restrictions on reimbursement. This has
hampered the diffusion of telemedicine nationwide since no medical
practice can be sustained without reliable recurring revenue.
In the current economic environment, it would be futile to propose
solutions in healthcare that simply add expenditures without having
a clear and explicit expectation of significant returns on investment.
Indeed, it would also be simplistic to assume that a single fix such
as a massive infusion of funds for building the IT infrastructure in
healthcare alone would result in a vastly improved health system that
is affordable and accessible.
© MARY ANN LIEBERT, INC. • VOL. 15 NO. 6 • JULY/AUGUST 2009 TELEMEDICINE and e-HEALTH 603
NATIONAL TELEMEDICINE INITIATIVES
Inequities in Access
One of the key attributes of telemedicine systems is electronic con-
nectivity, which transcends time and distance barriers. Newer advances
in this technology enable the acquisition, transmission, processing,
storage, and retrieval of vast amounts of information, including bio-
metric data, medical records, medical history, images, educational
material, and direct communication. With telemedicine technology,
patients have ready access to a series of geographically and function-
ally disparate providers without having to travel to distant places and
at times that are convenient for both patient and provider. Similarly,
providers have access to colleagues for consultation, clinical advice,
and guidance irrespective of where they live and work. Most of the
opportunity costs of care normally borne by patients and providers
(in travel, lost wages, and nonessential appointments, for example) are
diminished substantially, if not eliminated.
The uninsured and the underinsured will not directly benefit from
the introduction of telemedicine systems unless and until the cost sav-
ings are utilized to support structural changes to deal with this prob-
lem. The cost-savings would accrue from the use of explicit protocols
for patient triage, referral, treatment, and follow-up; from improved
efficiencies in patient self-management and informed decision-
making; and from the adoption of healthy lifestyles.
Health System Inefficiency
Telemedicine’s potential effects on health system efficiency derive
mostly from providing effective substitutions in locus and site of care,
provider, and setting. In addition, clinicians would be equipped with
clinical decision support systems, and multisite networks would be
given effective tools for integration.
In an ideal situation, patients would be able to receive the appro-
priate type and level of care they need, in proximity to their homes,
from the appropriate provider, and in the appropriate setting. Indeed,
an optimal and well-managed health system should not aim simply to
reduce use of service through pricing or other control mechanisms. It
should focus on encouraging appropriate use of care while discourag-
ing frivolous or inappropriate use. Thus, while there is wide consensus
that routine and self-limiting medical problems can be handled effec-
tively by nurse practitioners or primary care providers, and the use of
a specialist in most of these instances would be inappropriate, we have
yet to develop explicit protocols for triaging patients to the appropriate
sources of care from the outset, and for coordinating the process of care
as indicated by professional standards and patient needs. Telemedicine
provides the most effective tools available for achieving these goals.
Telemedicine technology also enables complex and multisite medi-
cal centers to achieve greater coordination, cohesion, and integration,
while assuring greater continuity of care for their patients and stream-
lining their clinical and administrative operations. It also reduces, if not
eliminates, specialist travel to outlying areas.
Integration of telemedicine with EHRs is essential for realizing the
full medical and economic benefits of both technologies. For providers,
ready access to patients’ presenting complaints and symptoms, medi-
cal history, and results from diagnostic tests would minimize medical
errors, duplication, and unnecessary tests and procedures. Moreover,
providers’ ready access to expert second opinion and to authoritative
sources of information relevant for the conditions under their care
would help them deliver more competent care in their home com-
munities. For patients, it represents an ideal situation whereby they
can receive the most competent care from their usual primary care
In summary, the available evidence to date clearly suggests that the
appropriate deployment of integrated telemedicine systems through-
out the country would have the potential to address the problems of
access, cost, and quality simultaneously. However, its success would
ultimately depend on our ability to build and support local, regional,
and national telemedicine networks, the removal of financial and
technical barriers to the use of telemedicine by the mainstream, and
the implementation of EHRs as part of these systems.
Telemedicine systems are neither designed nor intended as sub-
stitutes for the prevailing system of healthcare. When implemented
optimally, the tools of telemedicine complement the current system,
enabling it to operate with greater efficiency, effectiveness, outreach,
and shared responsibility.
Benefits of Telemedicine
The persistence of telemedicine in various forms and iterations over
a period of several decades attests to its usefulness, versatility, and
ever-expanding capabilities. The technological armamentarium for the
practice of telemedicine includes enormous capabilities from virtual
reality, to remotely operated robotics and haptic feedback devices, to
high-speed computers and broadband links.
This versatile technology has benefits as well as costs, but there is a
growing body of evidence demonstrating that the benefits far exceed
the cost, and these benefits accrue to providers, clients, and society at
large. For instance, telemedicine enables remote primary care provid-
ers to have ready access to expert colleagues at tertiary care centers.
Specialist providers at tertiary care centers can serve more effectively
a geographically dispersed patient population. Patients can receive an
appropriate level of care nearest to their homes. Society benefits from
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more rational shared decision making by consumers; effective substitu-
tions among sites of care; rational triaging of patients to appropriate
sources of care; and avoidance of unnecessary duplication and waste
in diagnostic services and clinical procedures. Patients presenting with
a variety of symptoms and problems can be triaged to the appropri-
ate provider, at the appropriate time and place. Rural hospitals can be
stabilized by their professional links to medical centers, thereby con-
tributing to the economic stability of rural communities. Physicians in
various practice locations can have ready access to efficient tools for
clinical decision making and to evidence-based medicine. Chronically
ill patients can be monitored in their home environments and given the
tools necessary for their maintenance and self-management. Average
citizens can be given access to the tools and educational resources for
adopting and maintaining healthy lifestyles. Also, large comprehensive
medical centers would be able to integrate their services across multiple
delivery sites and facilities.
The limitations of nonintegrated acute care systems, unstable insur-
ance schemes, and growing chronic illness in the population contribute
to the problem. Acknowledging these issues begs the question of how
to create a more effective system of care. Major government programs
in the distant and recent past have focused on efforts to integrate care
and contain costs, for example, through health planning and managed
care, but they have met with limited success. Other initiatives have
employed financial incentives to encourage better decision-making
and efficiency, also with disappointing results.
An Illustrative Case for Telemedicine:
Child and Adolescent Diabetes
The case for telemedicine can be best illustrated by focusing on a
single disease entity, such as diabetes. Today, diabetes is the sixth lead-
ing cause of death in the United States.1 The direct costs for the treat-
ment of diabetes in 2007 were estimated at $116 billion, and the total
direct and indirect costs were estimated at $174 billion.2 Over the last
several decades, concern for diabetes has extended to young children
(under 5 years of age—type I) and adolescents (6–17 years of age—type
II). This is one of the more important health issues facing this segment
of the population today, marking a major shift in the epidemiology of
childhood diseases.3 The American Diabetes Association recommends
that diabetic children should be cared for by a pediatric endocrinologist
(PE) as part of a diabetes management team.4
A state level study of the geographic distribution of PEs revealed
a 19-fold difference in observed ratios of obese children to PEs.3 For
example, Montana and Wyoming had no PEs. In Massachusetts, the
ratio of children to PE was lowest at 5,312:1, while in Mississippi it
was 99,984:1. Using Massachusetts as a reference (gold standard), an
estimated 1,500 additional PEs would be required and would need to
be geographically distributed proportionately across the states to assure
equitable access to their services. The authors contend that training
adult diabetes providers to care for adolescents with type II diabetes
is one option but a “reassessment of the current system of healthcare
delivery for obese children is needed, along with the creation of sus-
tainable models of care which can effectively improve health outcomes
for the large numbers of obese children at risk for development of
chronic diseases in childhood”.3
It is improbable that the requisite numbers and distribution of pedi-
atric and adult endocrinologists will be forthcoming. In all likelihood,
the current clustering of these specialties in major medical centers and
large cities will not change significantly, leaving millions of children
and adolescents at risk in medically underserved areas and among
medically underserved populations. Even in Massachusetts, of the 37
PEs in the state, 28 (76%) are located in Boston, 4 (11%) in Worcester,
and 3 (8%) in Springfield. The critical significance of the type of mal-
distribution is reflected in the higher prevalence of obesity in rural than
in urban counties, and among African Americans, American Indians,
and Alaska Natives.5 Certainly, in this and other similar situations, the
effective development of telemedicine can help redress the inequitable
distribution of specialists necessary to diagnose, treat, and manage
diabetes and related chronic diseases.
Evidence for telemedicine’s potential in this regard comes from
a number of sources. For example, a randomized control trial of
Medicare recipients with diabetes6 found that telemedicine case man-
agement using data capture from home monitoring devices improved
glycemic control, blood pressure levels, and total and low-density
lipoprotein cholesterol levels at 1 year of follow-up (all of which are
essential in the control of diabetes). In another study, diabetes educa-
tion via telemedicine was equally effective as in-person education in
improving glycemic control, and both methods were well accepted by
patients.7 Additionally, reduced diabetes-related stress was observed in
both groups. These studies demonstrate that telemedicine can be suc-
cessfully used to provide diabetes education to patients. In addition,
a pilot study of telemedicine technology to implement diabetes self-
management education for people with diabetes in underserved rural
communities in Arkansas determined that a significantly greater pro-
portion of participants demonstrated improved knowledge, endorsed
greater self-efficacy, and reported more frequent self-care practices
to manage their diabetes at the conclusion of the study period.8 This
example is applicable to a host of other chronic health problems,
including asthma, heart failure, pulmonary disease, and others.
In the example provided here, the observed link between obesity and
both types I and II diabetes for children and adolescents (as well as the
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latter for adults) points to the promise of telemedicine by contributing
to prevention through health behavior education as well as provision
of accessible diagnostic, treatment, and health maintenance services for
those with diabetes in medically underserved areas.
It is important to recognize that the health status of an individual
and of a population cannot be attributed solely to medical inter-
vention. Indeed, individual health status is the product of genetics/
biology, lifestyle, environmental quality, and medical intervention.
While it is difficult to ascertain the precise contribution of each
of these factors to health status, the role of medical intervention
in terms of enhancing preventive behavior as well as providing
diagnostic, therapeutic, and support functions is central. Moreover,
a truly effective plan for comprehensive healthcare reform must
incorporate the major determinants of health status that may be
amenable to change, especially when this can be accomplished at
a reasonable cost. An optimal health policy would use these deter-
minants as a rational basis for informed policy making in resource
allocation and accountability.
Telemedicine has the potential to intervene at a range of points
along the spectrum of health and illness behavior for many health
conditions. An appropriate starting point is educational program-
ming aimed at encouraging the adoption of preventive health
behaviors such as healthy diets and exercise, childhood and adult
vaccination, the use of screening programs for early detection and
treatment, informed decision making with regard to treatment
options, compliance with prescribed regimen, and supervised/self-
management in chronic disease management programs. We know
that by increasing accessibility to each of these programs, more
people will take advantage of them, resulting in notable improve-
ments in the health status of Americans.
As illustrated here, the United States has an obvious discrepancy
between expenditures and achievements in health. This discrepancy
has long been recognized, but we have yet to develop and adopt a
comprehensive strategy to address it. The current environment calls
for an innovative and sustainable national health policy that achieves
positive results in a cost-effective manner. The significant advantages
of telemedicine are clear. The following sections of this article provide
supporting evidence for our contention that there are serious problems
facing the current healthcare system today in the United States.
Problems in Health System Performance
The major problems in the health system of the United States are
continuing cost inflation, inequitable and uneven access to appropriate
and quality healthcare for large segments of the population, and the
practice of unhealthy lifestyles by many Americans.
In the aggregate, when measured by per capita expenditures, as
well as percentage of the gross domestic product† (GDP), U.S. health-
care expenditures have increased dramatically over the last several
decades, and are considerably higher than those of other developed
countries. In 1960, the total U.S. health expenditure was 5.2% of
the GDP. According to the most recent figures available, in 2007,
the total U.S. health expenditure as a proportion of the total GDP
was estimated at 16.3%. By 2017, should current trends continue,
healthcare spending is expected to reach just over $4.3 trillion, or
19.5% of the GDP.9 In terms of per capita expenditures, among 25
member countries of the Organization for Economic Cooperation
and Development (OECD) that have comparable accounting systems,
spending per person on healthcare in 2006 was highest in the United
States ($6,714) followed by Norway ($4,250). For comparison, the per
capita healthcare expenditure in Canada was $3, 678, about half that
of the United States.
Furthermore, in 2001, according to OECD data, the United States’
healthcare expenditures ranked highest in terms of purchasing-power-
parity international dollars (PPP$): $5,711.10 Switzerland—among
OECD countries most similar to the United States in organization and
financing of care—ranked second ($3,756), spending only 66% as much
as the United States. In terms of PPP$, Canada spent $2,982 or 52% of
the amount spent by the United States.
Cost and Quality
National and/or per-capita expenditures are often used in conjunc-
tion with selected indicators of a population’s health to reflect the
relationship between investment and achievement in health at the
national and international levels. While expenditure sources can be
identified and measured fairly reliably, there is always a problem of
attributing the health of the population to its appropriate sources. This
is because individual lifestyle and the quality of the living environment
have significant effects on people’s health in addition to the quality of
their health services.
The discrepancy between health expenditures and the two common
indicators of quality—life expectancy at birth and crude infant mortal-
ity rates—has been used to indict the U.S. health system.11 For example,
over the past several decades most OECD countries have experienced
substantial gains in life expectancy compared with modest increases in
expenditures over the past several decades. These trends have not been
matched in the United States, where life expectancy at birth increased
by 7.9 years between 1960 and 2005, compared to over 14 years in
Japan and 9.1 years in Canada during the same period. In 2005, life
expectancy in the United States was 77.8 years, almost 1 year below
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the OECD overall average of 78.6 years. According to the 2008 CIA
World Fact book, the U.S. ranks 45th in the world in life expectancy,
behind such places as Guam, Jordan, and Bosnia-Herzegovina.
Based on 2008 estimates of infant mortality among the 30 OECD
countries, the United States was tied with Poland and the Slovak
Republic for 26th place (at 6.9 deaths per 1,000). The infant mortality
rate for non-Hispanic black Americans is about 13.6 per 1,000 and 5.8
for non-Hispanic whites (NHWs). If only infant mortality of the NHWs is
considered, the United States ranking would improve to 22nd place.
It should be of considerable concern that the nation with the world’s
largest economy should trail so many less-developed countries in
important indicators of population health.12
Furthermore, the overall rates do not tell the full story. There is
considerable evidence illustrating the health experience diversity
among Americans and the impact on health status and mortality.
For example, a 2008 study conducted by Shugarman and associates
determined that among Medicare beneficiaries, there was no evidence
that lung cancer patients in rural areas had poorer survival rates than
those living in urban areas. Rather than rural versus urban residence,
individual (Medicaid versus Medicare coverage) and regional socioeco-
nomic factors (lower median income at the census tract level) and a
smaller supply of subspecialists per 10,000 individuals 65 years of age
and older were positively associated with a higher risk of mortality.
Nonetheless, rural residents were more likely to live in poorer areas
with a smaller supply of healthcare providers, and therefore were less
able to obtain needed care in a timely fashion. Similarly, a study of
rural–urban differences in the management of breast cancer concluded
that widespread use of state-of-the-art treatment would reduce mortal-
ity from breast cancer, and that differential access to state-of-the-art
care is associated with area of residence.13
Additionally, the United States scored lowest among OECD countries
with regard to safety. Thirteen percent of patients reported receiving
the wrong medication or wrong dosage; 15% of patients believed
a medical mistake was made in their treatment; 7% of hospitalized
patients reported having an infection acquired in the hospital; and
only 23% of doctors received computerized alerts or prompts about a
potential problem with drug overdose or interaction. The United States
also finished near the bottom in terms of the “patient-centeredness” of
care and the coordination of care between multiple providers. Patients
in the United States were most likely to visit an emergency department
for a condition that could have been treated by a primary care physi-
cian. However, once discharged, patients in the United States were less
likely to be re-hospitalized because of complications. Also, records and
test results were the least likely to reach a doctor’s office in time for an
appointment, and U.S. patients were more likely to be sent for duplicate
tests compared with patients in four of the other countries—United
Kingdom, New Zealand, Canada, and Australia.14
On the other hand, among the six OECD countries investigated in
this analysis, per capita expenditures on healthcare were highest in the
United States: nearly double those of Canada and Germany ($6,102
versus $3,165 and $3,005 respectively).14
Past Attempts to Reform the U.S. Health System
A number of factors have been suggested as reasons for the dis-
parity between expenditure and outcome in the U.S. health system.
These include the wide variety and quality of compensation and reim-
bursement modes; the greater market power of the supply side of the
health system that is reinforced by the highly fragmented organization
of healthcare financing; the complexity of private health insurance
schemes and associated high administrative overhead; the higher
incremental cost-benefits (research and development) of high-technol-
ogy medical care; and high, and sometimes exorbitant pharmaceutical
Historically, the basic structure and function of the health system
was established early in the last century. Hospitals became dominant
institutions because they facilitated the use of acute care technologies
such as X-rays, anesthesia, antisepsis, and surgical suites. However,
the cost of hospital-based acute care has continued to spiral to the
point of becoming unsustainable, while primary care has received
limited attention. Public health was systematically underfunded and
essentially separated from clinical care, focusing on environmentally
linked disease etiologies, such as sanitation, environmental sources,
and communicable disease as well as health behavior. Thus, clinical
interventions became the exclusive domain of medicine and medical
institutions, whereas health promotion and disease prevention became
the domain of public health.
Over the last century, considerable investment, sustained by
historical inertia, has fortified these healthcare institutions, making
them resistant to structural change and reform. Several attempts
at reforming this system through legislation have failed to resolve
long-standing problems. These have included (1) efforts to improve
the availability of resources in underserved areas through facility
construction; (2) medical education and training grants to attract
health providers to underserved areas; (3) attempts to enhance
health system efficiency and integration through regional programs
and health planning agencies; (4) increasing access to care through
entitlement programs; and (5) containing cost through prospective
reimbursement and managed care. All of these approaches had sub-
stantial merit, but none proved sustainable and sufficient to meet the
pressing national need for equitable access for all segments of the
© MARY ANN LIEBERT, INC. • VOL. 15 NO. 6 • JULY/AUGUST 2009 TELEMEDICINE and e-HEALTH 607
NATIONAL TELEMEDICINE INITIATIVES
population and for cost containment and universal quality assurance.
Consequently, these past initiatives have spawned an uncoordinated
system that is heavily focused on acute care, and increasingly over-
whelmed by underlying inefficiencies and unintended consequences.
The lessons learned from a history of patchwork reform should guide
current efforts to find optimal sustainable solutions. These historical
lessons can be summarized as follows:
1. The lack of a sustained national health initiative has created an
entrenched system at various levels—local, regional, and nation-
al—characterized by organizations with strong vested interests
in maintaining the status quo and resisting change. In addition,
frequently the clinical, administrative, and legal structures needed
in the past now create jurisdictional protections of inefficient
practices and institutions.
2. The lack of a coordinated system of care has resulted in wide
variations in clinical practice, discrepancies in adherence to
evidence-based standards, and wide variability in performance.
Moreover, some of the important lessons learned at some of the
leading medical centers have not spread to the rest of the system
because the paradigms of organizational or system change that
are successful in these institutions often fail when applied in less
sophisticated, rural, or simply different environments.
3. The task of reforming healthcare requires a systemwide approach
wherein different initiatives are blended to achieve explicit
goals. Limiting such efforts to a single fix, while maintaining
the status quo in all other aspects, is likely to have little impact
on major indicators of health system performance. Isolated solu-
tions that may have worked in certain organizations are likely
to face formidable barriers when they are implemented in other
institutions and settings. For example, the deployment of elec-
tronic medical records can be done as effectively and efficiently
on an intra-institutional or inter-institutional basis, but only
in the proper context. Moreover, as with most other processes
in the health system, the use of health information technology
should be linked with and closely tied to the intended changes
in performance objectives.
4. The unsuccessful and nonsustainable health policies of the past
cannot serve as an effective guide to meet current and/or future
challenges. It is time to confront our challenges as a nation and
as a people with ingenuity, creativity, renewed determination, and
Barriers to Health System Performance
One of the major attributes of the prevailing system of healthcare
delivery is the focus on acute and episodic care, and an unstable insur-
ance system that is linked to employment and hence subject to fluctua-
tions in the business cycle. Prevention is relegated to traditional public
health departments, but without a clear mandate and authority for pro-
tecting the health of the public, save for elementary public sanitation and
childhood immunization. The changing health needs of the population,
in conjunction with the emerging capabilities of information and com-
munication technology, now create an unprecedented opportunity to
rethink the priorities of the health system and to develop comprehensive
plans and optimal structures to achieve explicit national goals.
The following is a brief summary of the major problems in the cur-
rent system that calls for corrective action. They include fragmenta-
tion of care, limited attention to health promotion/disease prevention,
health resource shortage, structural problems in manpower, the medical
technology imperative, and changes in demographics and population
1. Fragmentation of care. Despite the growth of managed care,
much of the care that patients receive is episodic, with-
out effective means for coordinating the medical care process
over time and across providers; discontinuous, without the
necessary links and coordination between delivery sites and
resources; and it is inefficiently delivered without explicit pro-
tocols for sharing patient-relevant information and compli-
ance with evidence-based guidelines. This fragmented system
has been described as “a collection of bits and pieces.”16
The acute care paradigm that has been prominent in medi-
cine since the beginning of the last century was well served by
clinical professionalism, with individual autonomous decision
making and control of medical institutions. However, we now
need to consider the appropriate paradigm shifts in providing
health services to people to enhance efficiency and effectiveness
not only for providers and systems of care but also for clients,
patients, and their families.
2. Little concern with health promotion/disease prevention. It is widely
recognized that medical intervention is not the sole determinant
of the health of individuals and/or communities at large. Indeed,
the choices that people make in their daily lives and the quality of
the environment in which they live have direct impacts on their
health and ultimately the cost of their care. An ever-expanding
body of evidence points to limited or inconsistent public atten-
tion to healthy diets, physical activity, smoking avoidance, and
moderate drinking. For example, obesity rates among adults in
the United States doubled between 1980 and 2004. Obesity is
associated with increased risk for a number of conditions, includ-
ing diabetes mellitus, cardiovascular disease, hypertension and
certain cancers, and with increased risk of disability and a mod-
608 TELEMEDICINE and e-HEALTH JULY/AUGUST 2009
BASHSHUR AND SHANNON
estly elevated risk of all-cause mortality. In 2006, about 34% of
Americans (over 72 million) over 19 years of age were obese.17
About 21% of adults and about 13% of children (age 10–17)
smoke. The percentage for white children increases to 15%. The
teen birth rate is 40 per 1,000, and 13% of these births are pre-
term. Eight percent of all births are low weight; among blacks it
is 14%. Finally, only about one-half of adults participate in some
form of moderate or vigorous physical activity.18,19
3. Structural problems in health manpower. The greater emphasis
on acute care and medical specialization, along with institu-
tion-based care, took precedence over the country’s need for
primary care and preventive medicine. We have deviated from
the prescribed norm of roughly equal numbers of specialist and
generalist physicians. “One of the more entrenched physician
workforce concerns in the United States has been the limited
number of physicians in rural communities.”20 The limited num-
ber and wide geographic variation of pediatric endocrinologists
was discussed earlier. A similar situation exists for many, if not
all, clinical specialties. For example, great variation exists in the
geographic distribution of cardiologists and in numbers of car-
diac services provided across the United States.21 The importance
of this distribution is illustrated by a leading health economist,
Uwe Reinhardt, who notes that “no one knows what differences
in the quality of patients’ lives are associated with the stun-
ning geographic variations in practice style”.15 Wennberg and
colleagues suggested that the strongest predictor of per capita
consumption of cardiac services is the per capita distribution
of cardiologists. People with heart problems who live in medi-
cally underserved areas simply cannot get the care they need.
Another specialty with marked geographic maldistribution is
dermatology. Despite worries in the 1990s about an oversupply of
dermatologists, a 2002 survey on medical practice reported a rela-
tive shortage of these specialists, leading to long delay times in first
appointments ranging from 20 to 90 days.22 In 2004, conclusions
based on survey data on waiting times and other related issues
also reported an inadequate supply of dermatologists to meet the
demand for their services (Resneck and Kimball 2004). The aver-
age waiting time for the first appointment ranged from 18 days in
Mississippi to 66 days in Pennsylvania. Early diagnosis and treat-
ment of skin cancer is closely linked to successful outcomes.
Finally, for large segments of the U.S. population, mental
healthcare is frequently unavailable, or accessible with sub-
stantial difficulty. A survey of nonfederal psychiatrists in the
United States reported a 50-fold variation in the availability of
psychiatrists by state, measured as the ratio of psychiatrist to
100,000 individuals in the population. The lowest ratios were
in Alaska and Wyoming at 0.6 and 0.8, respectively, while
the highest were in Massachusetts and New York at 31.1 and
28.2, respectively.23 Moreover, a recent study reported that the
shortage of psychiatrists for children and adolescents remains,
adversely affecting those living in rural areas or in poverty.24
In short, we have failed to address the need for reaching par-
ity between primary care and specialists in the United States, and
the greater lure of specialization in medicine remains strong.
4. Demographics and population health. The aging of the popula-
tion and the attendant increase in chronic illness have expanded
the demand for care, while the adoption of unhealthy lifestyles
has exacerbated the problem. Approximately 75% of health costs
are attributable to chronic disease, a large percentage of which is
preventable but only when action is taken long before the onset
of the disease.
5. Wasteful spending in medical care. Despite disagreement about
the exact magnitude of the extent of wasteful spending in medi-
cal care, there is a general consensus that we are not getting the
greatest value for the amount spent. Recently, the president and
chief executive of the Mayo Clinic explained, “We are not get-
ting what we pay for. It’s just that simple.”25 Several decades of
research by Wennberg and colleagues have demonstrated wide
geographic discrepancies in the care that patients receive, and
factors other than need are important drivers of the system. For
example, according to Wennberg (2005), “It was immediately
apparent that suppliers were more important in driving demand
[for care] than previously realized.”26 An analysis of multiple
medical interventions suggests that due to asymmetries in the
accumulation of benefits, risks, and costs, clinical trials may over-
estimate the benefits and underestimate the risks and costs for
an individual submitting to multiple interventions. On the other
hand, Cutler et al. (2006) concluded that “Even taking wasted care
into account, the U.S. system as a whole is probably worth the
cost. The paradox of U.S. medical care is that a high total value of
care is combined with a significant amount of waste.”27
6. The dilemma of the technological imperative. Whereas advances
in medical technology and medical science have contributed to
saving lives and improving quality of life through sophisticated
diagnostic tools, improved surgical techniques, and a vast array
of therapeutic drugs, they have played a major role in raising the
cost of care. In many instances their development and utilization
have been guided largely by special interest groups and institu-
tions. Moreover, their benefits have not been distributed on the
basis of need. Increasingly, technological advances are beyond
© MARY ANN LIEBERT, INC. • VOL. 15 NO. 6 • JULY/AUGUST 2009 TELEMEDICINE and e-HEALTH 609
NATIONAL TELEMEDICINE INITIATIVES
the reach of many middle and lower income people because of
their high cost, as well as the high prevalence of un-insurance
and underinsurance in these populations.
7. The uninsured. Both the number and percentage of the unin-
sured and underinsured in the United States population have
been increasing, a problem rapidly and significantly exacerbated
by the current economic downturn. Unlike most developed and
developing countries, health insurance in the United States has
been linked to employment, especially after labor unions gained
this benefit through collective bargaining. Insurance status is a
significant determinant of use of service and ultimately health
status, since the uninsured tend to postpone or forego needed
care. When needed care is delayed, health problems may be
exacerbated and more expensive care may become necessary
with fewer health benefits for the individual concerned. While
this is a serious structural problem that must be addressed, it falls
beyond the scope of telemedicine, except insofar as telemedicine
may reduce certain costs. Some of the cost savings that may be
accrued from the use of telemedicine could be used to extend
coverage to the uninsured and underinsured.
While not a panacea, telemedicine offers significant opportunities
to address the issues of inequities in access to care, cost contain-
ment, and quality enhancement. Telemedicine not only provides the
potential to address structural issues of the health system, but it also
promotes transparency and evaluation to drive further improvement.
Telemedicine connections between primary care providers and special-
ists would lend greater economic benefits and social prestige to pri-
mary care. Patients would be less likely to get “lost” in the complexities
of fragmented and unconnected medical providers and health systems.
Instead, their care would be facilitated through an integrated and elec-
tronically connected medical care landscape across the entire country.
Ronald S. Weinstein, MD, discloses that he is a Co-founder, Board
member, and has equity in DMetrix, Inc. and is President, Chairman
of the Board, and has equity in UltraClinics, Inc. Jay H. Sanders,
MD, discloses the following entities that represent either existing
consulting clients and/or entities in which he has been provided
stock or stock options in which a conflict of interest either exists
or might be perceived: (1) AFrame Digital; (2) Kinetic Muscles, Inc.;
(3) Rivulet; (4) BiObex; (5) Compressus; (6) MedApps; (7) Emaginos;
(8) InTouch Health; (9) RMD Networks; (10) ATI; (11) iCons; (12)
Vesalius Ventures; (13) Flexible Medical Systems; (14) PhiloMetron;
(15) Sensitron; (16) InforMedix; (17) Emergency Medical Technologies,
and (18) TeleVital. Robert J. Waters, JD, discloses serving as Counsel
to the Center for Telehealth and E-Health Law and as Director of the
Home Care Technology Association of America. For all other authors
no competing financial interests exist.
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Address correspondence to:
Rashid L. Bashshur, Ph.D.
Telemedicine Resource Center
300 N Ingalls, 8 B 07, SPC 5402
Ann Arbor, MI 48109-5402
Received: May 26, 2009
Accepted: May 26, 2009
Rashid L. Bashshur, Ph.D.
Professor Emeritus of
Health Management and Policy
University of Michigan
Ann Arbor, MI
Gary W. Shannon, Ph.D.
Professor of Geography
University of Kentucky
Elizabeth A. Krupinski, Ph.D.
Research Professor of Radiology
University of Arizona
Jim Grigsby, Ph.D.
Professor of Psychology and Medicine
University of Colorado Denver
Joseph C. Kvedar, M.D.
Director, Center for Connected Health
and Associate Professor
Harvard Medical School
Ronald S. Weinstein, M.D.
Arizona Telemedicine Program
University of Arizona
Jay H. Sanders, M.D.
CEO, The Global Telemedicine Group
and Professor of Medicine (adjunct)
Johns Hopkins School of Medicine
Karen S. Rheuban, M.D.
Senior Associate Dean
University of Virginia Health System
Thomas S. Nesbitt, M.D.
Executive Associate Dean
UC Davis Health System
Dale C. Alverson, M.D.
Professor of Pediatrics and
University of New Mexico
Ronald C. Merrell, M.D.
Professor of Surgery
Virginia Commonwealth University
Jonathan D. Linkous
CEO, American Telemedicine
A. Stewart Ferguson, Ph.D.
Director of Telehealth
Alaska Native Tribal Health
Robert J. Waters, J.D.
Center for Telehealth and
Max E. Stachura, M.D.
Director, Center for Telehealth and
Professor of Medicine and
Medical College of Georgia
David G. Ellis, M.D.
Associate Professor of
State University of New York
Nina M. Antoniotti, Ph.D.
Director, Marshfield Clinic Telehealth
Barbara Johnston, M.S.N.
Medical Board of California
Charles R. Doarn, M.B.A.
Associate Professor of Surgery and
University of Cincinnati
Peter Yellowlees, M.D.
Professor of Psychiatry
UC Davis Health System
President, AMD Global Telemedicine
Vice President, Telehealth Services
Lehigh Valley Health Network
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