A Telemedicine Opportunity or Distraction Benefit/cost, Is Strategies & Solutions

A Telemedicine Opportunity or Distraction

Benefit/Cost, IS Strategies & Solutions

Oscar Voigt

University of Houston-Victoria

MGMT_6352_23534

May 12, 2015

Table of Contents

• Executive Summary                                                                         3
• Case Synopsis                                                                         3-4
• Company’s Model & Business Goals                                                        5
• Major IS Strategy                                                                         5-6
• Firm Based Value Chain Model                                                         6
• Model Application                                                                        8-10
• Implementation Opportunity Analysis                                                10
• Implementation Effectiveness                                11-12
• Tangible Costs                                                                        12
• Tangible Benefits                                                                        13
• Intangible Costs                                                                         14
• Intangible Benefits                                                                         15
• IS and IT Strategy Recommendations                                                16
• Application & Functional Recommendations                                         17-18
• References                                                                                 19

Executive Summary

                Telemedicine as a health care IS tool has a barrage of benefits, costs, and applications suited for all industries, from pediatric care to critical care, but on the forefront of innovation is TeleStroke, a telemedical provider of acute stroke identification, diagnosis, and treatment. While the potentially lifesaving benefits of what TeleStroke offers far outweigh any financial burdens for some hospitals, numerous issues like aging IS/IT infrastructures and relatively high initial set up costs plague other potential or current spoke hospitals, like Mass General Hospital. Shared ownership of costs and value added activities from both hospitals and TeleStroke Services, coupled with savvy technological advances should alleviate any concerns about the cost-effectiveness of telemedical services to identify acute strokes.         

Case Synopsis

During this case Shawn Farrell, executive director of the TeleStroke program, calls on various interactions, experiences, statistics, and various medical and technical procedures to open up for discussion the controversial question: is Telemedicine an opportunity or a distraction? A nurse sparked Farrell’s interest in why they did not provide similar telemedicine consultation services as they do for stroke care. While TeleStroke services are the primary telemedicine focus of this case, it is not a brand new development, with over 50 other medical subspecialists using telemedical systems already. As the industry matured a trend of non-renewal of telemedical services due to subpar IT infrastructures and complex licensure issues become a major problem for many of the companies offering this service.  

After the merger, joining, and partnership of various tertiary care hospitals and health care institutions HealthCare TeleStroke Services first was realized as a lifesaving tool to help identify if a patient was having a stroke. Due to the failing geographic IS/IT of their clients, TeleStroke saw the lucrative opportunity to offer both the functional application of their products and services, like the TeleStroke System, but also the implementation of other IS/IT services, or what became known as TeleStroke Network Partners. Through gathering data, trial and error, and passing of key health care regulations the TeleStroke software developed to include decision support, clinical reporting, and was by 2011 used by 27 hospitals with some even having full time technical support employees just for this series. The procedures which lead to a TeleStroke consultation to the ones used shortly thereafter utilize various human, hardware, and software components in order to make educated decisions.  This saves lives and is cheaper than having a 24/7 stroke specialist on site, so why isn’t this service in every urgent care facility? An aging, complex, and at times incompatible or even duplicated IS/IT infrastructure at these hospitals was and still is the underlying reason. If this wasn’t bad enough, the rapid advancement of the IT/IS industry forced employees who were already limited on time to endure extensive technical training. Just like a critical error in the ER, a videoconference call error or a delay in a CT scan transfer can result in a loss of life, which is why TeleStroke launched a consulting service striking for guiding and helping set up other institutions’ telemedicine networks.

As TeleStroke expanded their services it became clear that their original business model, or their original reason for offering these services, of saving lives was a double edged sword. Meaning in their attempt of training, researching, and aggressively expanding their services, they might be distracting those institutions, doctors and nurses from saving lives instead of helping aid diagnosis. Through the organically developed need for an accurate and financially viable telemedicine service within the pediatric critical care industry, new issues gave rise to specific software, procedures, and most importantly pricing models. Other telling factors that resulted in an underdeveloped and easily swayed business model and therefore their goals, was TeleStroke’s early emphasis on short term priorities resulting in tunnel vision when structuring their revenue streams and incorporation of available IT/IS. You would think that hospitals which already had IT and IS infrastructures in place for the TeleStroke system would be ideal candidates for critical care tele pediatrics services, this however is not the case since processes were optimized for stroke care and not for other clinical diagnoses. It seems both spoke hospitals and telemedical services had reached a pivotal point of not being able to exist without one another to support their business goals.