Healthcare CFOs: Telehealth Does Not Improve Overall Financial Picture
New research based on interviews with rural healthcare CFOs showed that they see some financial value in telehealth but do not believe it improved their hospitals' financial situations.
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By - A recent study from the American Journal of Managed Care (AJMC) found that healthcare chief financial officers (CFOs) believe that despite some financial advantages, telehealth did not improve the overarching financial situations in their rural facilities.
According to the Centers for Disease Control and Prevention (CDC), telehealth has the potential to effectively provide communication and counseling for patients, as well as reduce barriers to care for those who live far away from healthcare services.
Additionally, a study from June found that telehealth is an effective alternative to in-person care for rural residents, ultimately leading to higher appointment completion rates. Although certain individuals, such as new patients and older adults, were less likely to use telehealth, the study found that telehealth led to 20 percent higher appointment completion rates.
However, the study published in AJMC aimed to gauge information regarding how telehealth impacts hospital finances, along with understanding the challenges that CFOs face in decision-making.
From October 2021 to January 2022, researchers led semi-constructed interviews with 20 CFOs of rural hospitals in 10 states. The interviews were focused on basic hospital information, existing telehealth programs in the emergency department, inpatient, and outpatient settings, perceptions about the financial impact of each program, the drivers of the financial effects, the role of telehealth in strategic planning operations, and policy and other barriers to the financial sustainability of telehealth.
Of the 20 CFOs who participated in the interview process, 17 represented critical access hospitals, and three represented short-term acute care hospitals. Also, 16 led hospitals with 25 or fewer beds, and 10 oversaw hospitals that had faced a financial loss within the three years prior.
Based on the interviews, researchers found that even though the CFOs believed telehealth has certain advantages financially, they did not think that it led to overall improvements in the financial situations of hospitals. Rather, the interviews indicated that the more central benefits of telehealth in rural hospitals related to improving care quality and addressing patient needs.
CFOs also described that low reimbursement, limited volumes, preferences for in-person care, and insufficient internet broadband were the most apparent financial challenges to telehealth use.
However, aside from these results, the study shows that understanding how CFOs think about telehealth ROI can be useful in determining how to boost the use of virtual care in rural areas. Policymakers could use this information to develop sustainable rural telehealth policies.
The research also found that CFOs may benefit from guidance on promising practices and cost-effective implementation methods.
The research comes amid mounting financial losses among US healthcare organizations, particularly rural facilities, in the wake of the COVID-19 pandemic.
A report from May found that many rural hospital locations are battling the potential risk of closure due to financial issues. Among the 2,176 hospitals the study reviewed, 441 faced three or more financial risk factors linked to the potential of closure. Some of the risk factors that the hospitals faced were negative total operating margins, negative operating margins on patient services, negative current net assets, and negative total net assets, according to the report.
