Tele-ICU Cost Benefit Analysis

The CEO of Omnicure, Sanjay Subramanian, MD, has a great deal of tele-ICU experience. His experience and leadership in critical care medicine have given him insight into cost and revenue centers in tele-ICU. As the prohibitive costs of legacy tele-ICU systems present a significant barrier, a primary motive of Omnicure is to provide a low-cost telemedicine ICU service.

In the 2019 publication, Telemedicine in the ICU [1], Sanjay co-authors a chapter titled “Cost Benefit Analysis of Implementing Telemedicine in the ICU.” Costs of tele-ICU are broken down into the following categories:

  • Hardware
    • Fixed mounted cameras in patient rooms
    • Cabling for cameras
    • Desktop computers and multiple monitors for remote physician/nursing workstations
    • T1 lines to assure connectivity
  • Software
  • Staffing costs

The chapter details the maintenance and support costs of hardware, as well as the staffing support of tele-ICU command centers. The hardware and IT costs are quite significant. For example, the hardware for in room audio-video equipment is cited as $7,500 per patient room, with an additional cost for installation.

In centralized models of tele-ICU, a command center is staffed by nurses and support staff in addition to tele-intensivists. While this auxiliary staff is necessary for upkeep of the command centers, in a decentralized model like that of Omnicure, a tele-intensivist works from home. There is no need for additional staffing and upkeep of a command center.

Revenue

Sanjay’s chapter contains extensive discussion of the financial benefits of tele-ICU, under the assumption that there is no insurance reimbursement. It is worth mentioning reimbursement for Telehealth is growing and is an anticipated source of revenue in the coming years.

Revenue is generated through increased volume, retaining more patients who may otherwise be transferred to outside facilities. Sanjay writes, “The added ICU occupancy can elevate the case mix index for the hospital which in turn has a positive effect on reimbursement.” The chapter also discusses cost avoidance subsequent to tele-ICU implementation, acknowledging that the literature has reported a variance in the extent. Cost avoidance is a result of fewer ICU complications, appropriate bed utilization, and reduced length of stay.

Sanjay analyzes tele-ICU literature on cost-effectiveness, finding a range of statistics. In one 2017 study by by Lilly et al. [2], “The capital costs of implementing a tele-ICU program (~$7 million)* were recuperated in roughly 3 months based on the improved net contribution margin of $30 million seen with the tele-ICU program. In addition to improved clinical outcomes, this study showed improved financial outcomes with an ICU telemedicine program.” 

* This figure includes set-up of a centralized command center and hardware in every patient room

The high cost can impede the adoption of tele-ICU. Omnicure aims to provide comprehensive tele-ICU services without capital costs that are deterrent.

Receiving hospitals report improved patient outcomes. These hospitals are able to generate revenue from a tele-ICU program through increased volume, retaining more patients who may otherwise be transferred to outside facilities. Sanjay writes, “The added ICU occupancy can elevate the case mix index for the hospital which in turn has a positive effect on reimbursement.” The chapter also discussed cost avoidance subsequent to tele-ICU implementation, acknowledging that the literature has reported a variance in the extent of cost reduction.

Across the board, studies have shown that tele-ICU programs result in improved patient outcomes, and decreased length of stay and ICU mortality. It is important to consider the cost and revenue centers, and develop a program that will minimize implementation costs while delivering a service that still results in improved patient care.

The impact of an ICU telemedicine program has the potential to be far reaching, both clinically and financially... The up-front capital investment in a tele-ICU program may be substantial, but through cost-effective care, the return on investment can be significant and realized quickly.

Sanjay Subramanian, MD
  1. Koenig, Matthew. Telemedicine in the ICU. Springer, 2019.
  2. Lilly CM, et al. ICU telemedicine program financial outcomes. Chest. 2017;151(2):286–97.

Innovating Critical Care

Omnicure was founded to innovate the delivery of critical care. Almost 3 years ago our team banded together to create an intuitive, simple, and mobile-friendly solution to provide tele-critical care with no hardware costs for the hospital.

Our primary motives?

  • The belief that healthcare as a whole can be improved through efficient allocation of physician resources.
  • The commitment to provide critical care expertise to settings without intensivists. Whether that is a Critical Access Hospital with a small ICU, or an ED where high-acuity patients wait to be transferred to a hospital bed, we set out to create a model that enabled bedside providers to easily connect with intensivists.

Sanjay Subramanian, a critical care physician in St. Louis, experienced the inefficiencies of legacy tele-ICU systems and considered the limitations. He saw an opportunity to make a positive change. Having previously practiced in Seattle, Sanjay reconnected with old friends and colleagues including Paramesh Vaidyanathan. Paramesh would go on to lead software development and become Omnicure’s CTO, with unique access to the tech talent of Seattle. Sanjay and fellow critical care colleagues helped guide product development, methodically designing workflows that would be natural and intuitive to providers.

Omnicure is an emerging force in tele-ICU, and more broadly provider-to-provider telemedicine. Our platform is nimble yet comprehensive. We knew the platform alone could help health systems better utilize intensivists to optimize their coverage. The next step was building a team of intensivists to provide coverage and consults to hospitals and systems that did not have critical care physicians in-house 24/7.

Intensivists loved the idea of providing remote coverage from home as opposed to the traditional centralized bunker locations associated with tele-ICU. We are still adding intensivists to prepare for additional coverage as we scale. If you are an intensivist reading this and want to learn more, don’t hesitate to contact us.

We are excited to have our new website up and running, and look forward to using this blog as a medium to discuss critical care, telemedicine, and all things healthcare.

Stay tuned as we work to bring critical care to new locations and strive to make a positive impact in healthcare through the use of our unique technology.