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Telemed faces funding pressure

January 12, 2006 | Caroline Broder, Contributing Editor
From the January 2006 print issue

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WASHINGTON – There are 35 telemedicine-related bills before Congress. However, prospects are slim that any of the bills will pass this year.

While there’s growing interest and support in federal circles for encouraging the use of electronic health records, telemedicine programs often struggle to gain the same level of recognition, says Jonathan Linkous, executive director of the American Telemedicine Association.

Although funding for telemedicine projects garners widespread enthusiasm on Capitol Hill, legislation supporting it is rarely approved in Congress, executives of the American Telemedicine Association complained at a meeting last month.

Additionally, grant money intended to spur telemedicine or telehealth initiatives continues to be limited, with some federal programs facing financial pressures. Such grants are important to telemedicine projects because of the high cost of startup and the challenges in building financially viable models.

Finally, a well-known telemedicine resource, the Telemedicine Information Exchange, has had its contract cancelled, has cut staff and is looking for alternative sources of funding.

“Love does not equal commitment,” Linkous told an audience at the American Telemedicine’s annual industry briefing.

Earlier this year, Sen. John Thune (R-S.D.) introduced an amendment to the 2006 HHS spending bill that would have provided $10 million in funding for telemedicine-related activities. The Senate approved the amendment, but a conference version of the bill cut the amount to $3 million. The HHS spending bill has not been approved. ATA leaders say the funding is a good first step and encouraged the association’s members to continue pushing for the funds.

Several signs also indicate that telemedicine is gaining incremental support within the government. First, the ATA estimates that $1.5 million of all Medicare payments are related to telemedicine services, up from $750,000 last year.

However, that’s still a fraction of a percent of the billions in dollars in claims paid by Medicare.

In addition, Quality Improvement Organizations, which are under contract with the Centers for Medicare and Medicaid Services to work in states to improve care, now are encouraging local healthcare agencies to develop home telehealth capabilities. The Veterans Health Administration uses more telemedicine services than any other government department or agency. In 2003, the VA delivered 350,000 services using telemedicine.

To be successful, Linkous said telemedicine needed a champion in the federal government similar to David Brailer, MD, who leads the Office of the National Coordinator for Health Information Technology.

By other measures, federal support for telemedicine has diminished in recent years. For example, the Bush Administration proposed cutting funding for telehealth efforts and closing the federal Office for the Advancement of Telehealth. In fiscal 2004, Congress did not appropriate sufficient funds to support new grants through OAT.

The Department of Agriculture also administers telemedicine grants, last month announcing 35 healthcare-related grants totaling $11.8 million for its Distance Learning and Telemedicine Program, designed to enhance educational and health services in rural areas.

The most recent round of grants is 57 percent more than the $7.5 million awarded to 22 telemedicine grants last year. Overall grants available through the program grew 20 percent last year, to a total of $29.4 million.

However, cutbacks are apparent in other areas. The Telemedicine Information Exchange, a Web site with a broad array of telemedicine information, lost its contract with the National Library of Medicine on Nov. 30.

The site, created and maintained by the Telemedicine Research Center, is now relying on donations, sponsorships and other sources of revenue to continue operation, said Josie Henderson, CEO of the Telemedicine Resource Center, which operates the site.

Related Topics:
  • January 2006
  • Congress
  • Jonathan Linkous
  • Medicare
  • telemedicine
  • Washington

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