By Chris Gallagher, M.D.
Founder and Chief Strategy Officer, Access TeleCare
Healthcare affordability is on everyone’s mind right now. High-profile Congressional hearings over the last several months have featured executives from pharmaceutical manufacturers, insurance companies, advocacy groups and think tanks, and hospitals and health systems all explaining to lawmakers why healthcare costs continue to rise. Consumers, too, would like an answer. In a March Gallup poll, Americans cited the availability and cost of healthcare as their top domestic issue of concern, the first time since 2020.
How does telemedicine fit in?
While it cannot solve the multi-variable healthcare cost equation by itself, there is growing evidence that telemedicine is an effective tool at reducing barriers to timely specialty care and keeping healthcare cost growth in check.
Telemedicine Reduces Inter-Hospital Transfers
One way is by reducing the need to transfer patients between hospitals.
A patient arrives in the emergency department with stroke symptoms, respiratory failure, sepsis, a complex cardiac concern, or another condition that requires timely specialty input. The local care team may have the right nurses, imaging equipment, protocols, and bed capacity. What they may not have is the specialist needed at that exact moment to determine whether the patient can be cared for in his or her local hospital. That is where many transfers begin.
Some transfers are absolutely medically necessary. Patients who need advanced trauma care, burn care, neurosurgery, or another higher level of procedural or intensive specialty care should be moved to the tertiary or quaternary facility equipped to provide it.
But many transfers happen for a different reason: not because the patient’s condition dictates it, but because the hospital does not have timely access to the expert needed to make a diagnosis and direct a treatment plan.
The result is that interhospital transfer of patients has become a major pressure point in American health care and a significant cost driver.
ACEP Now reported that in 2023, emergency department transfer rates rose to 3.2%, about twice the rate in 2010. With roughly 160 million ED visits in 2023, that equates to about 5.1 million transfers a year from a hospital ED to another hospital, or nearly 14,000 patients a day.
EMS data show a similar burden from a different vantage point. The 2024 NEMSIS National EMS Data Report documented more than 60 million total EMS activations. Of those, 5,510,664 were hospital-to-hospital transfers, representing 9.1% of total EMS service requests.
The cost of these transfers is significant.
Each transfer costs about $5,100. For patients with health insurance, at least a portion of that cost is borne by their health plan, Medicare, or Medicaid. For patients without health insurance, that cost is the responsibility of the patient, or it becomes an unfunded charity care expense for the hospital.
Reducing these more than 5.1 million transfers by having specialty care available at the original hospital via telemedicine could save the healthcare system billions of dollars annually. Avoiding just half of these transfers would save more than $13 billion.
Transfers are already being avoided safely and effectively with hospital-based virtual care, and more transfers can be avoided with even greater adoption. One of the teleNeurology programs we deployed at a six-hospital regional health system resulted in a 60 percent reduction in transfers of neurology patients. Another partner, a rural hospital, saw a 36 percent decrease in patient transfers from its emergency department when it deployed a telePulmonology and Critical Care program. Still another decreased its outbound transfers by 15 percent when it deployed a virtual ICU with telePulmonology and Critical Care.
Telemedicine is Substitutive
There is also growing evidence to support the claim that telehealth is cost effective because it substitutes for in-person care. It doesn’t add to it.
In 2025, Access TeleCare contributed data to a groundbreaking report from the American Telemedicine Association’s Center of Digital Excellence showing that telehealth does not duplicate in-person visits or drive unnecessary utilization.
When done correctly, virtual care replaces … not duplicates … in-person care, improving timeliness of care and delivering cost savings. The analysis from the ATA of Medicare data in 25 states found that a 31-fold increase in virtual care visits increased Medicare utilization by just 0.25 visits per beneficiary.
Another just-published study in the journal Neurology looking at teleNeurology specifically found that there were no major overall differences in the number of subsequent neurology follow-up visits, neurologic emergency department visits, neurologic hospitalizations, all-cause emergency department visits, or all-cause hospitalizations following an in-person visit or a telemedicine visit.
Neurology follow-up within 90 days was nearly identical between the two groups: 24.6% for virtual visits and 23.7% for in-person visits. Neurologic emergency department visits within 90 days were also similar, at 0.9% for virtual visits and 0.8% for in-person visits. Neurologic hospitalizations were comparable as well, at 1.8% and 1.7%, respectively.
And, most recently, researchers at UCLA found that telemedicine has not led to increased use of medical care or higher healthcare costs. The findings validate telemedicine’s substitutive power across all payers.
With lawmakers looking for potential policy solutions to stem the growth in healthcare costs, telemedicine should be front and center as a proven means of bending the healthcare cost curve while enhancing access to care. Eliminating geographic barriers to timely specialty care reduces ED visits, hospitalizations, and readmissions. Telemedicine also reduces inter-hospital transfers, freeing up EMS capacity and avoiding EMS costs. It also delivers the same or better outcomes for patients, avoiding unnecessary duplicative or excessive downstream care.
