Telehealth Initiative and Economic Opportunity in Houston

Paper Info
Page count 4
Word count 1157
Read time 5 min
Topic Health
Type Essay
Language 🇺🇸 US

Telehealth is a business initiative in the sphere of healthcare aimed at socially or economically marginalized populations and those who do not have full access to healthcare. Even though the idea of using telecommunication technologies in healthcare is assumed to be cost-effective, some financial and other risks still exist and should be carefully analyzed. In this paper, different aspects of the initiative are presented and discussed.

A virtual hospital visit system is believed to bring financial advantages to healthcare organizations. In general, public health interventions provide a substantial return on investment, and preventive measures are considered more effective than treatment (Masters et al., 2017). Therefore, Memorial Hermann Health System (MHHS) aims to provide underserved communities with access to virtual healthcare. Reducing the number of emergency department (ED) visits would allow hospitals to save financial and time resources. However, possible economic risks can be connected with installing and maintaining Telehealth software and training healthcare providers. At the same time, in the long term, financial opportunities seem to overweight the risks, which makes Telehealth a promising initiative.

Since the Telehealth target audience includes racial minorities, immigrants, and other populations with a different cultural background, there can be certain risks connected with misunderstandings in communication. The language barrier and difference in beliefs and traditional health practices are some of the possible problems preventing a medical specialist from providing timely, high-quality care. Therefore, these risks can be mitigated through culture-competency training of the personnel, where the healthcare ethical standards, such as the principles of inclusiveness and diversity, should be underlined (Johnson & Davey, 2019). Codes of ethics issued by different governmental health agencies, such as Health Resources and Service Administration and Food and Drug Administration, may serve as examples of solutions (Johnson & Davey, 2019). These official documents may include guidelines for employees and management, addressing ethical behavior principles.

A priority of any medical organization is to provide healthcare based on the overall equality, which means that all patients should be equally respected regardless of their cultural, social, and economic background. Therefore, the proposed solutions do not disadvantage any particular groups of patients. Respect and equality in healthcare settings guarantee mutual understanding and the full engagement of patients into the process of a virtual hospital visit. These principles are likely to influence the MHHS economic growth because they may increase the number of successful Telehealth sessions, and consequently, fewer ED visits. Therefore, MHHS should inform and prepare medical personnel to possible cultural differences and language barriers in communication with patients. Moreover, healthcare providers should understand the basics of ethical behavior and accept the diversity of the target audience.

Introducing Telehealth in MHHS is a complicated process, which requires a comprehensive evaluation of potential financial risks and benefits. Cost-effectiveness analysis is aimed to “allow decision makers to clearly understand the tradeoffs of costs, harms, and benefits between alternative treatments” (Sanders et al., 2019, p. 1400). In the present paper, Telehealth pre-hospital care and traditional hospital visit are compared from the financial perspective. The approximate calculations presented in the analysis refer to one hospital of average size and are based on the recent study evaluating the cost-effectiveness of Telehealth (Langabeer et al., 2017). In particular, the researchers found 376 fewer emergency cases among Telehealth patients and considered medical personnel salaries and ambulance costs as variables to measure the effectiveness (Langabeer et al., 2017). Since sufficient time is needed to adapt to the system, the benefits are likely to be insignificant during the first several years after launching Telehealth.

The cost-benefit analysis presented in Appendix (Table 1) demonstrates that the financial benefits of the initiative overweighs its costs. However, since virtual healthcare requires special software, new equipment, and personnel training, launching the system may be the most expensive process. Besides, the initiative may not bring immediate benefit since the overall community health is the result of long-term preventive care. However, in a five-year perspective, the organization’s expenses are likely to decrease because fewer resources will be spent on personnel training and equipment purchase. Simultaneously, the first savings and positive results will become more evident in five-years-time. Therefore, this analysis may help MHHS evaluate whether the implementation of the proposed measures is feasible. The results demonstrate the initial investment amount and allow deciding if the initiative is affordable or can be postponed.

Most of the expenditure presented in the analysis, such as software and technical support expenses, is fixed. However, it is possible to control and even reduce the costs of personnel training. Creating a comprehensive educational program and assigning experienced health providers with good computer skills would save time and resources on teaching them how to use Telehealth tools. Besides, misunderstanding is possible not only between a patient and a healthcare provider but also within a team of employees (Gogia et al., 2016). Therefore, the training should include the basics of organizational ethics aimed at improving the interpersonal relations of team members. In this case, healthcare provision could be more effective and coordinated, and further costs would only include personnel assessment and training of new employees. Moreover, well-trained, culturally competent medical specialists are more likely to understand their patients and provide high-quality care, increasing ED visit savings.

An effective strategy of maximizing benefits includes upgrading Telehealth equipment. Since the system is highly dependent on IT technologies, timely maintenance and improvement are necessary for the successful healthcare provision (Gogia et al., 2016). Therefore, careful handling of the equipment should be underlined as a requirement for healthcare providers. At the same time, all these measures can be implemented on the condition of the overall respect and equality. For example, the deliberate underserving of patients to reduce ED visits is untenable regardless of their economic and social background.

The ideas presented in this paper are based on reliable sources, including qualitative and quantitative research. The academic works by Masters et al. (2017) and Sanders et al. (2019) demonstrate the cost-effectiveness of medical initiatives, which can also be applicable for MHHS settings. The qualitative study by Langabeer et al. (2017) served as a foundation of cost-effectiveness calculations associated with the present business case. Finally, qualitative research by Johnson and Davey (2019) and Gogia et al. (2016) allowed proposing economic initiatives based on ethical healthcare principles and general aspects of Telehealth. Johnson and Davey (2019) discussed ethics-related measures of other organizations, which were used as examples. Finally, the studies by Langabeer et al. (2017) and Gogia et al. (2016) allowed formulating economic and non-financial solutions. The combination of the facts and assumptions helped evaluate existing ideas and propose relevant business initiatives.

In conclusion, this paper presents the financial and ethical risks and opportunities of the Telehealth system. Even though it is difficult to indicate precise numbers, approximate calculations demonstrate that using telecommunications in pre-hospital care is a promising initiative. Besides financial opportunities, it may improve the overall community well-being. At the same time, careful action planning and control over expenses are necessary to provide both successful and cost-efficient healthcare.


Johnson, J. A., & Davey, K. S. (2019). Essentials of managing public health organizations. Jones & Bartlett Learning.

Gogia, S. B, Maeder, A., Mars, M., Hartvigsen, G., Basu, A., & Abbott, P. (2016). Unintended consequences of Tele Health and their possible solutions. Yearbook of Medical Informatics, 25(1), 41–46. Web.

Masters, R, Anwar, E., Collins, B., Cookson, R., & Capewell, S. (2017). Return on investment of public health interventions: A systematic review. Epidemiology & Community Health, 71(8), 827–834. Web.

Langabeer, J. R., Champagne-Langabeer, T., Alqusairi, D., Kim, J., Jackson, A., Persse, D., & Gonzalez, M. (2017). Cost–benefit analysis of Telehealth in pre-hospital care. Journal of Telemedicine and Telecare, 23(8), 747–751. Web.

Sanders, G. D., Maciejewski, M. L., & Basu, A. (2019). Overview of cost-effectiveness analysis. JAMA, 321(14), 1400-1401. Web.


Cost-Effectiveness Analysis

Table 1. Telehealth Cost-Benefit Analysis.

Costs Current Year (CY) CY +1 CY +2 CY +3 CY +4 CY +5 Total Costs
Installing Telehealth software $10000
Personnel training and examination $2000 $500 $500 $500 $500 $500
Equipment costs (tablets, PCs) $50000 $500 $500 $500 $500 $500
Technical support and maintenance $1000 $2000 $2000 $2000 $2000 $2000
Total Costs (Future Value) $63000 $3000 $3000 $3000 $3000 $3000
Total Costs (Present Value) $63000 $2941,18 $2883,51 $2826,97 $2771,54 $2717,
Benefits Current Year (CY) CY +1 CY +2 CY +3 CY +4 CY +5 Total Benefits
Savings on paramedic/
physician salaries
$25000 $60000 $70000 $80000 $80000 $80000
Savings on ambulance transportation costs $5000 $10000 $15000 $20000 $20000 $20000
Total Benefits (Future Value) $30000 $70000 $85000 $100000 $100000 $100000
Total Benefits (Present Value) $30000 $68627,
$92 384,54 $90 573,08 $457516,
Present Value Discount Rate 2%
PV Denominator 1,00 1,02 1,04 1,06 1,08 1,10
Net Benefit $380376,

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EssaysInCollege. (2022, May 24). Telehealth Initiative and Economic Opportunity in Houston. Retrieved from


EssaysInCollege. (2022, May 24). Telehealth Initiative and Economic Opportunity in Houston.

Work Cited

"Telehealth Initiative and Economic Opportunity in Houston." EssaysInCollege, 24 May 2022,


EssaysInCollege. (2022) 'Telehealth Initiative and Economic Opportunity in Houston'. 24 May.


EssaysInCollege. 2022. "Telehealth Initiative and Economic Opportunity in Houston." May 24, 2022.

1. EssaysInCollege. "Telehealth Initiative and Economic Opportunity in Houston." May 24, 2022.


EssaysInCollege. "Telehealth Initiative and Economic Opportunity in Houston." May 24, 2022.