Last Updated | October 18, 2024
The telemedicine business is quite competitive and regulated, making it difficult for organizations to establish themselves in this area. Whether you are an entrepreneur exploring the possibilities of entering this field or a healthcare provider who wants to make patient care more accessible, having a proper telemedicine business model is essential.
Telehealth is a strictly regulated field in a highly competitive market, and you must consider the driving aspects of the business model. Usually, it relies heavily on integrating telehealth software, including telepharmacy software, to facilitate remote consultations and medication management for patients in various healthcare settings.
Brief Overview
According to the Association of Healthcare Journalists report, the average wait time for a doctor’s appointment is 38 days; however, the exact numbers vary according to the location. Boston has an average wait time of 70 days, while Houston has 27 days, with some rural areas suffering due to no access to quality medical care. Patients in such areas either live too far away, have no means of travel to the healthcare center or do not have enough doctors to support the needs of people.
These situations create a significant gap between healthcare providers and patients, limiting them from accessing medical assistance. In such instances, nothing helps more than telemedicine platforms.
Custom telemedicine software development companies leverage technology to help healthcare providers and patients communicate with each other through tailored telemedicine software. This is why the telemedicine business has become an exceptional investment opportunity for startups, entrepreneurs, and patients, who are increasingly accepting telemedicine services due to their convenience.
Stay with us until the end to learn about the benefits and importance of a telemedicine business model and other insightful details.
Description of Telemedicine Business Model
This structure can also be referred to as the remote patient monitoring business model since it aims to mend the gaps between patients and healthcare providers in less accessible areas.
The basic telemedicine business model involves the telemedicine provider partnering with doctors practicing in various areas online, eliminating the geographic barrier. Once physicians are on the panel, they provide consultation through a virtual medium that allows them to listen, see, and speak to the patients.
Telemedicine improves OPD healthcare sessions by allowing doctors to see more patients quickly and conveniently without crowding a single room. However, the success of the telehealth business plan depends on the perception of the masses. This business model works because physicians can examine more patients in a short time and in remote areas.
Telemedicine gained significant popularity, which was evident through the success of e-clinics. Patients from remote areas view e-clinics as the preferred place to get services whenever they need medical attention. An adequately devised telemedicine business model and healthcare ERP systems provide quality healthcare without compromising affordability.
Read more: What are the different types of telemedicine?
How To Draft a Telemedicine Business Model?
A well-defined structure serves as a foundation for the success of a telemedicine business. Here is a step-wise guide to draft a standard telemedicine business model.
1. Identification of Target Audience
Drafting a telemedicine business model starts with identifying the targeted audience. Then, set goals regarding whom to reach with the telemedicine service, what pain points the telemedicine solution addresses, etc.
It is essential to specialize in a particular area of expertise and to devise the services accordingly.
Here is how it is done:
- Thorough Market Research: Conduct a comprehensive survey to understand the specific needs and preferences for healthcare of different target demographics. Then, work on the weaknesses and opportunities in current telemedicine options, especially in areas with high demand for healthcare/telemedicine services.
- Patient Profile: Create a semi-fictional patient profile to understand the target audience. Customize telemedicine applications according to factors like age, location, medical history, and goals. Telemedicine services should solve their specific challenges and provide better care.
2. Choosing a Specialization
Telemedicine is an umbrella term that encompasses a wide range of services. Therefore, a successful telemedicine business model should have features aligning with the target audience to create a loyal customer base.
3. Competitive Analysis Market Position
A competitive edge in the telemedicine business model requires a thorough understanding of competitors. Analyze their strengths and weaknesses to emerge as a better option for people.
- Competitor analysis: Identification and research of other telemedicine applications or providers. Understand their market share, strengths, and weaknesses. Find opportunities to develop an app with existing services and something unique.
- Develop a Unique Selling Proposition (USP): Based on the competitive analysis, explain what makes your telemedicine service better than others. Make sure to jot down factors like pricing, customer service, user experience, or any other feature that gives you an edge over the competitors.
- Craft Compelling Brand Messaging: Always keep communication transparent. Highlight the benefits like cost savings, improved healthcare, convenience, etc.
4. Pricing Strategies
Multiple revenue streams for a telemedicine business are available to choose from; some common options include:
- Direct patient payments: Patients are charged a fee for each telemedicine consultation or service. This form of revenue stream, known as the pay-per-use model, is the most common route for any telemedicine business.
- Subscription: Patients can pay a monthly or annual subscription fee to access the telemedicine service.
- Data monetization: The telemedicine service forms a pool of data regarding the patients that are sellable to other businesses or used to develop new products or services. However, following HIPAA rules and federal laws for sharing sensitive information in the healthcare industry is critical since patient data privacy is heavily regulated.
Online Doctor Consultation Revenue (Global)
Implementing a Telemedicine Business Model: Challenges and Solution
Executing a telehealth business plan can be challenging. To make it a success, a strong application is needed that easily connects patients with doctors through the internet. As a telemedicine software development company, you must implement the telemedicine app correctly.
Here are some common challenges associated with implementing the telemedicine business model.
Higher Costs
Usually, telemedicine can cost a lot. While most products in the market start from $1000, some are on the lesser side and can cost around $100 with add-on charges. Clients often fail to understand the reason behind high pricing and try to negotiate a lower cost. It is important to make them understand that the cheaper solutions aren’t user-friendly and must be integrated with multiple add-ons to offer the right features.
Solution: Transparent communication about the features offered to justify the cost and flexible payment options.
More on: Telemedicine startup cost.
License Requirements
Every state and country has unique licensure requirements and regulations for healthcare solutions. Telemedicine can easily cross state lines, leading to penalties if not handled correctly.
Solution: The solution is to familiarize with the legalities to avoid issues in the future.
Integration with EMR
One of the most significant challenges is integrating telemedicine with an EMR system. Most telemedicine services are designed to integrate easily with an EMR, but a few are still unable to offer the solution. EMR integration and healthcare app development involve acquiring and storing patient information from previous visits.
Solution: To overcome this issue, companies must collaborate with doctors to create telemedicine software for EMR integration. This will ensure that doctors have access to the latest patient records and provide the most reliable healthcare services.
5 Tips for Successfully Launching a Telemedicine Company
Telemedicine companies need to ensure compliance with state-centric and HIPAA standards. For this reason, before you put up a telehealth business for sale, consider the following points;
- Consider the telemedicine laws in your country or state, as they differ from area to area. In addition, cross-check the reimbursement policies for future ease.
- Understanding the market position after analyzing the key competitors and their pricing is crucial for a telehealth business to thrive. Check what they offer and set a balanced price that gives you an edge and attracts the right business partners.
- Always do your homework and have complete information about the features. For instance, if you want to offer asynchronous communication, you have to provide secure data storage, while solutions needed for diagnostics need HD images.
- Define the customer segment and identify the business goals. It’s important to add uniqueness to your services and focus on solving the socioeconomic problem. Consider how your tech solutions will drive profit and define a revenue stream because all of them have different pricing models.
- Make an action plan that includes the business development activities.
More scoop on: How to start a telemedicine practice?
Benefits of Telemedicine for Patients and Providers
Most healthcare organizations are already yielding benefits from reliable healthcare UX design and healthcare integration with digital systems. They have significantly reduced adverse incidents and improved efficiency.
The use of telemedicine applications is optimizing chronic health maintenance and preventative care management. There are various direct and indirect benefits of telemedicine for patients and doctors, such as:
Improved Access to Specialist Care
Most patients in rural areas cannot access specialist healthcare due to traveling issues or the absence of a healthcare facility. In addition, doctors may have limited ways of communicating with patients who need healthcare. That is why developing a medical app with a telemedicine feature is essential.
Lower Expenses & Costs
A telehealth business has the direct benefit of reducing healthcare costs. Travel and transport expenses and the need for a hospital stay will be eliminated, saving energy costs for healthcare institutes.
Better Health Outcomes
Telemedicine services improve patient engagement, which significantly improves healthcare outcomes. Research has shown that telemedicine reduced re-admissions among patients with heart failure by 21.05% during COVID-19.
Increased Efficiency
Telemedicine cannot replace in-person treatment because it only enhances the doctor-patient relationship. Doctors can provide in-person appointments but also offer flexibility and convenience for follow-up visits, checkups, and awareness sessions through telemedicine.
Explore: Telemedicine benefits
Connect With Folio3 Digital Health To Develop a HIPAA-Compliant Telemedicine Software
Digitalization has improved the healthcare sector considerably, and telemedicine services are now accepted significantly. You can connect with us to discuss how we can develop a tailored solution to incorporate telemedicine into your healthcare practice. Whether you need to develop telemedicine chatbots or other tools, Folio3 Digital Health has you covered. Our team of designers, developers, and marketers can bring your vision to life and even offer post-deployment maintenance. With extensive experience, Folio3 Digital Health has everything you need to develop HIPAA-compliant products that use HL7 and FHIR interoperability standards.
Conclusion
Adopting a telemedicine business model has become critical for many healthcare organizations and patients who want cost savings, convenience, and higher accessibility. On the other hand, healthcare providers like the reduction in overhead costs and the flexibility to work. For this reason, it’s the right time to jump into the industry, but make sure you have a solid business plan and are compliant.
Frequently Asked Questions
How Can Telemedicine Be Used to Improve Patient Outcomes?
Patients no longer need to travel far distances to get the required healthcare services. In addition, they can attend awareness sessions, which help them better manage their medical conditions.
What Are the Potential Benefits of Telemedicine for Both Patients and Providers?
Telemedicine eliminates transportation costs, saves time, and eliminates elder care or childcare issues. It also provides quick access to medical specialists and eliminates long waiting times.
What Are The 5 W’s Of a Telemedicine Business Model?
The telemedicine business model is complex as patient-doctor communication, provision of medical services, and medical education depend on it. In addition, it’s a high-risk business, which is why you have to consider the five W’s of the telemedicine business, which are as follows:
- Who will be impacted if your telemedicine business fails or telemedicine software stops working?
- What types of medical conditions and patients need telemedicine services the most?
- When does having inoperative equipment affect your business’s ability to run at full capacity?
- Where do you want to provide the services?
- Why are you starting the telemedicine business and offering the software?
About the Author
Abdul Moiz Nadeem
Abdul Moiz Nadeem specializes in driving digital transformation in healthcare through innovative technology solutions. With an extensive experience and strong background in product management, Moiz has successfully managed the product development and delivery of health platforms that improve patient care, optimize workflows, and reduce operational costs. At Folio3, Moiz collaborates with cross-functional teams to build healthcare solutions that comply with industry standards like HIPAA and HL7, helping providers achieve better outcomes through technology
