Third Way Analysis Shows that Bipartisan, Bicameral Legislation Expanding Telehealth Services Saves Money While Improving Care

February 03, 2016

Telehealth is a win-win for budget hawks and patient advocates

WASHINGTON – Today, Third Way came out in strong support for innovative telehealth legislation introduced by Senators Brian Schatz (D-HI), Roger Wicker (R-MS), Thad Cochran (R-MS), Ben Cardin (D-MD), John Thune (R-SD), and Mark Warner (D-VA) and by Representatives Diane Black (R-TN), Peter Welch (D-VT), and Gregg Harper (R-MS). The CONNECT for Health Act would improve access to health care through video technology and other modern communication tools by changing Medicare’s payment policy for these services. This effort builds off of Third Way’s analysis conducted by Avalere Health that shows the legislation would save Medicare $1.8 billion over ten years through reduced hospitalizations and better management of chronic diseases.

“The key to savings in the CONNECT for Health Act is a new payment policy for remote patient monitoring, a type of innovative service that allows health care providers to receive regular and automated reports about how people with a chronic disease are doing at home,” said Third Way Senior Fellow for Health and Fiscal Policy David Kendall. “The reports can come from something as simple as a daily, automated phone call to the person’s home or something more sophisticated, like an internet-enabled scale or blood pressure cuff. Providers can monitor changes in a person’s condition and intervene quickly if something goes wrong. By acting before a crisis occurs, people with a chronic disease can avoid a trip to the hospital and taxpayers can avoid the expense.”

In conjunction with release of the CONNECT for Health Act, Third Way is also releasing an analysis by the Actuarial Research Corporation that shows additional savings potential for the legislation. If the CONNECT for Health Act approach were applied to the rest of the health care system, projected national health care spending would fall by $7.5 billion over the next ten years as the result of reduced hospitalizations and better management of chronic diseases. Medicaid, in particular, stands to save nearly $1 billion.

This legislative approach, cutting waste in health care by directly improving the patient experience, is part of a series of 15 policies Third Way has released over the past year. Our proposals come from innovative ideas pioneered by health care professionals and organizations, and show how to scale successful pilots from red and blue states.


For more information about the Avalere analysis, please Caroline Pearson, Senior Vice President, Policy & Strategy, at or (202) 446-2271. The contact for the Actuarial Research Corporation analysis is James W. Mays, President, at or (703) 941-7400 ext 26.

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