Cost savings from a telemedicine model of care in northern Queensland, Australia

OBJECTIVE: To conduct a cost analysis of a telemedicine model for cancer care (teleoncology) in northern Queensland, Australia, compared with the usual model of care from the perspective of the Townsville and other participating hospital and health services. DESIGN: Retrospective cost-savings analysis; and a one-way sensitivity analysis performed to test the robustness of findings in net savings. PARTICIPANTS AND SETTING: Records of all patients managed by means of teleoncology at the Townsville Cancer Centre (TCC) and its six rural satellite centres in northern Queensland, Australia between 1 March 2007 and 30 November 2011. MAIN OUTCOME MEASURES: Costs for set-up and staffing to manage the service, and savings from avoidance of travel expenses for specialist oncologists, patients and their escorts, and for aeromedical retrievals. RESULTS: There were 605 teleoncology consultations with 147 patients over 56 months, at a total cost of 442 276. The cost for project establishment was 36 000, equipment/maintenance was 143 271, and staff was 261 520. The estimated travel expense avoided was 762 394; this figure included the costs of travel for patients and escorts of 658 760, aeromedical retrievals of 52 400 and travel for specialists of 47 634, as well as an estimate of accommodation costs for a proportion of patients of 3600. This resulted in a net saving of 320 118. Costs would have to increase by 72% to negate the savings. CONCLUSION: The teleoncology model of care at the TCC resulted in net savings, mainly due to avoidance of travel costs. Such savings could be redirected to enhancing rural resources and service capabilities. This teleoncology model is applicable to geographically distant areas requiring lengthy travel.