Introduction: Population-level algorithm-enabled remote patient monitoring (RPM) based on continuous glucose monitor (CGM) data review has been shown to improve clinical outcomes in diabetes patients, especially children. However, existing reimbursement models are geared towards the direct provision of clinic care, not population health management. We developed a financial model to assist pediatric type 1 diabetes (T1D) clinics design financially sustainable RPM programs based on algorithm-enabled review of CGM data.
Methods: Data were gathered from a weekly RPM program for 302 pediatric patients with T1D at Lucile Packard Children’s Hospital. We created a customizable financial model to calculate the yearly marginal costs and revenues of providing diabetes education. We consider a baseline or status quo scenario and compare it to two different care delivery scenarios, in which routine appointments are supplemented with algorithm-enabled, flexible, message-based contacts delivered according to patient need. We use the model to estimate the minimum reimbursement rate needed for telemedicine contacts to maintain revenue-neutrality and not suffer an adverse impact to the bottom line.
Results: The financial model estimates that in both scenarios, an average reimbursement rate of roughly $10.00 USD per telehealth interaction would be sufficient to maintain revenue-neutrality. Algorithm-enabled RPM could potentially be billed for using existing RPM CPT codes and lead to margin expansion.
Conclusion: We designed a model which evaluates the financial impact of adopting algorithm-enabled RPM in a pediatric endocrinology clinic serving T1D patients. This model establishes a clear threshold reimbursement value for maintaining revenue-neutrality, as well as an estimate of potential RPM reimbursement revenue which could be billed for. It may serve as a useful financial-planning tool for a pediatric T1D clinic seeking to leverage algorithm-enabled RPM to provide flexible, more timely interventions to its patients.