Background: Not many analyses have been performed of the cost-effectiveness of telemedicine services. A teleradiology service linking a general practice in rural Norway up with the local hospital in the nearest town was established in 1998.
Methods: Savings on traveling expenditure were registered for all patients who underwent elective examinations in Otta during the first year of service. Over a four-month period in 2002, records were made of whether patients undergoing emergency examinations were taken in to the local general practice or referred to the hospital. These data are key factors in the evaluation of cost-effectiveness. The method employed is a cost-minimisation analysis in which the costs of teleradiology are compared to the costs incurred when patients go to hospital for a radiological examination.
Results: On the basis of data for 3006 patients, an estimated annual NOK 1.4 million (USD 200,000) were saved on travelling expenditures and by patients or their employers because of working hours not lost. Annual costs of NOK 50,000 were avoided because radiological examinations in the surgical out-patient clinic are no longer necessary. Annual costs of NOK 400,000 include investments in equipment, lease of a broadband connection, and less efficient utilization of equipment and surgeries. Examinations done twice incurred estimated annual costs of NOK 40,000. The cost-minimization analysis shows that on an annual basis the service saves costs of NOK 1 million (USD 160,000).
Interpretation: This study shows that telemedicine is most likely to be cost-effective when annual patient load and travel costs are high, together with relatively low investment costs.