Time is of the essence in the agricultural industry, given the short window of opportunity to harvest fruits and vegetables in their peak condition. When workers feel under the weather from a cold or stomach virus, they typically have to drive a long distance to a medical clinic or hospital emergency room for treatment. Time is spent waiting in the facility. An entire day’s work can be squandered.


Telemedicine is on-demand healthcare provided remotely by a doctor or other medical specialist.

Employees with non-life-threatening illnesses communicate their concerns to a medical specialist, who prescribes treatment.

The online consultation may involve video, phone, photos, a written exchange—or all of the above.


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Who Are Some of the Providers?

Finding the Right Partner

United Agricultural Benefits Trust (known as UnitedAg) is familiar with the productivity pains caused by an employee’s lost time from work. The associated healthcare plan, composed of more than 700 agricultural employer groups with 42,000 members spread across California’s vast agricultural industry, sought a way for workers to receive more expeditious care at the same or higher quality and at lower employer cost.

Telemedicine (also called telehealth) was the solution.

“Our members didn’t have good access to healthcare in the rural environments where they worked,” says Christopher McDonald, UnitedAg’s chief innovation officer. “They also tend to carpool to work. This meant someone feeling ill might not have a car to drive to a clinic. So they end up taking a full day off for a medical condition that could easily be addressed with a simple prescription.”

UnitedAg signed a contract with Teladoc, one of the top telemedicine providers in the fast-growing virtual healthcare space. Telemedicine is on-demand healthcare provided remotely by a doctor, nurse practitioner, registered nurse or other medical specialist. Access is within minutes. Employees with a bad headache, bladder infection or more than 50 other low-acuity (read: non-life-threatening) illnesses log onto an application and communicate their concerns to a medical specialist, who prescribes treatment.

Depending on the telemedicine provider, the back-and-forth online consultation may involve video (like Skype), a phone conversation with uploaded photos, a question-and-answer written exchange—or all of the above.

Not only is this fast-track process more humane for the injured or ill employee, it may sharply reduce the cost of employer-provided healthcare.

“By deferring a visit to an emergency room or a walk-in clinic, hundreds of dollars are shaved off each time,” says Peter McClennen, Teladoc’s president.

Add up those deferred visits, and companies with a large employee population can save a bundle. Other employer benefits include reduced absenteeism and a related uptick in productivity.

“Telemedicine also makes employees feel their employer values them, which increases their engagement levels, improving job retention,” says Aamir Rehman, M.D. and head of clinical services for the United States at employee benefits provider Mercer.

So it’s small wonder that virtual healthcare is taking off. According to Mercer, 71% of employers with 500 or more employees offered telemedicine services in 2017, up sharply from the 59% that offered the services in 2016. “It’s just exploding,” Rehman says.

Spiraling out of Control

Today’s healthcare system is in disarray, with competing agendas in Congress and no clear consensus on an optimal solution. “The volume of research papers today on healthcare is outsized—literally hundreds of papers published per day,” McClennen says.

Meanwhile, the average total health benefit expense per employee keeps creeping up for employers—from 2.4% of revenues in 2016 to 2.6% in 2017. Deductibles in traditional preferred provider organization plans also continue to rise, reaching nearly $1,000 on average in 2017 for employers with 500 or more employees and nearly $2,000 for companies with 10 to 499 employees.

Other examples of rising healthcare costs include:

  • Americans pay $858 on average for their prescriptions, compared to $400 per person across 19 other industrialized nations.
  • Doctor-dispensed drugs cost 60% to 300% more than medicines distributed at retail pharmacies.
  • Average annual salaries for nearly all physician specialties increased between 11% and 21% in 2016.
  • The cost of emergency room visits can reach well into the thousands of dollars.
  • Many ER visits are unnecessary, the medical condition easily treated with over-the-counter medications or a visit to a less expensive walk-in clinic.
  • Nearly half (46%) of physicians mandated by law to digitize patient records have spent more than $100,000 each to implement an electronic health record system.

Eight years ago, a company like ours didn’t exist, but neither did Uber. The world is changing. We’re able to bring all the pieces involved in patient care to employees in an automated, mobile way, making access to care easier and more satisfying.

Peter McClennen, President, Teladoc

These various expenses trickle down to affect the overall cost of healthcare for employers and everybody else. Telemedicine offers a way to trim the excess fat, while providing much-valued access and convenience to employees.

Tomorrow’s Healthcare Today

Think of telemedicine as a walk-in clinic without the walking. By all accounts, it appears to be the least expensive option to treat many low-acuity ailments such as bronchitis, athlete’s foot, deer tick bites, pink eye, laryngitis, and sinus, yeast and ear infections. That’s because employees don’t have to make a time-consuming trip to the ER, a walk-in clinic or a doctor’s office to treat such conditions.

“A key driver of telemedicine is to prevent overuse of the ER,” says Tim Smith, a principal at Deloitte, where he is the national leader for the consulting firm’s healthcare information technology practice. “If someone needs a prescription for penicillin because they have a rash, the person does not need to sit for three hours in an emergency room to be handed a piece of paper. With telemedicine, a doctor or nurse practitioner can immediately diagnose the rash and route the prescription to a local pharmacy for the person to pick up at lunch or on the way home from work.”

Telemedicine also puts injured or ill employees in the driver’s seat when it comes to their care. “Historically, if I wanted to see my doctor, I had to make an appointment when it was convenient for the doctor,” Rehman says. “With telemedicine, the doctor sees me at my convenience. For employees at work, this is a great alternative. They don’t have to leave work, drive to the care provider, and wait around in a waiting room for who knows how long. The physical barrier to providing care has been removed.”

Many telemedicine providers offer services beyond low-acuity medical conditions, such as providing dermatology and psychological care. Although the companies price their services differently, most charge a specific fee for a consultation with a medical specialist. UnitedAg, for instance, receives electronic data from Teladoc notifying it that one of its employee members consulted with the provider.

“The fee is well under what a regular doctor’s office or clinic charges,” says McDonald. “We also paid a one-time fee to set up the exchange between their system and ours.” He preferred to keep these amounts proprietary, noting they were negotiated with Teladoc.

The big question about telemedicine is whether the quality of care is on par with or better or worse than seeing a physician in person. Rehman seems to lean toward “on par.”

“As a doctor, when a patient comes to me with a sore throat, I examine the person to see if there might be something else going on,” he explains. “This might indicate that a physical visit is superior to a virtual one.

But we’ve surveyed our clients’ employees about this, and the reality is their doctors spend very little time with them in the examination room. It was painful for me as a physician to read these responses.”

He adds, “The reality is that with telemedicine, patients aren’t giving up much, since their doctors tend to give them so little time anyway.”

Telemedicine, in fact, may be a better alternative to walk-in clinics.

“The quality of care in telemedicine outpaces brick-and-mortar clinics because everything is documented,” Rehman says. “If the patient is prescribed a medication, that person’s personal physician and healthcare provider receive this information electronically. Not all walk-in clinics have this capability.”

That’s not good. Rehman provided an example of a patient who receives a prescription from a nurse practitioner at a walk-in clinic that may exceed the dosage the person’s physician would have recommended, given the patient’s other medical conditions and prescriptions.

“With telemedicine, the patient’s personal physician is alerted immediately to the new prescription, whereas this may fall through the cracks at a clinic,” Rehman says. “If there is a problem, it can be quickly discerned and solved.”

The quality of care in telemedicine outpaces brick-and-mortar clinics because everything is documented. If the patient is prescribed a medication, that person’s personal physician and healthcare provider receive this information electronically. Not all walk-in clinics have this capability.

Aamir Rehman, M.D. and head of clinical services for the United States, Mercer

Several studies indicate virtual care has its plusses and minuses. A 2016 Rand Corporation study indicated the ease of telemedicine consultations actually resulted in overuse, increasing the use of healthcare. A 2013 study published in the Archives of Internal Medicine, comparing telemedicine with face-to-face examinations of patients with sinusitis and urinary tract infections, confirmed the traditional benefits of telemedicine—convenience, avoidance of travel time, and lower costs—but found that telemedicine providers had prescribed antibiotics at a higher rate for sinusitis than did other doctors. And the benefit of antibiotics for sinusitis is unclear.

One can argue this research is four years old—antiquated given today’s blistering pace of technological development. In the interim, video sharing, digital technology and data analytics software have improved markedly, possibly moderating the tendency to overprescribe.

A New Service Line of Business

Telemedicine appears to be a cost-effective and highly valued employee benefit for insurance brokers to present to commercial clients.

“We’re very bullish on this concept of delivering healthcare, as I am personally,” says Deloitte’s Smith. “The technology now exists for patients to have much more interactive conversations with quality caregivers using video and other visual tools. Ten years from now, sitting in a waiting room will be passé.”

Many brokers are already partnering with a telemedicine provider (or several) to offer the product to clients. Aon is a case in point.

“The future of healthcare will be driven by people taking ownership of their well-being, and telemedicine enables this type of behavior,” says Ted Cadmus, senior vice president and a local practice leader in Aon’s health and benefits practice. “Right now too many people go to the ER for things like a sinus infection or a cold, which eats up capital and human resources and does tremendous disservice to the individual…. Telemedicine fits beautifully in our fast-paced, mobile technology world.”

Teladoc’s McClennen agrees that brokers have a lot to gain from presenting telemedicine as an additional employee benefit.

“Undoubtedly, the early movers will have a leading edge, given the trend toward virtual care,” he says. “Eight years ago, a company like ours didn’t exist, but neither did Uber. The world is changing. We’re able to bring all the pieces involved in patient care to employees in an automated, mobile way, making access to care easier and more satisfying.”

While Cadmus believes younger employees are most likely to pursue virtual interactions with care providers, in time every employee will do the same.

“Some older baby boomers who are used to face-to-face doctor visits might still prefer that form of interaction,” he says, “but as they retire, telemedicine and other forms of virtual healthcare, like remote monitoring of patients, will be the primary means for treating diverse medical conditions.”

By remote monitoring, Cadmus is referring to digital technologies that collect medical data from individuals remotely to interpret and monitor their heart rate, blood pressure, blood sugar and other personal health data. Like telemedicine, this component of virtual healthcare is predicated upon reducing visits and readmissions to an ER, clinic or doctor’s office, improving patient quality of life while containing costs across the continuum of care.

These savings can be substantial. Mercer’s study indicates a typical telemedicine consultation costs less than $50, whereas the average office visit costs about $125. And a 2017 study by the online journal Value in Health suggests telemedicine consultations at the University of California Davis saved patients nearly nine years of travel time, five million miles and $3 million in costs.

Another study by Accenture found 78% of consumers are interested in receiving virtual health services. A study by Deloitte came to a similar conclusion, finding 74% would use telemedicine services if they were available at work. Meanwhile, 70% of the respondents said they were “comfortable” with consulting about their medical issue with a medical specialist via text, email or video.

Employers are not deaf to this growing interest. About 90% of large employers said they would offer telemedicine as part of their employee health plans in 2017, according to a 2016 National Business Group on Health survey. Altogether, the virtual healthcare market is expected to reach $3.5 billion in revenues by 2020.

The future of healthcare will be driven by people taking ownership of their well-being, and telemedicine enables this type of behavior.

Ted Cadmus, senior vice president, Aon

“Healthcare is fast becoming one of the most automated industries in the world, making care easier to access and less expensive to acquire,” says McClennen.

All this makes telemedicine an enticing opportunity for brokers. Clients can obtain the aforementioned benefits—increased employee engagement, higher workforce productivity, improved care quality and lower healthcare use—at a much lower cost.

“Depending on the health plan provided by the employer, telemedicine may be a free add-on,” Cadmus says.

Aon has brokered deals for multiple commercial clients involving telemedicine providers Teladoc and American Well. “Which provider we choose depends on the client’s healthcare plan,” says Cadmus. “American Well may be right for one client, whereas another telemedicine provider may be right for a different client. We’re not locked in to any one of them. We play the role of third-party expert for our clients, identifying the solution that’s best for their employee population.”

For this service, Aon receives a commission from the provider on the dollars of business placed, although the firm also has charged fees, depending on the arrangement.

“This isn’t about money anyway,” Cadmus maintains. “The motivating force for us is to clearly demonstrate (to clients) that we’re thinking ahead toward their best interests—always in front of the next technological curve. Right now telemedicine fits this bill.”

Banham is a Pulitzer Prize-nominated author and insurance journalist. russ@russbanham.com