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Innovations such as telemedicine would improve health care system efficiency

Montreal, September 16, 2010 – Innovations such as telemedicine are a way of improving the efficiency of the health care system and enhancing the choices offered to patients. In an Economic Note published today by the Montreal Economic Institute (MEI), the authors say the current government monopoly in the health care sector has the adverse effect of eliminating most natural incentives for innovation and optimal use of resources. These characteristics are necessary, however, to promote the advance of new models of care like telemedicine.

“Quebec has lost ground in telehealth,” stated Nathalie Elgrably-Lévy, a lecturer at HEC Montréal and senior economist at the MEI. “Initiatives taken up to now seem to have favoured collaboration between professionals rather than the provision of services to patients.”

The authors present a number of successful North American telemedicine experiences. Various forms of telemedicine are examined, among them telephone consultation, virtual clinics and telehomecare. Telehomecare, which consists of sending physiological information remotely for control and follow-up purposes, is especially promising for patients suffering from chronic illnesses.

The Economic Note and its appendix look at two experiences in more detail, one at Maisonneuve-Rosemont, a public hospital in Montreal, and the other at Kaiser Permanente, a non-profit organization in California, for patients suffering from a chronic pulmonary disease. In both cases, telehomecare has enabled nurses to look after more patients while providing care of the same quality. This has helped reduce costs substantially once the equipment is amortized. Cost reductions ranging from 13% at Maisonneuve-Rosemont to 42% at Kaiser Permanente have been observed.

“The bureaucratic and centralized nature of Canada’s public health care system is among the reasons it has taken only its first timid steps in telemedicine,” explained Germain Belzile, director of research at the MEI. “And yet, we can see that this is an innovation that would lead to more care for patients while using less resources.”

The complete Economic Note prepared by Nathalie Elgrably-Lévy and Germain Belzile, titled Telemedicine: improving the health care system through innovation, may be consulted free of charge on the Institute’s website.

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The Montreal Economic Institute (MEI) is an independent, non-partisan, non-profit research and educational organization. Through studies and conferences, the MEI informs public debates in Quebec and Canada by suggesting wealth-generating reforms based on market mechanisms.

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Information and interview requests: Ariane Gauthier, communications coordinator, Montreal Economic Institute Tel.: 514 273-0969 ext. 2231 / Cell: 514 603-8746 / E-mail: agauthier (@iedm.org)

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