Revenue in the telehealth services industry is expected to grow by an annualized 30.7 percent to $320.2 million in the next five years, including revenue growth of 23.1 percent in 2014, according to industry research firm IBISWorld.
It defines telehealth services to include diagnosis, treatment, assessment, monitoring, communication and education delivered primarily through three kinds of technology: videoconferencing, remote patient monitoring and store-and-forward offerings, which transmit digital images between providers.
Advances such as wearable self-monitoring devices and digitized medical scans are propelling the rapid growth, along with skyrocketing costs, a looming doctor shortage and an aging population, according to an announcement.
"Over the next five years, the industry will continue to benefit from the demographic and structural factors affecting the healthcare industry as telehealth will emerge as a cost-effective solution to meeting the medical needs of an expanding and aging population," says IBISWorld industry analyst Stephen Morea in the announcement.
Existing legislation, such as the Affordable Care Act, and pending legislation to expand federal reimbursement for telehealth services will further boost the industry, according to the report.
Companies' difficulty in finding the talent they need for product and software development poses an impediment to the industry, Morea notes, as does the need to develop systems that do not violate existing patents. Nevertheless, he predicts growth in the number of enterprises entering the market.
While Medicare's 2014 physician fee schedule expands coverage for telehealth services, the American Telemedicine Association (ATA) is pushing for further removal of what it calls "unnecessary" limitations on Medicare providers.
A bill expanding coverage for members of the military passed in January and a similar bill allowing Medicare providers to practice across state lines passed the House last fall.
Meanwhile, states are pushing adoption of telehealth through "parity" laws requiring equal coverage as that offered through in-person visits.