In a country that made flying doctors famous, Telstra (ASX: TLS) is busy building the next phase of remote healthcare.
Telstra Health has already brought together a range of businesses offering:
- practice management applications for hospitals, pharmacies, aged-care facilities and GPs;
- 'connected care' software for sharing patient notes and prescription information;
- 'intelligence' tools to help professionals judge the efficacy of different treatments; and
- cloud-based remote monitoring of things like blood pressure and blood sugar levels.
On top of all this, Telstra's ReadyCare service allows patients in remote areas, or that otherwise find it hard to attend personally (such as the elderly), to 'talk directly with GPs over video or phone to receive advice, diagnosis, prescriptions and referrals'. The system also automatically shares treatment notes with a patient's usual GP to allow continuity of care.
The purchase last week of Anywhere Healthcare from Medibank extends this service to specialist care via video link, although patients will have to get themselves along to one of 1,600 GPs and aged-care providers that currently offer the service. With help on the ground from the local GP or practice nurse, patients will have access to specialists in over 30 different practice areas.
Of course we've seen it all before, in a multitude of sci-fi films, and that makes it easy to scoff. But these innovations will make a huge difference to the quality and cost of healthcare provision, particularly for those in remote areas.
Fair enough, then, for Telstra to shout it all from the rooftops, to build acceptance and use of the various services – but it's hard to see it moving the needle financially. Using the back of a hypothetical envelope, Australia has around 70,000 doctors, and if $10,000 a year was paid to Telstra in respect of every one of them, that would amount to revenues of $700m. Adding in the 257,000 nurses, also at $10,000 a year, would get you up to revenues of $3.3bn. Yet even this would amount to only 13% of Telstra's 2014 revenue.
We wish Telstra the best of luck with its 'eHealth' ambitions for obvious reasons, but investors hoping it will turn it into a 'growth stock' are likely to be disappointed.
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