Results
Cost comparison
Pre-Intervention Period (November 2017 – February 2020)
Before the intervention, in-person clinical psychology services showed a mean benefit paid of AU$98,199.5 (SD = 12,275) per 100,000 and a median (Q1, Q3) of AU$100,899 (93,024.5, 106,368.8) per 100,000. Psychology in-person services had a mean (SD) of AU$79,385.1 (9,670.6) and a median (Q1, Q3) of AU$81,710 (74,573.8, 86,065.8). Video consultations for MMM 4-7 had clinical psychology services mean (SD) costs of AU$169.5 (112) and psychology a mean (SD) of AU$117.9 (63.6), with respective medians of AU$128.5 and AU$112.5 (Table 1).
Post-Intervention Period (March 2020 – June 2022)
Post-intervention, in-person clinical psychology services showed a reduced mean benefit paid of AU$71,325.2 (SD = 14,804.7) and a median of AU$73,512.5 (Q1 = 61,343.8, Q3 = 78,740). Psychology in-person services had a mean of AU$62,901 (SD = 11,849.6) and a median of AU$65,226.5 (Q1 = 57,365.8, Q3 = 68,939). Video services for MMM 4-7 exhibited increased benefits for clinical psychology (mean = AU$1,557.6, SD = 371.8) and psychology (mean = AU$1,313.5, SD = 347.5), with higher respective medians (Table 1).
Table 1: Results of descriptive analysis of benefits paid per 100,000 for mental and allied healthcare services in Australia, Nov 2017 to Jun 2022.
Statistic Pre-Intervention (AU$) Post-Intervention (AU$) T-Statistic P value
Clinical Psychology <br />
In-Person Services <br />
Mean (SD) 98199.5 (12275) 71325.2 (14804.7) 7.39 <0.001
Median (Q1, Q3) 100899 (93024.5, 106368.8) 73512.5 (61343.8, 78740) <br />
Video Services for MMM 4-7 <br />
Mean (SD) 169.5 (112) 1557.6 (371.8) -18.92 <0.001
Median (Q1, Q3) 128.5 (78.2, 272.8) 1470.5 (1334, 1821) <br />
Video Services for General Population (no geographical restrictions) <br />
Mean (SD) 25,066.8 (8,590.6) <br />
Median (Q1, Q3) 26,178 (18,060.8, 30,616.5) <br />
Phone Services for General Population (no geographical restrictions) <br />
Mean (SD) 8,212.4 (3,449.7) <br />
Median (Q1, Q3) 7,314.5 (5,923.2, 9,264.5) <br />
Psychology <br />
In-Person Services <br />
Mean (SD) 79385.1 (9670.6) 62901(11849.6) 5.7 <0.001
Median (Q1, Q3) 81710 (74573.8, 86065.8) 65226.5 (57365.8, 68939) <br />
Video Services for MMM 4-7 only <br />
Mean (SD) 117.9 (63.6) 1313.5 (347.5) -17.91 <0.001
Median (Q1, Q3) 112.5 (65.8, 158.8) 1256.5 (1105.5, 1557.5) <br />
Video Services for General Population (no geographical restrictions) <br />
Mean (SD) 16,887.4 (5,937.5) <br />
Median (Q1, Q3) 17,802 (12,945.8, 20,287.2) <br />
Phone Services for General Population (no geographical restrictions) <br />
Mean (SD) 7,173.6 (2,915.2) <br />
Median (Q1, Q3) 6,381.5 (5,326.5, 8,582.2)
Telehealth utilisation impact
The utilisation of services across the three periods (March 2020 - February 2021, March 2021 - February 2022, and March 2022 - February 2023) varied significantly (Table 2). For Clinical Psychology, in-person services showed stable Utilisation across all periods, with no significant differences (F = 0.08, p = 0.927). Video services for MMM 4-7 displayed a significant increase in usage over time (F = 5.27, p = 0.010), while video services for the general population exhibited consistent Utilisation without significant changes (F = 0.35, p = 0.705). Phone services for the general population decreased significantly across the study period (F = 5.20, p = 0.011). In Psychology, in-person services demonstrated steady usage across all periods with no significant differences (F = 0.13, p = 0.879). Video services for MMM 4-7 experienced a significant rise in Utilisation (F = 8.49, p = 0.001), whereas video services for the general population remained stable (F = 0.40, p = 0.673) (Table 2, Appendices 2A-E).
Table 2: Service Utilisation Trends and related costs for Clinical Psychology and Psychology Services, by Consultation Mode (March 2020– February 2023)
Service Period Mean (SD) Median (Q1, Q3) F-Statistic P-Value Mean (SD) Median (Q1, Q3) F-Statistic P-Value
No. of Services Offered Per 100,000 Benefits Paid (AUD) Per 100,000 <br />
Clinical Psychology <br />
In-Person Services March 2020 - February 2021 541 (110) 566 (453, 589) 0.08 0.927 <br />
March 2021 - February 2022 525 (141) 504 (455, 640) <br />
March 2022 - February 2023 527 (69) 529 (493, 567) <br />
Video Services for MMM 4-7 March 2020 - February 2021 10 (2) 10 (10, 11) 5.27 0.01 1304.0 (276.9) 1333.5 (1224.8, 1440.8) 9.27 0.001
March 2021 - February 2022 12 (2) 12 (11, 13) 1647.8 (295.5) 1603.0 (1395.5, 1824.3) <br />
March 2022 - February 2023 13 (2) 13 (11, 14) 1787.1 (275.7) 1777.0 (1619.8, 1954.3) <br />
Psychology <br />
In-Person Services March 2020 - February 2021 665 (119) 699 (588, 721) 0.13 0.879 <br />
March 2021 - February 2022 689 (164) 677 (601, 817) <br />
March 2022 - February 2023 687 (84) 701 (650, 751) <br />
Video Services for MMM 4-7 March 2020 - February 2021 12 (3) 12 (11, 13) 8.49 0.001 1064.8 (258.8) 1084.5 (998.5, 1230.5) 11.97 <0.001
March 2021 - February 2022 15 (2) 15 (13, 16) 1411.9 (271.4) 1355.5 (1175.3, 1559.3) <br />
March 2022 - February 2023 16 (3) 16 (15, 18) 1546.5 (212.4) 1525.5 (1462.3, 1666.0)
Cost trends
Interrupted time series analysis (ITSA)
Interrupted time series analysis (ITSA) revealed distinct trends in healthcare costs pre- and post-intervention. An immediate reduction in total costs was observed following the intervention in March 2020 (Table 3). The Interrupted Time Series analysis for Clinical Psychology revealed an intercept of -2.83 (95% CI [-156.59, 150.92], p = 0.971), a pre-intervention trend of 12.76 per month (95% CI [2.99, 22.54], p = 0.011), and a post-intervention trend change of 16.08 per month (95% CI [2.26, 29.9], p = 0.023). For Psychology, the intercept was 16.62 (95% CI [-122.22, 155.45], p = 0.811), and trend change 20.48 (95% CI [8, 32.96], p = 0.002).
The intervention increased costs for video-based services: Clinical Psychology by +29,874 (actual: 45,337; counterfactual: 15,463) and Psychology by +22,834 (actual: 38,297; counterfactual: 15,463), reflecting expanded Utilisation post-intervention (Figure 1).
Residual diagnostics confirmed the model's validity, with no significant patterns suggesting autocorrelation. Seasonal adjustments accounted for cyclical variations, ensuring observed changes were attributed to the intervention.
Figure 1: ITS Analysis with Counterfactuals for Clinical Psychology and Psychology Video Services
Table 3: Interrupted Time Series Model Results for Clinical Psychology and Psychology Video Services (Nov 2017-Jun 2022)
Variable Coefficient (β) Standard Error t-value p-value 95% CI
Clinical Psychology <br />
Intercept (Baseline Level) -2.83 76.62 -0.04 0.971 [-156.59, 150.92]
Time (Trend Pre-Intervention) 12.76 4.87 2.62 0.011 [2.99, 22.54]
Intervention (Immediate Effect) 363.33 219.71 1.65 0.104 [-77.56, 804.22]
Time x Post-intervention 16.08 6.89 2.33 0.023 [2.26, 29.90]
Psychology <br />
Intercept (Baseline Level) 16.62 69.19 0.24 0.811 [-122.22, 155.45]
Time (Trend Pre-Intervention) 7.5 4.4 1.71 0.094 [-1.33, 16.32]
Intervention (Immediate Effect) 135.93 198.39 0.69 0.496 [-262.17, 534.02]
Time x Post-intervention 20.48 6.22 3.29 0.002 [8.00, 32.96]
Drivers of costs
Data analysis showed that sex, age categories, state, and COVID-19 waves had varying costs per 100,000 for clinical psychology services. Significant differences were observed across groups: Sex (U=3688844, p<0.001), Age Category (H=2418.09, p<0.001), and other variables (Table 4). Similarly, for psychology services, there also significant differences between variables. Females had higher medians (1754.5) than males (673), with a significant U=3688844 (p<0.001). Furthermore, age categories and states exhibited significant variances (H=2241.71, H=328.92; both p<0.001) (Table 5).
Table 4: Potential sociodemographic and temporal predictors of costs of
video consultations for clinical psychology services in MMM 4-7
(March 2020 – February 2023)
Variable Median (Q1, Q3) Test Statistic P-Value
Sex <br />
Female 1754.5 (382.8, 3256.5) 3688844
<0.001
Male 673 (0, 1232.3) <br />
Age Category <br />
15-24 1673 (850.3, 3174.3) 2418.09
<0.001
25-34 2226.5 (1246.5, 4064.3) <br />
35-44 1992 (1162.5, 3499.8) <br />
45-54 1615 (890.8, 2537.5) <br />
55-64 1072.5 (652.5, 1920.8) <br />
65-74 530 (174, 895.3) <br />
75-84 118 (0, 371)
=85 0 (0, 0) <br />
State <br />
ACT 737 (0, 2481.3) 81.65 <0.001
NSW 973 (394.5, 2235.5) <br />
NT 0 (0, 2677.5) <br />
QLD 969 (367, 2003.3) <br />
SA 1028 (218.8, 2033) <br />
TAS 743.5 (0.0, 1543.8) <br />
VIC 1202.5 (393.8, 2143.3) <br />
WA 998.5 (414.5, 2111.3) <br />
COVID-19 Wave <br />
First Wave 771.5 (162.5, 1661) 96.26 <0.001
Low Transmission 822.5 (104.5, 1730.3) <br />
Omicron Wave 952.5 (231.3, 2403.5) <br />
Second Wave 721.5 (0, 1632) <br />
Subsequent Waves 1182 (259.8, 2737) <br />
Third Wave 1021.5 (202.8, 2310.3)
Table 5: Potential sociodemographic and temporal predictors of costs of video consultations for psychology services in MMM 4-7 (March 2020 – February 2023)
Variable Median (Q1, Q3) Test statistic P value
Sex <br />
Female 1283.5 (225, 2594.3) 3688844 <0.001
Male 463 (0, 1021.3) <br />
Age Category (years) 1331.5 (690, 2780.5) <br />
15-24 1795.5 (946.3, 3161.8) 2241.71 <0.001
25-34 1432 (890.8, 2553.3) <br />
35-44 1182.5 (587.3, 1874.5) <br />
45-54 818.5 (415.3, 1479.5) <br />
55-64 395.5 (100.8, 904) <br />
65-74 0 (0, 236.3) <br />
75-84 0 (0, 0)
=85 <br />
State <br />
ACT 116 (0, 1023.8) 328.92 <0.001
NSW 964.5 (307.5, 1884.5) <br />
NT 507.5 (0, 1737.5) <br />
QLD 889 (288.8, 1658.3) <br />
SA 588 (158.8, 1272.8) <br />
TAS 1096 (0, 2653.3) <br />
VIC 1154.5 (450.5, 2317.8) <br />
WA 431.5 (115.3, 1015.5) <br />
COVID-19 Wave <br />
First Wave 672.5 (179.5, 1412.5) 76.65 <0.001
Low Transmission 538 (0, 1325.5) <br />
Omicron Wave 706.5 (44.3, 1555.8) <br />
Second Wave 580.5 (0, 1308) <br />
Subsequent Waves 972.5 (149.8, 2131) <br />
Third Wave 732.5 (0, 1787.3)
Figure 3: Median costs of video services per 100,000 individuals, by COVID-19 wave for each state (Psychology and Clinical psychology Services, March 2020 – February 2023)
Concerning COVID-19 Waves and costs per 100,000 for services, states and territories like Australia Capital Territory (ACT), Tasmania (TAS), and Victoria (VIC) exhibited the highest costs across both services, while the Northern Territory (NT) and Queensland (QLD) show moderate costs. The "Subsequent Omicron Waves" account for the largest share of costs across states, highlighting sustained telehealth demand in later pandemic waves. In contrast, the Delta Variant Wave and First Wave reflected lower initial telehealth adoption (Figure 3). Clinical psychology services consistently incurred higher per capita costs than psychology. TAS shows notably high costs for psychology. Western Australia (WA) and South Australia (SA) reported relatively lower costs (Figure 3).
Vector Autoregressive Moving Average with exogenous inputs (VARMAX) model
A Vector Autoregressive Moving Average model with exogenous inputs (VARMAX) employed to analyse multivariate time-series data (4608 observations) and explore the temporal and demographic effects on the costs of video consultations for clinical psychology (80011) and psychology (80111) services showed notable findings. The VARMAX (5) model with an intercept term captured dynamic interactions over time.
For clinical psychology services, the baseline cost was $1,398.14 (p < 0.001). Significant lagged effects indicated cost persistence. Costs declined notably for individuals aged 65–74 (-$1,068.83, p < 0.001) and were lower for males (-$968.12). However, an interaction effect (65–74 × Male) showed increased costs (+$777.64, p < 0.001) (Table 6).
For psychology services, the baseline cost was $1,597.82 (p < 0.001). Lagged predictors revealed persistent but diminishing effects over time. Costs decreased significantly for the ≥85 age group (-$1,564.14, p < 0.001) (Table 6).
Model fit metrics (AIC: 156205.596, BIC: 156559.551, HQIC: 156330.166) and a log-likelihood of -78047.798 demonstrated strong predictive capability with balanced complexity (Appendix 3). Diagnostics showed no residual autocorrelation (Ljung-Box, p > 0.05), but heteroskedasticity was present (p < 0.001). Overall, the VARMAX (5) model effectively captured cost dynamics and demographic influences.
Table 6: VARMAX Model Results for Costs of Video Consultations for Clinical Psychology Services and Psychology Services (March 2020-February 2023)
Variable Clinical Psychology Services Psychology Services
Coefficient (95% CI) Coefficient (95% CI)
Intercept 1398.14 (1254.65, 1541.64) 1597.82 (1494.66, 1700.98)
Age Category
(Ref: 15-24 years) <br />
25-34 397.43 (272.45, 522.41) 243.13 (140.57, 345.7)
35-44 473.58 (348.2, 598.95) -377.89 (-483.03, -272.75)
45-54 -323.71 (-494.52, -152.9) -577.26 (-695.71, -458.8)
55-64 -623.48 (-813.69, -433.27) -713.7 (-831.5, -595.91)
65-74 -1068.83 (-1317.21, -820.45) -1077.52 (-1221.68, -933.35)
75-84 -1305.78 (-1858.45, -753.12) -1453.83 (-1740.37, -1167.29)
=85 -1375.8 (-2540.37, -211.24) -1564.14 (-2086.93, -1041.36)
Sex (Ref: Female) <br />
Male -968.12 (-1192.69, -743.55) -1082.34 (-1244.72, -919.96)
Interactions <br />
25-34 x Male -176.03 (-465.83, 113.77) -195.97 (-416.42, 24.47)
35-44 x Male -448.88 (-774.34, -123.43) 549.47 (331.87, 767.08)
45-54 x Male 328.96 (-29.7, 687.62) 608.35 (388.97, 827.72)
55-64 x Male 472.1 (89.46, 854.75) 583 (340.27, 825.74)
65-74 x Male 777.64 (373.63, 1181.66) 814.97 (537.13, 1092.82)
75-84 x Male 1019.31 (364.45, 1674.18) 954.4 (425.77, 1483.04)
=85 x Male 962.77 (-887.58, 2813.13) 1060.77 (-39.19, 2160.72)
Generalised Linear Mixed Model (GLMM)
For clinical psychology, the final Generalised Linear Mixed Model (GLMM) identified significant state and COVID-19 wave effects on square root-transformed healthcare costs. The baseline cost for the reference state and baseline wave was estimated at β₀ = 34.017 (p < 0.001). State effects varied substantially, with higher costs in NSW (β = 4.472), VIC (β = 4.465), and WA (β = 4.768) compared to the reference state (p < 0.001 for all). In contrast, NT (β = -1.804, p = 0.006) and TAS (β = -2.178, p = 0.004) exhibited lower costs, while QLD and SA showed no significant differences. COVID-19 wave effects highlighted increased costs during the Omicron Wave (β = 4.222, p = 0.006), Subsequent Waves (β = 7.385, p < 0.001), and the Third Wave (β = 4.083, p = 0.003), with no significant effects during Low Transmission or the Second Wave (Table 7).
For psychology services, significant COVID-19 wave effects included decreased costs during Low Transmission (β = -2.838, p = 0.019) and the Second Wave (β = -2.535, p = 0.041) but increased costs in Subsequent Waves (β = 3.967, p < 0.001). Effects during the Omicron and Third Waves were not statistically significant (Table 8).
Random Effects
The models demonstrated significant variability across states and sexes for clinical psychology, with state variance (σ² = 450.025) and sex variance (σ² = 250.233). Covariance between state and sex was negligible. For psychology, state variability was moderate, with random intercept variance at σ² = 34.873.
Residual Analysis
Residual diagnostics confirmed well-fitting models for both clinical psychology and psychology services. Residuals were symmetrically distributed around zero, with no discernible patterns against fitted values, indicating homoscedasticity. QQ-plots showed alignment with normality, with only minor tail deviations, confirming robust model performance.
The results of multiple analyses in this study show that the COVID-19 pandemic's telehealth expansion significantly increased healthcare costs, particularly for clinical psychology and psychology services. Video consultations surged in usage and cost, rising from AU$169.5 to AU$1,557.6 for clinical psychology and from AU$117.9 to AU$1,313.5 for psychology post-intervention. Despite lower operational costs, telehealth's broader accessibility drove total expenditures higher. Females and younger adults (25–34) incurred higher median costs, while costs declined with age. Regional disparities showed NSW, VIC, and WA with higher costs, while NT and TAS had lower costs. Temporally, costs peaked during the Omicron and Subsequent Waves, highlighting telehealth’s role in reshaping access and healthcare spending patterns.
Table 7: Results of Generalised Linear Multilevel Effects Model- Video Services for Clinical Psychology
Fixed Effect Coefficient (β) Standard Error p-value
Intercept 34.017 1.105 <0.001
State <br />
ACT (Ref) <br />
NSW 4.472 0.451 <0.001
VIC 4.465 0.456 <0.001
WA 4.768 0.481 <0.001
NT -1.804 0.659 0.006
TAS -2.178 0.645 0.004
COVID 19 Wave <br />
First wave (Ref) <br />
Omicron Wave 4.222 1.312 0.006
Subsequent Waves 7.385 1.094 <0.001
Third Wave 4.083 1.153 0.003
Low Transmission -0.389 0.958 0.582
Second Wave -1.879 1.331 0.156
Random Effect Variance (σ²)
State Variance 450.025
Sex Variance 250.233
Table 8: Results of Generalised Linear Multilevel Effects Model- Video Services for Psychology
Effect Coefficient (β) Standard Error P-value
Intercept 26.196 3.102 <0.001
Low Transmission -2.838 0.921 0.019
Second Wave -2.535 1.052 0.041
Subsequent Waves 3.967 0.854 <0.001
Omicron Wave -0.374 1.402 0.794
Third Wave 0.472 1.239 0.713
Random Effect Variance (σ²)
State Variance 34.873
Discussion
The telehealth policy changes introduced in Australia, particularly during the COVID-19 pandemic, were effective in maintaining healthcare access while transforming cost and utilisation patterns. Video consultations experienced high cost increases post-intervention, rising from AU$169.5 to AU$1,557.6 per 100,000 for clinical psychology and from AU$117.9 to AU$1,313.5 per 100,000 for psychology. This reflects the success of telehealth initiatives in addressing the need for alternative healthcare delivery during a period of reduced in-person accessibility. Concurrently, in-person services showed reduced costs, with clinical psychology and psychology services seeing declines of AU$26,874.3 and AU$16,484.1 per 100,000, respectively, suggesting a patient and provider shift toward telehealth models.
These findings align with policy goals aimed at improving healthcare access during the pandemic. However, the increased reliance on telehealth has introduced new cost dynamics, emphasizing the need for ongoing policy evaluation and adjustment (34).
One of the primary objectives of telehealth expansion was to improve access for underserved populations, particularly in rural and remote areas. The data showed a significant rise in video consultation utilisation in MMM 4-7 regions, with mean benefits for clinical psychology increasing from AU$169.5 to AU$1,557.6 per 100,000, highlighting telehealth's potential in reducing geographic barriers. However, the persistent disparities between states (e.g., higher costs in NSW, VIC, and WA compared to NT and TAS) suggest that equitable access remains incomplete, potentially due to varying levels of digital infrastructure and healthcare resource availability across regions.
Demographic factors also played a role in equity. Younger adults (25–34 years) and females incurred higher costs, likely reflecting greater adoption and acceptance of telehealth among these groups. In contrast, older adults, particularly those aged 75+, demonstrated lower utilisation, which aligns with existing barriers such as digital literacy and access to technology (29). Addressing these gaps will be crucial to achieving broader equity.
While telehealth reduces operational costs, such as travel and physical infrastructure, the study revealed unintended cost increases driven by higher demand. Post-intervention, total expenditures on telehealth services exceeded pre-intervention levels due to the broader accessibility and convenience of telehealth. This aligns with international findings, where expanded telehealth offerings led to increased utilisation, even for patients who might not have sought in-person care previously (30, 31).
The increased demand raises concerns about the sustainability of telehealth expansion. Without appropriate measures, such as optimized service models or stricter triaging protocols, cost growth could outpace the savings derived from operational efficiencies. These findings underscore the importance of balancing access with cost control in telehealth policy design.
The findings align with existing literature on telehealth’s potential to improve equity and access, particularly in rural areas. Previous studies have demonstrated that telehealth reduces barriers to care in underserved populations, including rural communities in Australia and globally. However, consistent with this study, the literature highlights challenges such as uneven adoption across demographics and regions, often tied to digital infrastructure disparities (31).
The cost dynamics observed in this study are also reflected in the broader telehealth literature. While some studies note cost reductions due to efficiency gains (32), others, similar to these findings, report increases linked to higher service utilisation post-expansion (2, 12). This duality highlights telehealth’s capacity for both cost savings and demand-driven expenditure growth.
Lastly, the sociodemographic patterns observed here, with greater adoption among younger and female populations, align with global trends, as these groups are generally more tech-savvy and proactive in seeking healthcare services (32).
Conclusion
This study showed that the introduction of telehealth improved access to mental health services in MMM 4–7 regions. However, it led to increased costs due to higher service utilisation. While video consultation costs for psychology services rose, in-person expenses declined, reflecting a shift in care delivery. In addition, cost variations were influenced by demographics, geography, and COVID-19 waves, with younger adults, females, and certain states (NSW, VIC, WA) seeing higher expenditures. It is important to consider policy adjustments to balance financial sustainability with accessibility. Future research should explore how telehealth models can be refined to enhance cost efficiency while maintaining benefits.
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