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The Robot Doctor, Dr. Kinect, and the Future of Telemedicine

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Bomb squads, vacuum cleaners and doctors -- what do they all have in common? The answer is iRobot (NASDAQ: IRBT  ) , an incredibly versatile company that has created bomb-sweeping robots, Roomba automated vacuum cleaners, and virtual doctors powered by Apple iPads. iRobot's new product -- the 5-foot-tall RP-VITA, a remote presence robot doctor -- is a creation that uses the technology of its predecessors for healing, rather than detecting explosives or cleaning floors. Does the RP-Vita represent a unique turning point in the world of health care, or is it an overpriced, superfluous product that most hospitals won't be able to afford?

How RP-VITA works
RP-VITA is an acronym for Remote Presence Virtual and Independent Telemedicine Assistant. The robot is now available at six hospitals in the United States and one in Mexico City. RP-VITA is controlled by an iPad, and operates like a mobile webcam to allow a remote doctor to remotely interact with patients, doctors and nurses. Using Roomba technology, the RP-Vita can use a map to navigate hospitals autonomously and locate patients automatically. RP-Vita is equipped with an on-board stethoscope as well. The robot and its technical support cost $5,000 a month.

If successful, RP-VITA could be used for a myriad of operations. The robots could be deployed to remote locations where medical facilities are too far away. They could also be used in quarantined environments deemed unsafe for human doctors to enter.

Even though RP-VITA isn't generating any meaningful revenue for iRobot yet, it is an interesting diversification away from its core business of Roomba products. Last quarter, iRobot disappointed Wall Street with a 19% year-on-year drop in adjusted earnings to $0.21 per share, although revenue rose 17% to $130 million on the back of strong sales of its home robots (Roomba, Scooba, Mirra, Looj) business. Shares have steadily trended downward over the past month as a result.

However, I wouldn't underestimate iRobot's ability to bounce back. After all, this is the same company that effortlessly altered its bomb-sweeping technology to clean floors, carpets, pools, and gutters after a major decline in revenue from its defense contracts between 2012 and 2013.

Dr. Kinect will see you now
Speaking of remote doctors, another product gaining traction is Microsoft's (NASDAQ: MSFT  ) Kinect. Although the motion-sensing device was initially developed as a gaming device to compete against Nintendo's Wii, its 3-D motion capture technology has found applications in health care. Unlike the Wii, which merely detects the movement of the controller, the Kinect's webcam technology can accurately mirror a subject's bodily movements.

To tap into the potential of Kinect, Microsoft turned to its joint venture, Avanade, which was formed in 2000 with tech and outsourcing company Accenture (NYSE: ACN  ) . Avanade showed health care providers that the movement tracking technology of the Kinect could be used in tandem with Microsoft's HealthVault EHR program to provide customized remote physical exams.

For example, a remote doctor can use a webcam to instruct a patient to perform physical actions, which are tracked via Kinect. The Kinect can even use a pre-programmed preliminary exam based on EHR information without a doctor present, shortening the amount of time the actual doctor would need to spend with each patient and increasing the overall efficiency of a practice.

Just like iRobot's project, Avanade's system, known as Virtual Healthcare, is still in its infancy. Nonetheless, a study by the International Journal of Electronic Finance claims that the system could save up to $30 billion in U.S. health care costs.

A Foolish final thought
The idea of virtual doctors is one worth following, especially as the global population increases. Not everyone will live close enough to a health care facility, and remotely deployed virtual health care systems connected to cloud-based EHRs could improve health care for millions and save billions in health care costs.

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