Telemedicine Is Set to Expand, But State Licensure Laws Could Limit Growth

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By: Ryan Martin,

As recently reported, the global telemedicine industry is expected to grow to $57.92 Billion by the year 2020.[1] While that is still a small share of the total health care industry, it represents a 17.85% compound growth rate, signaling that telemedicine services are here to stay.[2]

Telemedicine, also known as telehealth, aims to provide medical services via electronic communications.[3] Often, these services can help provide medical care in rural areas where the accessibility to physicians is limited.[4] In a typical visit, a patient will “chat” with a physician through a webcam service, then be advised on a treatment or recommended to seek further treatment.[5] While the concept of telemedicine has been around as long as the telephone, it has seen a dramatic take off with the rise of mobile and video technology.[6] The Federal Government is now showing an interest in growing access to these services by providing grants to community hospitals for use in rural areas.[7]

However, as the industry continues to grow there are several legal and regulatory aspects that will need to be addressed to ensure that healthcare providers can provide telemedicine services in a cost effective manner. Among them are restrictions to reimbursement through Medicaid and Medicare, privacy concerns regarding HIPPA, and the threat of malpractice suits resulting from the inability to conduct a full physical examination of the patient.[8] Perhaps the most daunting hurdle—specifically in the United States—is individual state licensing restrictions.[9]

States are responsible for regulating and monitoring healthcare professionals within their state and generally require full licensure to provide services to patients in that state.[10] For example, a physician practicing internal medicine in California would need to be fully licensed by the state of Florida in order to provide a telemedicine consultation to a patient who is located in Florida. While it is understandable that a state would want to protect its citizens from an unlicensed physician, telemedicine transcends geographic boundaries; putting heavy licensing restrictions frustrates its purpose of providing common, low risk services, where the often alternative option is no healthcare service at all.

A few states have amended their state laws to allow for easier access to telemedicine. Several states allow for physicians from boardering states to provide medical services.[11] Ten states have taken steps to establish special telehealth licenses that allow a physician to practice through telemedicine services but not physically in that state.[12] This helps expedite the physician’s license and shortens what is often a lengthy review of her application.[13] However, no state has allowed for direct reciprocity.[14]

The American Telemedicine Association publishes an annual report card for each state, grading their licensure policies from A to F, based on the reasonableness of its telemedicine practice standards, licensure requirements, and policy on Internet prescribing.[15] In its latest report, there were no “A’s” issued, indicating that there is still work to be done if states want to expand telemedicine services.[16]

There is currently one potential resolution to the licensing problem. Seventeen states have signed a Federation of State Medical Boards (FSMB) compact that requires an expedited licensing process for out-of-state practitioners.[17] However, the FSMB does not create federal licensure law and each individual state has to affirmatively adopt the compact.[18] Because of this, the FSMB compact likely falls short of being a sufficiently comprehensive plan.

The future appears to be positive for telemedicine services, but if nothing is done to change the current regulations, telemedicine providers may be stuck with navigating the often-complex state regulations that limit the availability to such services. Should the federal government truly desire to increase healthcare accessibility in rural areas through telemedicine, more will need to be done to alter state licensing regulations.

 

[1] See Telemedicine Market to Reach $ 57.92 Billion by 2020, Thanks to Evolving Reimbursement Policies; Reveals Market Data Forecast Analysis, PR Newswire, (Sept. 14, 2016), http://www.prnewswire.com/news-releases/telemedicine-market-to-reach–5792-billion-by-2020-thanks-to-evolving-reimbursement-policies-reveals-market-data-forecast-analysis-593396911.html.

[2] See id.

[3] See What is Telemedicine, American Telemedicine Association, http://www.americantelemed.org/about-telemedicine/what-is-telemedicine#.V9w6BDuTUb0 (last visited Sept. 16, 2016).

[4] See Jonah Comstock, How telemedicine, remote patient monitoring help extend care in Mississippi, MobiHealthNews, (Sept. 13, 2016), http://www.mobihealthnews.com/content/how-telemedicine-remote-patient-monitoring-help-extend-care-rural-mississippi.

[5] See What is Telemedicine, supra note 1.

[6] See id.

[7] See Joseph Goedert, Federal grants give rural telehealth programs a boost, HealthData Management, (Aug. 16, 2016), http://www.healthdatamanagement.com/news/federal-grants-give-rural-telehealth-programs-a-boost.

[8] See John Donohue, Telemedicine: What the future holds, Healthcare IT News, (Sept. 6, 2016, 11:06:00 AM), http://www.healthcareitnews.com/blog/telemedicine-what-future-holds; HIPPA Guidelines on Telemedicine, HIPPA Journal , http://www.hipaajournal.com/hipaa-guidelines-on-telemedicine (last visited Sept. 16, 2016); Neil Chesanow, Do Virtual Patient Visits Increase Your Risk of Being Sued?, Medscape, Oct. 22, 2014) http://www.medscape.com/viewarticle/833254.

[9] See Kristi VanderLaan Kung, Recent Relaxation of State-level Challenges to Expansion of Telemedicine but Barriers Remain, The National Law Review, (Aug. 18, 2016), http://www.natlawreview.com/article/recent-relaxation-state-level-challenges-to-expansion-telemedicine-barriers-remain.

[10] See id.

[11] See Latoya Thomas & Gary Capistrant, State Telemedicine Gaps Analysis, AM. TELEMEDICINE ASS’N 4 (Jan. 2016), http://www.americantelemed.org/docs/default-source/policy/50-state-telemedicine-gaps-analysis–physician-practice-standards-licensure.pdf.

[12] See id.

[13] See id.

[14] See id.

[15] See id.

[16] See Thomas, supra note 11.

[17] See Kung, supra note 9.

[18] See id.

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