If there is a silver lining to the dark cloud COVID-19 has cast over this country these past twelve months, it is that we are discovering previously under‐used technologies that enable us to work and socialize without even leaving our homes. An example is telehealth—a technology that is actually not new. Tele‐radiology, for example, which taps the skills of the world’s experts in diagnostic imaging, has been in use since the beginning of this century. Yet telehealth has only received the attention it deserves with the advent of the COVID-19 pandemic.
As emergency measures, most states’ governors temporarily suspended the requirement that telehealth services can only be provided by practitioners licensed by their states. The Centers for Medicare and Medicaid Services, for the first time, began paying providers for telehealth services—even if they were provided to beneficiaries by practitioners licensed out‐of‐state. CMS expanded the list of telehealth services covered and made this policy permanent at the end of 2020.
Today, Senators Tim Scott (R-SC) and Brian Schatz (D-HI) re‐introduced the Telehealth Modernization Act, which will codify and expand telehealth coverage for seniors in Medicare.
This doesn’t address the major obstacle that blocks patients from this great technological advance in 21st century medicine: state licensing laws prohibit patients from receiving care from health practitioners licensed out‐of‐state. And while many states temporarily suspended these laws for the course of the public health emergency, things will return to the status quo ante when the emergency ends.
A person can travel from, say, Phoenix, Arizona to Los Angeles, California to consult and receive care from a renowned expert in a unique medical condition, but cannot do telehealth follow up appointments with that practitioner unless that practitioner gets a license in Arizona. In other words, the patient can travel to the doctor, but the doctor cannot travel to the patient. The fact that Medicare would pay the out‐of‐state doctor for the telehealth services doesn’t help matters if the doctor can’t provide the services.
While many states suspended the barriers to movement of health care practitioners or the delivery of telemedicine across state lines, when this emergency passes, the barriers will return. To the extent consistent with its authority to tear down barriers to interstate commerce under Article 1, Section 8 of the Constitution, Congress should define the “locus of care” as the state in which the practitioner is located as opposed to the state in which the consumer of the service resides. While states have constitutional authority to regulate the practice of medicine for residents within their borders, crossing state lines to provide telemedicine or short‐term in‐person care can reasonably be classified as interstate commerce. This change would increase access to care and allow patients to utilize expertise that may exist in areas of the country otherwise beyond their reach. It would also remove the protection from out‐of‐state competitors that health care providers otherwise enjoy. The increased competition would redound to the benefit of patients.
Cato adjunct scholar Shirley Svorny originally proposed redefining the “locus of care” here.
States don’t have to wait for the U.S. Congress to act. They can take matters into their own hands by removing the licensing requirement for out‐of‐state providers of telehealth services. I testified about this before the Occupational Licensing and Certification Laws Committee of the Idaho legislature. I pointed out that licensing requirements are virtually identical in every state, and states routinely license practitioners who have received their training in the other 49 states and the District of Columbia. Furthermore, out‐of‐state telehealth providers are required to obey state laws and regulations, while in‐state licensing boards can field complaints about out‐of‐state practitioners from patients within the state and take appropriate action.
Until state licensing obstacles are removed, the growth of this wonderful technology will remain stunted. And patients—not providers—will be the biggest losers.