Doctor Holding Cell Phone. Cell phones and other kinds of mobile devices and communications technologies are of increasing importance in the delivery of health care. Photographer Daniel Sone.

Toward a Broader Telehealth Licensing Scheme

By Fazal Khan

Evidence generated during the first year the COVID-19 pandemic has called into question the need for many of the telehealth restrictions that were in effect prior to the pandemic.

The question many policymakers are asking now is: which of the telehealth regulatory waivers enacted during the pandemic should become permanent?

My forthcoming article proposes that the federal government use its spending power to incentivize states to adopt a de facto national telehealth licensing scheme through state-based mutual recognition of licensing and scope of practice reforms through a Medicaid program funding “bonus.”

Prior to COVID, policymakers and the medical industry had many assumptions about telehealth related to patient safety, quality of care, fraud, and provider and patient openness to virtual medical encounters.

However, during the first several months of the pandemic, telehealth, or the delivery of health care remotely via the use of telecommunications technology, grew explosively following the declarations of federal and state public health emergencies and subsequent waivers of numerous telehealth and medical licensing restrictions. Access to telehealth services became much easier for patients and medical providers. During the initial months of the pandemic, patient interest in seeking out telehealth increased from 11% to 76%, and provider telehealth visits rapidly scaled up exponentially (50-175x).

Following more than a year of data during the COVID pandemic, it has become clear that most patients and providers value the availability of expanded telehealth services. In addition, temporary waivers of state licensing restrictions for out-of-state health care providers increased availability for patients to receive non-COVID related services, such as mental health services, in locations that were historically underserved.

Most crucially, the continued stress from novel infectious diseases like COVID-19 (and others that have yet to arise) and phenomena like climate change, globalization, and an aging population, necessitates a proactive federal strategy that can increase the nation’s health care capacity on a permanent, rather than emergency basis. A de facto national telehealth licensing scheme, characterized by state-based mutual recognition of licensing and scope of practice reforms, would achieve just that.

The mutual recognition licensing scheme would allow for providers licensed in at least one state to provide telehealth services nationally, regardless of their licensure status in other states. States would still have the ability to restrict out-of-state providers from providing in-person services within their state under this proposal and could independently discipline or exclude any provider upon a showing of harm or excessive risk to in-state patients.

The national scope of practice reform would require states to allow non-physician providers (e.g., nurse practitioners, advanced practice registered nurses, pharmacists) to practice health care to the full extent of their training. This forward-looking reform will include the regulatory flexibility to expand any particular provider’s scope of practice based on empirical clinical data demonstrating safe and effective outcomes, and in response to emerging technologies such as artificial intelligence (AI) based programs that could augment the diagnostic and treatment capabilities of lesser-trained providers.

States that do not adopt these changes will not lose their existing federal Medicaid funding, but rather would lose a “bonus” equivalent to 5-10% of their baseline funding. Further, this proposal presumes the federal government will go forward with stated plans for massive infrastructure investments in broadband internet and 5G networks to expand access to these high-speed networks.

This proposed mutual recognition licensing scheme is preferable a nationalized option, as it preserves some state authority. While some legal scholars consider state-based licensing schemes of professionals to be tantamount to state-sanctioned cartels that only exist to restrain competition, I would counsel against a national-based licensing scheme, as it would give states less flexibility in protecting their in-state health care capacity and labor markets.

With a remote-delivery system enabled by telehealth and advances in AI technology, it is not far-fetched to imagine that Silicon Valley would jump at the chance to replace millions of moderate and highly paid medical professionals with automated agents or lesser trained paraprofessionals augmented by AI. For states already dealing with the challenge of the loss of jobs that have been outsourced or automated, the health care industry represents a relatively stable source of middle income jobs that are widely geographically distributed.

Allowing states to put some limits on the percentage of out-of-state telehealth providers, or requiring that AI medical programs have a medical professional “in the loop” when delivering health care, will certainly be a barrier to achieving the full optimization of telehealth’s capabilities. However, as I explain in a previous article, “The Uberization of Healthcare,” and as a team of Stanford AI scholars persuasively argue in their new book System Error, optimization through technology is a means to an end. In other words, we need to be wary of optimizing outcomes that are not socially beneficial—namely, facilitating Silicon Valley in the displacement of most decent-paying medical jobs through the combination of investment capital, technology, and the removal of regulatory restraints.

Fazal Khan, M.D., J.D. is an Associate Professor of Law at University of Georgia School of Law.

The Petrie-Flom Center Staff

The Petrie-Flom Center staff often posts updates, announcements, and guests posts on behalf of others.

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