2024 U.S. Telehealth Laws: Licensing, Reimbursement, and State Regulations

To maximize the effectiveness of your healthcare organization’s telehealth program, it’s crucial to stay informed so we’ve curated recent updates in telehealth legislation across the US.

Provider Licensing and Service Preparation

Federal and state laws typically mandate that healthcare providers must be licensed in both the state where they are based (“distant site”) and the state where the patient is located ( “originating site”). So, if a provider lives in Washington and conducts a telehealth visit with a patient in Florida, they must be licensed in both Washington and Florida. However, many states offer cross-state licensing licenses or permits specifically for telehealth, known as. read Mastering Telemedicine Permits: A Comprehensive Guide for Out-of-State Providers

A tool that can speed up the licensing process is the Uniform Application for Licensure collects all information needed for credentials verification as well as board-specific requirements for participating states. For availability in your area, see the list of participating state medical boards.

Many states are exploring new policies that seek to ensure states have the continued authority to regulate and oversee the practice of medicine for their residents while also taking into consideration modern-day realities of patient movement, physician shortages, and the regionalization/nationalization of health care delivery as virtual care becomes more commonplace

Over 20 states introduced various types of telehealth licensure legislation. 

There were three key themes of both introduced and passed legislation: 

• out-of-state licensure exceptions; 
• temporary telehealth licensure pathways or telehealth registries;
• continued growth of the Interstate Medical Licensure Compact (IMLC). 

the Interstate Medical Licensure Compact (IMLC) streamlines the licensing process. For the latest list of participating states and answers to frequently asked questions, read Navigating the IMLC – Everything You Need to Know About Multistate Licensure 

Idaho House Bill 162: Allows out-of-state providers to offer services in Idaho if they:

• Have an existing patient-provider relationship with a temporary Idaho resident.
• Provide continuity care for Idaho patients they already serve.
• Work for an Idaho healthcare facility where they’re privileged and credentialed.
• Deliver emergency care during disasters and follow-up for continuity of care.
• Consult or refer to a licensed Idaho provider.

Idaho House Bill 61: Permits mental and behavioral health providers not licensed in Idaho to deliver digital care services to Idaho residents, if they:

• Hold a valid license from a state with similar standards.
• Have no disciplinary actions pending or in history.
• Comply with Idaho laws and liability insurance requirements.
• Consent to jurisdiction in Idaho and biennially register for telehealth services in Idaho.

Oregon Senate Bill 232: Enables out-of-state physicians, not licensed in Oregon, to provide temporary follow-up care to patients in Oregon with whom they have an established relationship.

Virginia House Bill 1754: Expands existing laws, allowing out-of-state physicians, and now practitioners in the same subspecialty and group practice, to provide telehealth in Virginia if:

• The care ensures continuity.
• There’s an existing patient-practitioner relationship.
• An in-person exam occurred within the last 12 months, or another qualified practitioner from the same group with access to patient history steps in when the primary provider is unavailable.

Several bills outlined how out-of-state physicians or other healthcare professionals could provide telehealth services in-state either through temporary licenses or telehealth registrations: 

Louisiana Senate Bill 66: Updates the Louisiana Telehealth Access Act to:

• Require licensing boards to develop a telehealth registration/licensure process for providers licensed in other states.
• Exempt consultative services from state licensure requirements.

Utah House Bill 159: Enables the issuance of temporary licenses for digital care providers if they:

• Hold a healthcare license from another state, district, or territory.
• Have applied for a Utah license but face processing delays exceeding 15 days.
• The temporary license allows them to offer telehealth services in Utah, provided they comply with their original license scope and Utah’s state law.

Vermont House Bill 411: Allows licensed healthcare professionals from other states to:

• Obtain temporary telehealth registration in Vermont.
• Provide telehealth services in Vermont until the state’s new telehealth licensure system (established by 26 V.S.A. Chapter 56) becomes operational.

To deliver telehealth services, a provider must be credentialed for and have privileges at the facility they will be working for, regardless of if they’re physically on-site. This can be done by a traditional in-house credentialing process or through credentialing by proxy.

Telehealth Compliance and Reimbursement: State Approaches and Enrollment Policies

There’s a growing trend in Medicaid policies focusing on how providers sign up, especially regarding rules about having an in-state address.

Licensing and credentialing providers for rural health facilities follow the same process as for those in urban areas. Healthcare facilities in rural locations seeking to streamline their telehealth credentialing process can benefit from credentialing by proxy by allowing community and critical access hospitals to rely on the credentialing process of distant sites.

Alabama, for instance, requires providers to have an address in the state or a neighboring state to offer telemedicine services. Wisconsin’s Medicaid program, ForwardHealth, restricts enrollment of out-of-state providers to those near the border, and only for non-emergency services.

States are also taking on roles usually handled by professional boards. Alabama’s Telemedicine Policy sets out rules for practice, prescribing medication, and keeping records. Connecticut and Massachusetts have released guidelines about virtual care, covering things like privacy, patient location, and getting consent.

Changes are also happening in-laws for private insurers. Nevada, Nebraska, and Hawaii, for example, have updated their laws to ensure virtual care services, including audio-only calls, are paid for fairly.

Professional boards are more involved in telehealth, too. Oregon’s SB 232 now lets doctors and physician assistants establish patient relationships using telemedicine. West Virginia’s Nursing Board has changed its rules to allow telemedicine for creating patient relationships, either through video or audio calls.

When it comes to prescribing medication, states like Oklahoma and New Hampshire have new laws for prescribing controlled substances through telemedicine, with specific rules for how this can be done.

Lastly, states are creating new ways to license telehealth providers from other states. Maryland, D.C., and Virginia have an agreement to accept each other’s licenses, and New Mexico and Utah have temporary licenses for telemedicine. Even with these state-level changes, agreements between states are still a common way to allow telehealth across state lines.

Maximizing Telehealth Reimbursement

When it comes to paying for telehealth, laws called payment parity, both at the state (Medicaid) and federal (Medicare) levels, play a big role in deciding how much providers get paid. The Centers for Medicare and Medicaid Services (CMS) has made sure that for many services, telehealth payments are equal to in-person visits, with some of these rules lasting until the end of 2024.

Telehealth rules keep changing in the U.S., with each state finding its own way to include telehealth in its services. For example, Nebraska’s Medicaid now permanently pays for a variety of services like mental health and physical therapy, based on rules set during the Public Health Emergency (PHE).

Louisiana has revised its Medicaid manual to include telehealth services by ambulance providers, listing what’s covered and who can provide these services. North Dakota is paying for Digital Health Evaluation and Management Services that depend on patient input. This is part of a bigger trend where states list which telehealth services are eligible for payment, following Medicare’s lead, including some services that only require a phone call.

Iowa’s Medicaid system, like CMS, has a list of telehealth services that can be paid for, specifying which ones can be done by phone. Connecticut, Colorado, and Oklahoma use a similar approach, indicating eligible telehealth services with specific codes.

North Dakota recently updated its policy to pay for phone-based health evaluations, but only under certain conditions, like if the patient or their guardian starts the service. Vermont’s Medicaid also continues to pay for some phone-based services. South Carolina is cautiously keeping some flexible rules from the COVID-19 PHE for phone services.

Alabama’s telemedicine policy will continue to pay for phone-based services with new rates starting October 2023. Meanwhile, California is reducing payments for certain services after the PHE.

During the PHE, states increased coverage and payments for phone-based services. As of June 2020, 38 state Medicaid programs were covering these services. Phone-based services are crucial for connecting with patients who don’t have good internet or can’t do video calls, especially in rural areas. After the PHE, states are rethinking how much and for what types of services phone-based care should be paid.

In the past year, 14 states introduced laws about paying for phone-based services. These laws varied, but many focused on setting payment rates for these services or defining them as telehealth.

In 2023, five states passed new laws for phone-based telehealth:

• Florida: Redefined telehealth to include phone-based services.
• Hawaii: Made changes to how phone-based services for mental health are paid, effective until the end of 2025.
• Maryland: Extended equal payment for telehealth, including phone services, until mid-2025.
• Utah: Required Medicaid to pay for phone-based services.
• Washington: Extended the period for using video calls to establish a patient relationship for certain mental health services via phone.

Understanding Current Payment Parity Laws

Pay parity laws in telehealth come in two types:

• Payment Parity for Telehealth: This means that telehealth visits should be paid the same as in-person visits. The idea is to ensure that healthcare providers receive equal payment regardless of whether the service is provided face-to-face or via telehealth.

• Telehealth Service or Coverage Parity: Often called access parity, this requires that the same services covered in person should also be covered when delivered via telehealth. However, this doesn’t mean the payment will be the same.

As of early 2023, over 40 states in the U.S. have adopted coverage parity, which means they agree to cover telehealth services just like in-person services. But, many are still figuring out the best way to pay for these services, especially since it’s not clear if telehealth costs more or less to provide than traditional care.

Regarding payment parity, over 25 states had put such laws in place by January 2023. Of these, 21 states had made them permanent, while five had conditions attached, like being temporary or only for certain types of services like behavioral health.

In 2023, there wasn’t much new legislation aimed at coverage parity, as most states had already adopted it. However, there was significant activity around payment parity, with 15 states introducing bills on this topic. These laws varied, some making payment parity permanent for all or certain payers, others extending temporary measures, and some focusing on specific areas like behavioral health.

For example, in 2023:

• Colorado passed a law ensuring permanent payment parity for behavioral health services delivered via telehealth to veterans.
• Hawaii required telehealth services, especially audio-only mental health services, to be paid at 80% of the in-person rate until the end of 2025.
• Nevada implemented payment parity under specific conditions, like services provided to patients in rural areas or through certain healthcare facilities, and for behavioral health services.

By October 2023, 21 states had laws requiring payment parity, eight had some form of parity with conditions, and 21 states did not have any payment parity laws.

Telehealth Reimbursement Policies Breakdown

• All fifty states, along with Washington DC, offer Medicaid reimbursement for live video consultations. Notably, Puerto Rico and the Virgin Islands have not explicitly included live video reimbursement in their permanent Medicaid policies.

• Thirty-three state Medicaid programs now reimburse for store-and-forward services. Since the Spring update, Florida, Montana, North Dakota, South Carolina, and Utah have introduced limited reimbursement for this modality, often through specific communication technology-based service (CTBS) codes.

• Remote Patient Monitoring (RPM) reimbursement is available in thirty-seven state Medicaid programs. Florida, Idaho, and Iowa have expanded their reimbursement policies to include RPM since Spring 2023.

• Audio-only telephone consultations receive reimbursement in forty-three states and DC Medicaid programs, albeit with certain restrictions. Alabama, Idaho, Kansas, Montana, Nebraska, Oklahoma, and Vermont are among the seven states that have recently introduced some form of reimbursement for audio-only telehealth.

• Twenty-five state Medicaid programs, including Alaska, Arizona, California, Hawaii, Illinois, Iowa, Kentucky, Maine, Massachusetts, Maryland, Michigan, Minnesota, Missouri, New York, North Carolina, North Dakota, Ohio, Oregon, South Carolina, Texas, Utah, Vermont, Virginia, Washington, and Wisconsin, provide reimbursement for all four telehealth modalities (live video, store-and-forward, RPM, and audio-only). However, specific limitations may apply to each modality.

• Forty-three states, along with the District of Columbia and the Virgin Islands, have enacted private-payer laws addressing telehealth reimbursement. These laws vary, with twenty-four states explicitly mandating payment parity. Since Spring 2023, no new states have introduced private payer laws, but several have modified existing private payer law requirements.