State Changes to Telehealth Policy Appear to be Stagnating

State action on telehealth policy and regulation stalled in 2023, apart from a few states that made significant changes, according to a new report.

Released by the Cicero Institute, the third annual 50-state telehealth innovation report card examines telehealth policy changes in the past year. The report grades every state’s telehealth laws in four areas: modality-neutral telehealth laws, the ability to start telehealth by any mode, barriers to out-of-state telehealth, and independent practice for advanced practitioners.

Telehealth policy updates that passed last year mostly tweaked the edges of existing policies, the report authors stated.

“Many of the telehealth bills filed around the country fell into the familiar areas pushed by special interests to mandate coverage of certain services, or mandating certain payment levels,” they wrote. “Few bills focused on making the telehealth landscape flexible enough to allow for innovation.”

Only Arizona and Delaware achieved gold ratings across all four areas noted above, while New Jersey, South Carolina, and Virginia did not score gold in any of the categories. The gold rating is for states with telehealth laws that are “innovation ready,” according to the report.

“In the face of desperate need for innovative healthcare solutions, many state leaders are inexplicably dropping the ball on telehealth,” said Josh Archambault, a senior fellow at the Cicero and Pioneer Institutes, in a press release.

The report pointed to three states that did make significant changes to telehealth policy in 2023: Idaho, Louisiana, and Utah.

Idaho updated laws to allow healthcare providers to start a patient relationship using asynchronous telehealth, provided the standard of care is met. The state also passed a law enabling out-of-state telehealth for behavioral healthcare services. As a result, Idaho’s ranking on Cicero Institute’s telehealth innovation chart changed from red, which represents states with barriers to innovation, to blue, states where telehealth laws need improvements.

Louisiana changed its laws to standardize telehealth definitions and required licensing boards to enact interstate registration rules. Previously, the state’s laws only encouraged the boards to issue rules in this area.

Utah passed an out-of-state telehealth reform law that streamlined the application process to offer patients access to care from out-of-state providers via telehealth. The state now provides an automatic non-resident healthcare license. If a provider’s application is not processed within 15 days of submission, it is considered automatically approved, provided the applicant does not violate other state laws. This new policy moved Utah’s innovation chart ranking from blue to gold.

Further, the report noted that allowing nurse practitioners (NPs) to practice without physician oversight is necessary as the provider shortage grows nationwide. Expanding NPs’ scope of practice can potentially increase healthcare access and reduce costs.

“Cutting red tape is key for providers and patients to unleash the full potential of telehealth,” said Ally Perkins, report co-author and a research assistant at Cicero Institute, in the press release. “Patients in rural communities, those with disabilities, and seniors need more options for care, and telehealth offers a clear solution.”

Since the spike in telehealth adoption and use at the onset of the COVID-19 pandemic, states have scrambled to ensure their policies and laws reflect the needs of the hour. However, the changes in state policy have been piecemeal, with different states enacting varying laws to govern virtual care.

For instance, a report released by the Center for Connected Health Policy (CCHP) last October shows that only 25 provide Medicaid reimbursement for live video as well as store-and-forward telehealth, remote patient monitoring (RPM), and audio-only telehealth.

While all states offer reimbursement for live video-based telehealth services, only 33 states reimburse for store-and-forward telehealth, 37 for RPM, and 43 and Washington, DC, for audio-only telehealth.