Are State Medical Boards Supporting or Stifling Telehealth?

The drumbeat to expand interstate licensure compacts to boost telehealth adoption is growing louder.

The latest salvo comes in the form of a blog in Health Affairs. The article, published today and authored by Eli Y. Adashi, Barak D. Richman and Reuben C. Baker, highlights the impact made by state medical boards in both advancing and curtailing connected health innovation. It urges both federal and state regulators to keep a tight rein on SMBs, while also asking the medical profession to “reconsider the role of its SMBs” and reform from within.

That includes embracing the Interstate Medical Licensure Compact and other arrangements that enable healthcare providers to practice in multiple states, and guiding efforts to enable more care providers to deliver care, often with the help of telemedicine technology.

In their article, Adashi, a faculty member at Brown University; Richman, the Bartlett Professor of Law at Duke Law Schools; and Baker, who is pursuing a family medicine residency training program in Boise, ID, trace the evolution of SMBs from 1859 to the present day, where they see a collection of organizations that have in some cases upheld the principles of free market competition while in other cases moving to exert too much control over the market.

With regard to telehealth, they cite the effects of the long-running battle between the Texas Medical Board and Teladoc, the Texas-based telehealth company that ran afoul of the board in 2011 when it began offering services in the state without a face-to-face consult. Teladoc and the board fought for several years over the concept of requiring an in-person exam to establish a proper doctor-patient relationship.

In 2017, with the Federal Trade Commission siding with Teladoc in the courts, the debate came to a close with the state Legislature’s passage of the Telemedicine and Telehealth Services Act, which eliminated the need for an in-person exam before beginning telehealth treatment.

In this and an earlier debate in North Carolina over efforts by the North Carolina Board of Dental Examiners to exert control over non-dentists offering teeth-whitening services, the Health Affairs article argues that SMBs are finally being checked in their efforts to exert excessive control over new and unique healthcare services, such as telehealth. Those efforts, the authors say, unfairly restrain free market completion in the healthcare space.

“Living in the antitrust shadow, SMBs, no longer shielded by the state action doctrine, would do well to refrain from impeding competition,” the article notes. “The views of the FTC and of the (Justice Department) with respect to such forays have been made amply clear. Their joint call to uphold the principles of free market competition must not go unheeded.”

Moving forward, the authors call for SMBs to be more accepting of new telehealth services as well as expanding the playing field for healthcare providers, by allowing more providers (such as nurse practitioners) to practice and giving providers more opportunities to practice across state lines.

“SMBs continue to maintain unnecessary restrictions on good medicine,” the article says. “Many continue to resist ceding authority to non-physicians, undermine cross-state reciprocity compacts while jealously controlling their exclusive state licensure regimes, and use their regulatory authority to impede innovation. As health care costs continue to outpace inflation, the urgency to remove SMB-sustained inefficiencies remains pressing.”

“The FTC deserves enormous credit for both identifying the economic harm inflicted by SMBs and for targeting SMBs with its limited litigation resources, but it cannot become complacent,” the article continues. “State attorneys general should also enforce state consumer protection laws to counter SMB abuses, and Congress would do well to consider reforms to obsolete elements of state-based licensure fiefdoms. And we should celebrate the repeated and unambiguous affirmation of competition principles by the courts, which have a spotty record in enforcing the antitrust laws. Continued success in federal courts will require a continued justification and prioritization of competition in health care markets.”

By urging federal and state regulators to continue to hold the SMBs’ feet to the fire, and by calling on the physician community to press for reform, the authors envision the emergence of a new type of state medical board.

“SMBs could not only embrace the value and rigors of competition, but they also might provide useful leadership in encouraging physicians to pursue reform,” they conclude. “In short, the new SMB could be one that abandons its role as an ossified gatekeeper and crafts a visionary role for expanding consumer welfare and professional dynamism.”