States lead the way toward borderless healthcare

Telehealth has swiftly evolved from a niche convenience to a vital element of modern healthcare. The COVID pandemic accelerated its adoption, prompting millions of patients and providers to embrace virtual care. During the height of the pandemic, telehealth visits among Medicare recipients skyrocketed, fundamentally reshaping expectations around healthcare delivery.

However, it has also highlighted a key obstacle: state lines. While an illness knows no borders, medical licensing and insurance rules often stop at the state boundary. The growing consensus is that expanding telehealth across state lines is essential to fully realize its benefits.

When geography fades

Telehealth’s ability to connect patients with providers anywhere holds great promise for improving healthcare access. This is especially true in rural and underserved areas, where specialist doctors or even primary care providers may be few and far between.

By leveraging telehealth across state borders, a patient in a remote community can consult a top specialist from a major medical center hundreds of miles away. For example, a person living in rural Wyoming might receive virtual care from an oncologist in Colorado without the hardship of travel.

These cross-border connections can help address healthcare disparities by bringing medical expertise into communities that lack it. Several states are beginning to recognize this potential and lead by example through cross-border telehealth agreements.

In the Washington D.C. metropolitan region, Maryland, Virginia, and the District of Columbia signed a memorandum of understanding to mutually recognize medical licenses and expedite cross-border telehealth.

This regional pact means a physician licensed in D.C. can more easily treat patients in Virginia or Maryland via telehealth, and vice versa. It effectively expands the pool of available doctors for patients in that tri-state area, which is especially valuable in metropolitan regions where people may live in one state and receive care in another.

Likewise, some states have created special telehealth license or registration programs to welcome out-of-state providers. Florida, for instance, launched an out-of-state telehealth provider registration that allows qualified providers from anywhere in the country to offer virtual care to Florida residents (with certain limits).

Minnesota takes a similar approach, permitting out-of-state physicians to practice telehealth with Minnesota patients as long as they have a clean license record and don’t set up a physical clinic in the state.

Red tape at the border

Despite these advancements, significant regulatory barriers remain. The primary hurdle is licensing. In the U.S., healthcare providers must typically hold a license in each state where their patients reside. This restriction often prevents doctors from offering virtual services across state lines without undergoing the cumbersome process of obtaining multiple state licenses.

During the COVID public health emergency, many states temporarily waived licensing restrictions to allow out-of-state providers to practice telemedicine. This flexibility sparked a surge in cross-border care. However, as emergency declarations expired, so too did many of these temporary allowances, leaving patients once again bound by state-specific rules.

Complicating matters further is the inconsistent patchwork of telehealth regulations among states. Each state defines telehealth differently, with varying rules regarding which services are permitted, how care is reimbursed, and what technologies are acceptable. Some states mandate full reimbursement parity between virtual and in-person visits, while others leave coverage decisions to insurers.

For example, a mental health provider may legally offer teletherapy to a patient across a state line, only to find the patient’s insurance refuses reimbursement. Rules on prescribing medication via telehealth, patient consent, and record-keeping also differ by state, creating confusion for both providers and patients.

Understandably, states want to maintain oversight and ensure quality care. They have valid concerns about malpractice liability, fraudulent providers, and enforcing professional standards. But these concerns have resulted in a fragmented system, where the administrative burden of securing multiple licenses and understanding differing rules discourages many providers from expanding their reach.

Laying the foundation

To address these obstacles, states and professional boards have been exploring mechanisms to facilitate interstate telehealth while preserving safeguards. One of the most promising tools has been interstate licensing compacts.

The Interstate Medical Licensure Compact (IMLC) is a key example. Covering 41 states, the District of Columbia, and Guam, the IMLC streamlines the licensing process for physicians seeking to practice in multiple member states. While it doesn’t create a single, national license, it significantly reduces red tape by offering expedited licensure pathways. Roughly 80% of U.S. physicians are eligible to participate, and thousands have already done so.

Other professions have followed suit. The Nurse Licensure Compact now includes 41 states, allowing registered nurses to hold one multistate license. Similarly, the psychology field benefits from the PSYPACT compact, which spans over 40 states, enabling psychologists to provide tele-mental health services across state lines.

Beyond compacts, a handful of states have adopted even more direct measures. Arizona, for instance, implemented a universal telehealth law that allows any out-of-state provider in good standing to offer virtual care to Arizona residents without securing an Arizona license. At least six additional states have followed Arizona’s lead, opening their virtual doors to outside clinicians under certain conditions.

Regional reciprocity agreements have also emerged as a flexible solution. The Maryland-Virginia-D.C. pact is a prime model, offering neighboring states an opportunity to collaborate while maintaining oversight. These agreements could serve as blueprints for similar arrangements in other regions, fostering cross-state healthcare networks without the complexity of formal compacts.

Federal action has likewise played a role. During the pandemic, federal waivers allowed Medicare and Veterans Affairs systems to support cross-state telehealth, proving broader reforms are feasible.

The next frontier

States have already begun to redraw healthcare’s borders. Through interstate compacts, licensing reforms, and regional partnerships, policymakers are gradually dismantling the regulatory barriers that tether care to geography. Yet, much work remains.

The challenge is balancing the legitimate need for professional oversight and patient safety with the flexibility to meet modern demands. Telehealth offers the unprecedented opportunity to bridge longstanding gaps in care, especially in rural and underserved areas. If current efforts continue, state lines will become far less relevant, and healthcare access will hinge more on need than on location.

The next frontier for healthcare calls for a system where geography no longer limits care, and innovation is supported by policies as nimble as the technology driving them.