Page 13 Unlocking The Potential of Physician to Patient Telehealth Services The Information Technology & Innovation Foundation

physicians to practice medicine within the state (such as by telehealth) so long as they do so
without compensation. Other states have simply not participated in these efforts or have
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chosen not to adopt the recommendations of the FSMB.

There is not one single explanation for why states have been slow to adopt reforms to make
it simpler for physicians to obtain a license in multiple states, but one reason for this slow
progress is that the medical community has not always embraced policies supporting
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telehealth reform. Officially, the American Medical Association (AMA) now supports
efforts to create uniformity in licensing requirements and improve portability between
different jurisdictions; however, it has opposed efforts to create a single national system of
medical licensing. Moreover, some state medical boards may choose to use their authority
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to protect in-state physicians from competition from out-of-state providers. Other
professional associations have taken similar actions in the past. For example, the American
Optometric Association fought to enact state laws and regulations that would keep patients
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from obtaining contact lenses online.
Insurance Coverage and Compatibility
One of the major barriers to the widespread adoption of telehealth has been lack of
consistent reimbursement policies for telehealth services. Reimbursement policies vary from
state to state. Each state determines whether its Medicaid program will reimburse for
particular telehealth services and under what conditions. For example, some states only
reimburse for telehealth services in certain geographic regions, such as rural or underserved
areas within the state. Others restrict patients from obtaining telehealth services in their
home, instead requiring them to be at a clinic.

Overall, every state’s Medicaid program except Iowa, Massachusetts, New Hampshire,
New Jersey, and Rhode Island reimburses at least some telehealth services, such as live
video encounters. However, only seven states (Alaska, Arkansas, Hawaii, Illinois,
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Minnesota, New Mexico, and Vermont) allow Medicaid reimbursements for “store-and-
forward” services such as tele-dermatology which happen asynchronously. Only ten states
(Alabama, Alaska, Colorado, Kansas, Louisiana, Minnesota, New York, Texas, Utah, and
Washington) offer Medicaid reimbursement for remote patient monitoring in the home.
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States also can determine whether private insurers will reimburse for telehealth services. As
shown in Figure 4, twenty-one states have passed laws requiring private insurers to cover
some form of telehealth. For example, Montana and Virginia require insurers to cover
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telehealth services and reimburse at the same rate they would for in-person services. Other
states, like Georgia, New Mexico, and Texas only require coverage, but do not require that
the reimbursement rate be equal to in-person services. Reimbursement policies have an
impact on telehealth adoption: hospitals are more likely to adopt telehealth if they are in
states requiring private payers to reimburse telehealth services at the same rate as in-person
services.
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