Telehealth services have already shown and proved the potential they possess to make a positive impact on people’s lives. It is delivering care to patients who may not have access to nearby or affordable health facilities. This can help improve health outcomes, lower costs, and enhance the quality of life.

Virtual care is not without its challenges. One of the biggest hurdles—is getting licensed and credentialed to practice in different states. Each state has its own set of rules, which might differ greatly and change regularly. This can make obtaining and maintaining the requisite qualifications to deliver services across state boundaries complicated and time-consuming for telemedicine providers.

In this article, we will explore telehealth licensing and credentialing, discuss some of the barriers and opportunities, and discover best practices for ensuring compliance and privileges.

What are the Licensing Options for Telehealth Providers?

Telehealth providers are subject to the regulations of both federal and state governments. The federal government establishes healthcare quality and safety standards, as well as administers the Medicare and Medicaid programs. The state governments are responsible for licensing and disciplining healthcare professionals, as well as defining the scope of practice and telehealth modalities for each profession.

Some states require full licenses with the same privileges and responsibilities as in-state providers. However, there are some disadvantages, such as losing state autonomy, having to pay additional fees, and having to comply with multiple state laws and regulations.

Others offer special or out-of-state licenses that allow telehealth providers to practice in a limited capacity or under certain conditions, such as supervision or consultation. These licenses may have lower fees and less stringent requirements than full licenses, but they may also restrict the number of patients or visits that telehealth providers can have.

Another option for telehealth providers is to join interstate licensure compacts, which are agreements among states to recognize each other’s licenses and facilitate cross-state practice:

Interstate Medical Licensure Compact (IMLC): This compact allows physicians to obtain a license in one state and practice in any other state that is part of the compact. It also streamlines the verification and validation of physician credentials. Currently, 39 U.S. states and one territory participate in the IMLC.

Nurse Licensure Compact (NLC) and Advanced Practice Nurse Compact (APRN Compact): These compacts allow nurses and advanced practice nurses to obtain a license in one state and practice in any other state that is part of the compact. They also enhance the mobility and flexibility of nurses and advanced practice nurses. At the moment, 39 states and territories have joined the NLC. As for the APRN Compact, 3 states have enacted the legislation, and at least 7 are pending.

Physical Therapy Compact: This compact allows physical therapists and physical therapist assistants to obtain a license in one state and practice in any other state that is part of the compact. It also reduces the administrative burden and cost for physical therapists and physical therapist assistants. 29 states are actively issuing and accepting compact privileges

Emergency Medical Service Officials Licensure Compact (EMS Compact): This compact allows emergency medical service personnel to obtain a license in one state and practice in any other state that is part of the compact. It also facilitates the deployment and coordination of emergency medical service personnel across state lines. Currently counts 22 member states.

Psychology Interjurisdictional Compact (PSYPACT): This compact allows psychologists to obtain a license in one state and practice in any other state that is part of the compact. It also enables psychologists to provide telepsychology services across state lines. As of 2023, 31 states, territories, and districts have joined the compact.

The benefits of joining a compact include reducing administrative burdens, increasing access to care, and enhancing collaboration among providers. However, there are also some drawbacks, such as losing state autonomy, paying additional fees, and complying with multiple state laws and regulations.

Read more about the eNLC and IMLC.

Some of the states have also implemented policies and initiatives to facilitate telehealth licensing, especially during the COVID-19 public health emergency. For example, waived or suspended certain licensing requirements, extended temporary practice laws, or enacted legislation to make cross-state licensing permanent or extended. These initiatives seek to improve the availability and accessibility of telehealth treatments for patients in need.

The credentialing process for telehealth providers involves several steps and documents:

  • Completing an application form with information about the provider’s background
  • Submitting copies of supporting documents
  • Undergoing a primary source verification process.
  • Reviewing the application and verification results by a credentialing committee
  • Granting privileges to the provider
  • Re-credentialing the provider periodically

One way for streamlining the process is credentialing by proxy, which has been approved by the Centers for Medicare and Medicaid Services (CMS) and The Joint Commission (TJC). It allows a hospital or facility (the originating site) to rely on the credentialing and privileging decisions of another hospital or entity (the distant site) that employs or contracts with the telehealth provider. This way, the originating site does not have to repeat the credentialing process for each telehealth provider.

It is important to note, that credentialing by proxy requires a written agreement between the originating and distant sites that outlines the roles and responsibilities of each party, such as ensuring compliance with laws and regulations, maintaining quality assurance and performance improvement programs, and sharing information about adverse events or complaints.

Accreditation Standards for Credentialing: What Telehealth Providers Need to Know

Accreditation is a voluntary process that can help telehealth providers demonstrate their commitment to excellence, improve processes and outcomes, and increase credibility and marketability.

Depending on the kind, extent, and modality of the eHealth service, there are many certification systems and criteria for telehealth providers.

URAC is a leading accreditor of digital health and telehealth programs in the United States and internationally. It offers a comprehensive Telehealth Accreditation Program that covers various aspects of telehealth delivery, such as clinical quality, consumer protection, privacy and security, risk management, organizational infrastructure, and performance improvement, and consists of four modules:

  • Core Standards,
  • Consultation Services Standards,
  • Remote Patient Monitoring Standards,
  • Provider-to-Provider Consultation Standards.

ISfTeH—an international society that promotes the development and dissemination of telemedicine and e-health. Its Working Group on Telehealth Standards and Accreditation aims to develop standards and guidelines to enhance the quality of patient-centered telehealth services worldwide.

ISfTeH has developed an International Code of Practice for Telehealth Services that provides a quality benchmark for digital health and care. The Code addresses health in both its clinical and well-being senses and covers topics such as service design, delivery, evaluation, governance, ethics, data protection, interoperability, and user involvement.

Telehealth Compliance Challenges

To safeguard yourself and your patients from possible damage, you must adhere to a variety of legal and ethical norms. Failure can result in significant consequences including legal action, fines, penalties, sanctions, loss of licensure, reputational harm, and even patient injury.

Security breaches: telehealth involves the transmission and storage of sensitive health information over digital platforms and devices. This data may be subject to unauthorized access, theft, loss, or corruption as a result of hacking, malware, or human error.

Breaches can jeopardize the confidentiality, integrity, and availability of health information, causing harm to patients and providers.

Data privacy violations: Virtual care providers must follow the federal Health Insurance Portability and Accountability Act (HIPAA) as well as various state and municipal regulations that govern the collection, use, disclosure, and disposal of health information.

Fraud and abuse: can include billing for services not rendered or medically unnecessary, upcoding or unbundling services, falsifying records or documentation, violating anti-kickback or self-referral laws, or misrepresenting credentials or qualifications.

Malpractice claims: telehealth professionals also need to exercise professional judgment, competence, skill, and diligence in providing telehealth services, as they are often required to obtain informed consent from patients, document their services appropriately, follow clinical guidelines and best practices, and refer patients to other providers when necessary. Legal action for medical malpractice might result from errors or omissions in diagnosis, treatment, or follow-up; failure to get informed consent; violation of confidentiality; or patient desertion.

How to Ace Telehealth Provider Credentialing

1. Establish clear policies and procedures

Telehealth providers should have written policies and procedures that define the scope, criteria, process, and documentation of credentialing, which should be consistent with applicable laws, regulations, accreditation standards, payer requirements, and professional guidelines.

2. Verify provider qualifications

Verification should be done periodically to ensure that provider qualifications are current and valid through primary sources.

3. Ensure provider competency

Regular competency assessment should base on established standards and criteria, such as clinical protocols, performance indicators, peer review, patient feedback, simulation exercises, or continuing education.

4. Maintain provider records

Records should include documentation of provider qualifications, verification sources, competency assessment results, credentialing actions, and any complaints or grievances. It is critical to keep them safe and confidential, as required by law or policy, and to keep them for a required amount of time.

5. Comply with legal and regulatory requirements

Telehealth providers must follow all federal, state, and local rules and regulations governing telehealth practice, including license, the scope of practice, informed consent, privacy and security, malpractice insurance, and payment.

6. Seek accreditation

In addition to gaining recognition, credibility, and marketability among payers, regulators, peers, and patients, accreditation can also help identify gaps and opportunities for improvement in your practice.

7. Follow best practice guidelines

Best practice recommendations can serve to improve clinical results, patient satisfaction, workflow efficiency, and cost-effectiveness in telehealth practice, as well as address frequent problems and impediments.

  • The U.S. Department of Health and Human Services offers a website with best practice guides for a variety of telehealth applications, including behavioral health care, chronic conditions, direct-to-consumer care, emergency departments, HIV care, maternal health services, physical therapy, rural areas, school-based services, and training and workforce development.

Credential Management Systems: How They Work and Why They Matter for Telehealth

Credential management systems are software solutions that help telehealth providers manage and store their credentials, such as licenses, certifications, and privileges. These systems can make the credentialing process easier and faster, which is usually complicated and time-consuming.

At Credsy, we are committed to helping you grow your provider network. Our credentialing software has helped healthcare businesses across the US save more than 100,000 hours of administrative work, cutting down onboarding time by 80% and credentialing providers up to 65% faster.

We monitor, secure, and store data for your organization. So you stay compliant – and avoid fines from state regulators. Want to join a specific hospital or healthcare system? We’ll handle the application for you - and get you privileged.

With Credsy you will eliminate the administrative hassle and start serving more patients.

FAQs about Licensing and Credentialing for Telehealth Providers

Why are licensing and credentialing important for telehealth providers?

Licensing and credentialing are crucial to ensure compliance and privileges in a digital world. It is the gold standard for conforming to the rules, regulations, and guidelines that regulate telehealth practice. Besides, they are vital to receiving the authorization to provide specific services at a specific site or setting.

How can telehealth providers obtain and maintain their licensing and credentialing?

Telehealth providers need to obtain and maintain their licensing and credentialing in both the state where they are licensed (the distant site) and the state where the patient is located (the originating site). As a result, both states' rules and regulations involving licensing, scope of practice, prescription, payment, fraud, abuse, privacy and security, and informed consent must be followed. Telehealth providers may also need to obtain and verify their privileges to practice at the originating and distant sites where they provide telehealth services.

How can I integrate telehealth into my practice?

To incorporate telehealth into your practice, you must first analyze your practice's preparedness and feasibility for telehealth, then select an appropriate telehealth platform or solution, train and educate yourself and your team, inform and educate your patients, and then implement and evaluate your telehealth services.

How can I collaborate with other healthcare professionals through telehealth?

To collaborate with other healthcare professionals through telehealth, you can use live videoconferencing for real-time communication, store-and-forward for sharing information, remote patient monitoring for collecting and transmitting data, and mobile health for sending text messages, alerts, or reminders.

What are the laws and regulations for telehealth providers?

Telehealth licensing regulations vary by state and can be complex. In general, digital care practitioners must be licensed in the state where the patient resides. During the COVID-19 pandemic, many states issued emergency waivers that allowed healthcare providers to offer telehealth services across state lines without obtaining additional licenses. However, these waivers are temporary.

Read more about Telehealth Licensing Regulations

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