Permissive Telehealth State Licensure Policies Are Associated with Increased Telehealth Utilization

Background: State professional licensure has been cited as a significant barrier to widespread telehealth adoption, and states have developed strategies to reduce such licensure burdens through policy changes. We aimed to measure the association between state-level medical licensure policies and outpatient telehealth utilization between 2018 and 2022 among Medicare beneficiaries. Methods: We conducted a quasi-experimental study of a 5% sample of age-qualifying Medicare fee-for-service beneficiaries between January 2018 and December 2022. We assessed state-level medical licensure policy for telehealth visits, captured as participation in Interstate Medical Licensure Compact (IMLC) before the COVID-19 public health emergency (PHE) and/or policy relaxation during the COVID-19 PHE. Outcomes included out-of-state telehealth (OOS-TH) and in-state telehealth (IS-TH). We evaluated the association between state-level policies and outcomes through logistic regression, adjusting for patient-level characteristics and month/year of the encounter. Results: We analyzed 141,199,029 outpatient encounters for 1,682,501 Medicare beneficiaries. In the pre-COVID-19 era, IMLC participation was associated with higher OOS-TH (adjusted odds ratio [aOR]: 2.24; 95% confidence interval [CI]: 2.09-2.40) but not IS-TH (aOR: 0.98; 95% CI: 0.96-1.01). In the COVID-19 era, we observed higher IS-TH in IMLC-only states (aOR: 1.09; 95% CI: 1.08-1.10) and states with COVID-19 policy relaxations (aOR: 1.11; 95% CI: 1.10-1.12). We observed lower OOS-TH utilization by IMLC participation (aOR: 0.74; 95% CI: 0.72-0.75) and COVID-19 policy relaxations (aOR: 0.83; 95% CI: 0.81-0.85). Conclusions: Permissive licensure policies were higher telehealth utilization, though we observed mixed effects in telehealth type (IS-TH vs. OOS-TH) and by time (pre-COVID-19 vs. COVID-19). Variability in IS-TH and OOS-TH utilization may indicate that while local policies can improve telehealth access, interstate barriers still exist.