November 5, 2022
Why you should start thinking about your multi-state licensing strategy now, and how to get your providers licensed to meet your patient’s needs.
If you’re in the virtual care delivery space, you’re most likely going to offer services across multiple states, so you’ll need providers who are licensed across state lines. As we discussed in our credentialing chapter, each state has its own professional board that is responsible for licensing physicians, nurses, and other healthcare professionals, so these providers must obtain a valid license for each state in which they want to provide care to patients.
While having providers with multi-state licensure isn’t a requirement to develop your provider network, it can help you maintain a smaller network as you grow your patient population, which makes things like training and quality control less of an operational burden. Many providers who work in telehealth also enjoy being able to treat patients across multiple states, as it offers the opportunity to increase access to care in a way that isn’t possible in an in-person setting.
In this edition of the Virtual Care Playbook, we’ll review the methods through which different provider types can obtain multi-state licensure, explain what a compact license really is (spoiler alert: there’s more than one!), and discuss some options for licensing solutions. And by “solutions”, we mean ways to make licensing slightly less painful.
The timeline for obtaining a physician license (MD or DO) in a new state varies greatly depending on the application process and the state board. Typically, for non-compact applications, you should expect the process to take several months from start to finish. Aside from completing the application and gathering the required materials (which usually involves a notary and set of fingerprints, and sometimes professional references), the boards have to process the application and then meet to approve or deny it (meetings are typically once a month). Some states, like Massachusetts, are notoriously strict on granting licenses to out of state providers. Their application process can take years (pro tip: the fewer licenses a physician has, the easier it is to get licensed in MA, so if you know you’ll want to get licensed there eventually, start early!). There are a few ways to speed up the process (depending on the state)- the compact license and the FCVS profile.
There are 29 states (plus Washington, D.C. and Guam) which participate in the Interstate Medical Licensure Compact, or IMLC. Both MDs and DOs can apply for compact licensure through the IMLC. However, holding a compact license does not automatically grant you the ability to practice in other IMLC states. Physicians must still apply to each of the states individually, but the application itself is much shorter, and is processed much more quickly (per the IMLC website it can take “a few days”, but a few weeks is more likely). After being approved for an IMLC license, physicians receive a “Letter of Qualification” that is good for one year, and during that time they can apply for as many company state licenses as needed. Of course, they still have to pay the license fees for each state (plus an additional $100/license to the IMLC).
To be eligible for a “compact license”, the physician must meet certain criteria. They must:
In addition to these geographic requirements, the physician must also meet all of the following:
It seems like a lot, but most physicians who live or work in an SPL state are eligible for the compact, and it’s definitely worth the additional cost to save a lot of time upfront. Here’s a map of the IMLC states (Note that VT and OK are in the IMLC but are not SPLs):
The Federation Credentials Verification Service (FCVS) is operated by the FSMB and allows physicians (and PAs) to create a profile containing primary source documents (like their medical school diploma and existing state licenses). The profile is verified by FSMB and can be used to (or required for) apply for licenses in many states.
[See here for a full list of states that accept or require an FCVS profile.]
While the FCVS profile doesn’t afford physicians any expedited review process for their application, it reduces a lot of the work required on the front end of submitting the application.
For Registered Nurses, the easiest way to get multi-state licensure is to apply for a compact license. The Nursing Licensure Compact (NLC) includes 35 states, and unlike the IMLC, when a nurse applies for and obtains a compact (or multi-state as it’s sometimes called) license, they are automatically licensed in all other NLC states. No applications needed!
To be eligible for compact licensure, a nurse must be a primary resident of an NLC participating state (proof of residency in the form of a driver’s license, state ID, tax return, etc is required for application). Unfortunately, if an RN doesn’t live in a compact state, they are going to have to obtain multiple licenses the old fashioned way- with lots of paperwork!
Here’s a map of NLC participating states:
*Ohio has passed NLC legislation and will enact the NLC on 1/1/23. Pennsylvania, Vermont, and the US Virgin Islands have also passed legislation but do not have implementation dates set.
Currently, there is no active compact licensure for APRNs (Advanced Practice Registered Nurses- includes NPs, CRNAs, CNMs, and CNSs). In August 2020, the NCSBN adopted a compact licensure agreement, but 7 states need to adopt legislation approving the APRN compact before it can be activated. Currently, only 3 states (North Dakota, Utah, and Delaware) have adopted legislation. If the APRN compact does become active, it would apply to APRNs who live in a compact state and have a minimum of 2080 hours of professional practice.
To apply for an NP license, the provider must also hold an RN license in the state, so if the NP is eligible for the NLC, it can make one part of the process a bit easier.
One important factor when considering APRN (or PA) licensure is the state-level regulations that govern the practice of these providers. In many states, Nurse Practitioners can apply for independent practice status that enables them to practice medicine without a relationship with a supervising physician. Usually, an NP has to meet a certain number of practice hours to be eligible. In states without independent practice, or where an individual NP doesn't qualify, there are widely varying requirements for the supervision of these providers. Before pursuing additional licensure for NPs or PAs, you should consider the additional operational overhead that might be required.
Like APRNs, there is no compact license for Physician Assistants (although the AAPA is working on it). In some states, PA licenses are issued by the same board that issues physician licenses, while in other states there are separate entities that regulate PA licensure.
As mentioned above, PAs can create FCVS profiles to make the multi-state licensing process a bit smoother- see here for a list of states that accept FCVS for PAs.
The importance of multi-state licensing for your provider team will depend on your care delivery model and growth strategy, but it’s important to think about your licensing plans well in advance of when they become urgent needs. If you plan on obtaining multiple licenses for a number of providers, there are many licensing services that can assist with the application process and handle any ongoing communication with state boards (boards will often come back to a provider asking for more information or paperwork after an application has been submitted). Typically, licensing services charge an additional fee on top of the application fees for each license.
If you’re considering bringing on a licensing service, be sure to get a good understanding of what aspects of the application process they will take on and what your providers will be responsible for. And communicate that clearly to your providers- these services do not take on the entire process (for example, providers will need to spend time upfront supplying their information and credentials) but they can save a lot of time. And time that your providers are not spending on licensing applications is time they can spend with patients.
When providers hold multiple professional licenses across state lines, the initial application isn’t the only costly and time consuming process they must endure. Each state has different renewal schedules and CME requirements. Some licenses renew on the date they were issued, while others renew based on the providers’ birthdate, and others on a fixed schedule (so yes, you could be issued a license and then have to renew it a few months later). In order to renew a license, most states require providers to complete Continuing Medical Education (CME) courses. Some CME credits can count towards multiple license renewals, while other states have specific courses that have to be completed for each renewal period. The more licenses you have, the more CMEs you’ll need to maintain them (which means more time away from patient care, and more money). Here's a fun guide to CME requirements for physicians from FSMB.
Because of the time, cost, and ongoing maintenance associated with multi-state provider licensure, it’s important to think strategically about where you need to license your providers to build an overall network that can serve the needs of your patients. Even if you are operating in all 50 states, it’s unlikely that all of your providers need to be licensed everywhere, but you do want to build redundancy into your network to avoid any lapses or delays in care. Beyond the business implications, your providers should also feel comfortable with the number of licenses they hold. As much as a licensing service or your own operations team can assist with applications and license tracking, at the end of the day the individual provider is responsible for maintaining the licenses they hold and for any potential liability associated with practicing under those licenses, so their buy-in is imperative.