Health IT

3 regulatory and financial barriers to telemedicine (and possible solutions)

Before telemedicine can explode in use and deliver on its promise of better access and reduced cost, a few issues need to be overcome.

A study recently published in the journal Telemedicine and e-Health identified three regulatory and financial (as opposed to technical) barriers to telemedicine: physician licensing, physician credentialing and reimbursement, Becker’s Hospital Review reported.

While the field of telemedicine — the remote delivery of patient care — has been around for decades, state laws and industry practices continue to lag the technology.


Below is a description of each barrier identified in the study, along with a possible solution to each.

Reimbursement: This is the big one. Doctors and hospitals aren’t going to have much interest in providing telemedicine services, or buying the equipment needed to deliver them if they aren’t confident that they’ll get paid to offset those costs. Only a handful of states have passed laws around private payer reimbursement for telemedicine, and as is always the case with state laws, the specifics vary from state to state. Government payers like Medicare have their own set of limitations around telemedicine reimbursement, too.

The fix: It’s hardly complicated. Private insurers and the government need to loosen up their policies around payment to providers for telemedicine services or the telemedicine industry isn’t likely to go anywhere. You can’t hold off the advances of technology forever, so reimbursement reform around telemedicine seems more a question of when than if.

Physician licensing: Physicians need licenses for each state in which they practice telemedicine, in addition to a license in the state in which they physically practice medicine. That can be a problem for numerous reasons, including variations and sometimes conflicts among  laws in different states. Plus, the licensing process can be complicated, lengthy and expensive.

The fix: A national telemedicine license. The American Telemedicine Association has created a website,, dedicated to this issue.

Physician credentialing: Somewhat similar to licensing, physician credentialing involves verifying information about doctors to ensure that they’re in good legal standing eligible to practice medicine. This can be a problem for hub-and-spoke health systems because a physician must be credentialed to work at each individual hospital in the organization. That can be a time-consuming, documentation-intensive and painful process.

The fix: Credentialing by proxy, in which a physician credentialed at the hub hospital is covered for all the spoke hospitals in the system. Electronic credentialing is another approach that could help save time and make the process less painful.


[Photo from flickr user Marcin Wichary]