Federal Licensure: 100 Years Later, the Central Questions Haven't Changed Much

Medical regulators are familiar with the concept of national licensure for physicians, which has been proposed at various times over the last century. An editorial from the Quarterly of the Federation of State Medical Boards, for example, made the legal case for national licensure in 1914:

In reading the commentary by Mr. Clapper, we have to admit that it is an intriguing vision. The idea of national licensure is tempting in its simplicity. Imagine one centralized agency where all applicants would send standardized forms and checks for any money that is owed, and where uniform laws would be applied to everyone. You know, just like the Internal Revenue Service. And don't we all love the IRS?

In all seriousness, though, as governmental employees, we sincerely believe that the government exists to benefit its citizens and its goal is to ensure their “general welfare.” As noted by Manford Clapper in his editorial, this idea is the bedrock of our political system, and that cannot be disputed. However, what Mr. Clapper failed to recognize is that because this responsibility is so great, it was actually divided up by our founding fathers between the federal and state governments. The 10th Amendment to the Constitution outlines this very clearly in stating that all powers not expressly granted to federal government are reserved for the states.

Mr. Clapper reasons that federal medical licensure is constitutional on the grounds that Congress has authority to oversee the welfare of its citizens. However, if this were the litmus test as to the authority of the federal government, there would be very little, if anything at all, that would not fall within its jurisdiction. Despite the author's postulation that the Supreme Court would uphold a national licensing board in a future case, the intervening century has seen nothing from the U.S. Supreme Court that fundamentally changes states' oversight of medical licensing and discipline.

All that said, let us explore for a moment, rather than contest, the federal oversight Mr. Clapper endorses. Indeed, the notion of a national medical license is back on the table, but for reasons unimagined a century ago — namely, the rise of telemedicine.

Consider the following: Prospective physicians take a nationally available licensing exam, so why not issue a national license — especially when telemedicine offers a future where doctor and patient meet in virtual exam rooms? Sounds reasonable. But a closer look at how state medical boards protect the public reveals that the regulation of medicine — and the due process afforded to licensees—is a complex, personnel-intensive process.

For starters, physician applicants undergo a thorough review as part of the licensure process. The first hurdle to national licensure would be stakeholders coming together and agreeing upon a single set of qualifying standards for licensure. As the saying goes, if you've seen one medical board's standards, you've seen one medical board's standards. Each board is unique, for reasons that developed to meet the needs of its home state. This is not to suggest that a single set of qualifying standards would be impossible; but rather to point out the complexity of such an undertaking. Secondly, national licensure would not eliminate the need for a trained workforce to analyze application materials from thousands of prospective licensees annually. These needs and costs would still exist, but would likely be funneled to one office rather than be distributed widely as they are now, and thus the benefits to sharing the workload would be lost.

While there would be many challenges in setting up the licensing component, these would pale in comparison to the disciplinary aspects of the system, such as the need for investigation of complaints. Most state medical boards currently expend the vast majority of their resources on this function. Some investigations, such as those involving pill mills, require physical inspections. Here, too, national guidelines would have to be set in order to govern the process for complaint handling, investigation and resolution.

Some might argue that one way to solve this issue would be the creation of a federal license, leaving enforcement activities related to licensing to the states. But this solution creates as many problems as it solves.

For example, consider this scenario: A Texas doctor, already licensed in the state, obtains the new “federal” license. One aspect of his practice includes telemedicine: Though he lives in Dallas, he treats patients located in Santa Fe, New Mexico, which is about 650 miles away. This should work perfectly…until something goes wrong. The patient is left without any immediate assistance from his or her original provider. New Mexico, which has no authority over the provider, can do nothing to protect its own citizens. Texas can try to investigate, but it is limited by its own subpoena power to evidence located within its own state, and if any of the evidence is located in New Mexico it will not be available in Texas.

But what if a law passes stipulating that with a federal license, the state in which the physician received his originating license is granted subpoena power in another state? Even if the Texas board can extract information and/or testimony located in New Mexico and takes action against the Texas physician, this doesn't impact his federal license.

To resolve this issue, the federal agency would need authority so that measures taken by a state board could be applied to the federal license. But even more issues now appear: What happens should the hypothetical physician presented here contest the action against the federal license? In this mix of state and federal jurisdiction, who prosecutes the case? Who hears the case? One of the already heavily burdened federal courts?

Funding is another matter that would have to be addressed in a federal system. Every state has a licensure fee that allows for a throrough evaluation of licensing applications, competent investigation of complaints and educational efforts to inform licensees of medical regulations. These costs would still continue to exist, though the overall amount of funding would decrease since physicians would only have one license rather than multiple licenses. The charge for a federal license could be increased in an attempt to cover these costs. It is likely, though, that the cost would have to be several times the current licensure fees in order to approach the current levels of funding. Moreover, political pressure would certainly be exerted to keep fees low. With all of this in mind, when does the creation of a federal license begin to undercut the funding of individual state medical boards?

Interestingly, the debate about whether a national licensing system could be imposed by the federal government is likely moot. It has been established that the federal government can gain compliance from the states by making their participation in national programs or guidelines optional, but at the same time tying their participation to national funding for other programs. A national medical licensing system of some kind may be in the future of medical regulation, but it would require a sea change in philosophy, process and funding that would take time to implement. It is unlikely that a sweeping mandate, quickly issued, would be successful.

Much more innovative thinking on the complex issue of federal licensure will be required before it is likely to move forward in the United States. The topic is just as relevant in 2013 as it was in Manford Clapper's day, and the conclusions that can be drawn haven't changed much: Achieving the efficiency benefits of federal licensure may bring additional costs that are simply too high to pay.