As discussed in Part 1 of this series, there are important benefits to licensure compacts, but providers must understand that the benefits come with added compliance responsibilities. Providers who apply for cross-border licensure through PSYPACT, the Counseling Compact, and the Social Work Compact must comply with the laws and rules of the state where the provider practices.
This means that the provider must have some familiarity with the laws of those states as they relate to the provider’s behavioral health practice. Failing to do so could have dire consequences, as discussed below.
Bottom line: Choose practice states carefully. While the compacts ease authority to practice burdens, they do not absolve providers of ensuring compliance with rules everywhere they practice. Consider at least the following areas of compliance.
Privacy and Confidentiality
Providers practicing in another state under an interstate licensure compact must take care to understand and comply with that state’s confidentiality laws. While HIPAA establishes a federal baseline for privacy protections, many states, particularly in behavioral health and substance use disorder contexts, impose stricter rules around the use and disclosure of client information.
When state law is more protective than HIPAA, the state law controls. Providers delivering care across state lines must therefore be aware that the confidentiality requirements of the client’s home state may differ significantly from those of their own and must adjust their practices accordingly to remain compliant.
This may require changes to intake paperwork where the provide outlines confidentiality rules or changes to internal policies addressing the protection of client information when subpoenaed or ordered by a court. Further, a state-specific confidentiality rule may impact whether the provider can release client information to a state-wide health information exchange (HIE) without the explicit written consent from the client.
For example, here in Connecticut, the law protecting communications and records maintained by most behavioral health providers requires explicit written consent of the client. Based on that requirement, behavioral health providers cannot send information to the state-wide HIE, Connie, without such consent for Connecticut clients. For clients in other states, the laws of those other states would apply.
Telehealth Rules
When providing telehealth services under a licensure compact, behavioral health providers must comply with the telehealth laws of the state where the client is located. These laws can vary significantly between states and may impose different requirements regarding informed consent, documentation, and technology standards.
For example, some states require verbal or written consent specifically for telehealth, while others may mandate specific disclosures or limit certain types of services via telehealth. The Center for Connected Health Policy offers a website that tracks various telehealth requirements in the 50 states. Consent and documentation requirements are detailed under “professional requirements.”
Supervision
Each state’s licensing board governs supervision standards, including who may supervise, what qualifications are required, and how supervision must be conducted and those requirements can differ significantly from state to state. Additionally, even if a provider is authorized to practice clinically under the compact, supervision privileges are not necessarily included. Before agreeing to supervise a trainee or pre-licensed professional in another state, providers must review and comply with that state’s specific supervision requirements to ensure they are eligible and acting within the scope of their authority.
PSYPACT offers a helpful flow chart that addresses the issue of supervision for psychologists.
Other State-specific Laws
Every state has its own legal and regulatory requirements for core practice issues such as treating minors, obtaining consent, and maintaining clinical documentation. These requirements can vary widely and may include specific rules about parental consent, age of consent for mental health treatment, and how records must be kept or disclosed. Relying solely on one’s home state standards can lead to compliance issues.
Providers should consult the laws of the client’s state and consider reaching out to the local chapter of their professional association, which often offers guidance, summaries, or practice resources specific to that jurisdiction.
Adverse Action
Each behavioral health licensure compact includes provisions explaining how member states handle adverse actions, such as license suspension, revocation, or other disciplinary measures. Although each compact uses a different structure, their adverse action provisions share common goals. An adverse action in one state can result in consequences in others. Importantly, the compliance issues described above can trigger these adverse actions.
Every compact member state must report any disciplinary action taken against a provider to a central database shared by all member states. If a provider is disciplined in their home state, their ability to practice in other compact states is typically suspended automatically. In other words, the provider loses the ability to practice in their home state and in every compact state.
Importantly, the reverse can also happen. Disciplinary action in a remote state can lead to consequences in the provider’s home state, including suspension or revocation of their main license. This means a single violation in one state could stop a provider from practicing anywhere under the compact. This is why it is so critically important to know and follow all rules and requirements in both the home and remote states.
Conclusion
The pandemic opened our eyes to the power of telehealth and licensure compacts helped to clear licensing hurdles allowing behavioral health providers to expand their practices across state lines. Providers, however, must not lose sight of key compliance considerations. While the compacts aligned licensure across member states, they did not streamline other compliance obligations. And, as explained above, failure to comply can impair a provider’s ability to practice in any of the compact states.