All professional licensing laws have some component of trade regulation that is driven by the affected profession’s interest in limiting competition. State licensing agencies for lawyers have fought to prevent nonlawyers from helping people with divorce filings, to prevent the publication of self-help legal books on estate planning, and to limit the extent that real estate brokers can assist with the documents for selling real estate. In medicine, trade restrictions were the traditional focus of regulations. It is only in the last few decades that medical licensing agencies in many states have even had the legal authority to discipline a physician for incompetence.

Telemedicine has been promoted as a way to deliver medical services to remote areas that would otherwise not have access to expert physicians. Politically, this is the best way to diffuse criticism because it does not threaten the livelihood of other physicians. Realistically, however, it will be impossible to restrict telemedicine to such areas. If I am an insurer, I can lower costs and perhaps improve the quality of care for my insureds by contracting with a leading medical center for specialty consultations with local general practitioners. Thus a patient in Atlanta might be able to get a consultation from a Mayo Clinic physician, but at a lower cost than a local specialist because the patient’s primary care physician will manage the consultation. The specialists will be under pressure to price these consultations attractively. They are already losing business because MCOs are unwilling to send patients to regional centers for specialty care. The specialists can essentially extend their franchise at the cost of a fast Internet connection, with no added office expense or capital expenditures.

Given that many specialties have more practitioners than the patient flow warrants, especially if the patients could shop over a broader region, telemedicine is very threatening. This extends down to the primary care physician level: one of the claims for telemedicine is that it will enable communities that can only support a nurse to have physician care available under the direction of the nurse. Once this is accepted, there is no reason why MCOs would not want to use it for all their primary care patients.

Medical licensing agencies and medical care practitioner professional organizations must work out a balance between the importance of hands-on physician care and the obvious advantages of leveraging medical expertise. Such leveraging can both reduce costs and increase the quality of patient care, although at the expense of local practitioners.