Telehealth has rapidly transformed the healthcare landscape, becoming a vital tool for delivering care beyond traditional brick-and-mortar settings. The numbers speak for themselves: a study published in Health Affairs found that telehealth utilization soared by 38 times compared to pre-pandemic levels. As this reliance on virtual care grows, so does the complexity of the regulatory environment. Staying ahead of these changes is no longer optional; it's essential for healthcare providers to ensure compliance, maintain quality care, and optimize telehealth service delivery.
This blog post provides a comprehensive update on the key telehealth services and policy changes for 2025 that healthcare providers need to know.
What gets you ready to provide telehealth service?
In most situations, both federal and state regulations require healthcare providers to hold a valid medical license in the state where they are physically located (known as the “distant site”) and in the state where the patient is receiving care (the “originating site”). For example, if you’re based in Texas and provide a telehealth consultation to a patient residing in New York, you must be licensed to practice medicine in both states.
The good news is that many states have implemented licensure pathways or special allowances—often referred to as cross-state licensing—that make it easier for out-of-state providers to offer telehealth services. These provisions typically come with specific criteria that must be met, such as applying for a temporary license or registering with the state’s medical board. Because these rules vary by location, it’s essential to understand and comply with each state’s individual telehealth licensing requirements before delivering care.
Telehealth Licensing Requirements
Licensing for telehealth varies by state, but the Interstate Medical Licensure Compact (IMLC) makes it easier for eligible physicians to obtain licenses in multiple states. Check imlcc.org for the latest list of participating states.
The Uniform Application for Licensure also simplifies multi-state licensing by letting providers submit one set of credentials for use across several boards. To find out if this system is accepted by your state board, consult the list of participating states on the Federation of State Medical Boards website.
Credentialing for Telehealth
To provide telehealth services, a provider must be credentialed and have privileges at the facility they’ll be working for, even if they’re not on-site. This can be done through traditional in-house credentialing or credentialing by proxy, where remote providers are credentialed by a hospital they won’t physically work at.
Update to Medicare Telehealth Policy in 2025
The U.S. federal government introduced several initiatives to fast-track the adoption and visibility of telehealth. While some of these flexibilities are now permanent, others are still temporary. Current policies include:
Extensions of telehealth access options
- Medicare patients can receive telehealth services for non-behavioral/mental health care in their home through September 30, 2025.
- There are no geographic restrictions for originating sites for Medicare non-behavioral/mental telehealth services through September 30, 2025.
- Telehealth services can be provided by all eligible Medicare providers through September 30, 2025.
- Federally Qualified Health Centers (FQHCs) and Rural Health Clinics (RHCs) can serve as Medicare distant site providers for non-behavioral/mental telehealth services through September 30, 2025.
- Medicare patients can receive telehealth services for behavioral/mental health in their homes.
- Behavioral/mental telehealth services can be delivered using audio-only communication platforms.
Rural health
- FQHCs and RHCs can serve as Medicare distant site providers for non-behavioral/mental telehealth services through September 30, 2025.
- For services using interactive, real-time audio and video telecommunications technology or certain audio-only interactions (if the patient can't or won't use video), payment to RHCs and FQHCs will be subject to the national average payment rates for comparable services under the physician fee schedule (PFS) until December 31, 2025.
- Non-behavioral/mental telehealth services in Medicare can be delivered using audio-only communication platforms through September 30, 2025.
- Interactive telecommunications systems may permanently include two-way, real-time audio-only communication technology for any telehealth service furnished to a patient at home if the distant site physician is technically capable but the patient is not capable of or does not consent to the use of video technology.
- FQHCs and RHCs can permanently serve as Medicare distant site providers for behavioral/mental telehealth services.
- Medicare patients can permanently receive telehealth services for behavioral/mental health care in their home. There are no geographic restrictions for the originating site for Medicare behavioral/mental telehealth services.
Behavioral Health
- FQHCs and RHCs can now permanently serve as distant site providers for behavioral and mental health telehealth services under Medicare.
- Medicare beneficiaries may continue to receive behavioral/mental health telehealth care from home on a permanent basis.
- Geographic restrictions on the originating site have been permanently removed for Medicare behavioral/mental health telehealth services.
- Audio-only platforms are permanently allowed for delivering behavioral/mental health services through Medicare.
- Marriage and family therapists and mental health counselors are now permanently eligible to serve as distant site telehealth providers under Medicare.
- In-person visits within six months of the first telehealth session and annually after are not required through September 30, 2025. For FQHCs and RHCs, this requirement is delayed until January 1, 2026.
How to Bill for Telehealth
As of January 1, 2025, the updated Medicare Physician Fee Schedule (PFS) from CMS has taken effect, ending the temporary payment increases that were in place for 2024. On average, this means a 2.83% decrease in reimbursement for physicians and other healthcare providers. Note that this is not a flat reduction—payment adjustments vary by service type.
In addition, state-level legislation continues to evolve, with ongoing reviews of telehealth billing rules for both private insurers and CMS-covered services. For the latest updates, refer to official resources on federal Medicare and Medicaid telehealth policies.
Conclusion
As telehealth continues to evolve, so too must the approach of healthcare professionals navigating this dynamic field. Understanding current policies, licensing requirements, and billing procedures is essential not only for compliance but also for delivering high-quality, accessible care to patients across the country.
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