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Geographic Expansion via Telehealth: First, You Need a Business Plan

by | Nov 19, 2020

Telemedicine has been thrust into the forefront this year, yanked from a marginal “early adopter” technology into the spotlight as table stakes for any practice that wanted to survive the COVID pandemic. Now we are entering the inevitable “sawtooth curve” of compound W-curves that will impact the healthcare market into 2021 (at least until both preventative vaccines and ameliorating therapeutics are developed and released).

What we are seeing is that as with any major market disruption, aggressive and ambitious players are quickly calculating the new business opportunities revealed. Telehealth is no exception, and the most forward-looking practice groups, Private Equity MSOs, and other healthcare organizations did not take long to realize that telehealth may provide an ideal vehicle for geographic expansion.

Now more practices are realizing that telehealth can be a vehicle to expand across state lines, and even international borders. As the adrenaline recedes and the quiet rational mind regains pre-eminence, what becomes clear is that today’s new telehealth geographic expansion requires subdued, disciplined process thinking, and a business plan.

Elements of A Telehealth Expansion Business Plan

Here are those steps that must be taken to craft a sound, actionable business plan for geographic expansion via telehealth:

1. Determine if you are currently practicing in an IMLC (Interstate Medical Licensure Compact) state.

The IMLC Commission (IMLCC) has been working since 2013 with the Federation of State Medical Boards (FSMB) to bring together State Medical Boards to agree to accept physician licensure in any member state, if the physician is licensed in any other member state. To date, 29 states have signed on to this compact.

This is an alternative to national licensure, which would have to come from the U.S. Federal Government, by act(s) of Congress, which do not currently exist.

Therefore, if you are currently licensed and practicing in an IMLC state, it’s easier to practice telehealth in other IMLC member states (provided you pay the other states’ licensing fees).

The unfortunate part is that the 31 states which are not yet part of the IMLC include New York, California, Texas, Florida, Connecticut, Massachusetts, and 25 others.

Areas of present opportunity include the upper Midwest, where high-population states such as Illinois and Michigan are members of the IMLC, along with Wisconsin and Minnesota. Many contiguous Great Plains and Rocky Mountain states, as well as a band of Southern states stretching from Maryland to West Virginia down through Kentucky, Tennessee, Georgia, Alabama, and Mississippi, are also IMLC members, creating opportunity for practices in those regions. The full list (and map) of IMLC member states can be found at

Many IMLC advocates are looking to New York state as the next big domino to fall into the IMLC agreement. Legislation to approve IMLC membership for New York was introduced in the New York State Senate in February 2020 (Senate Bill S7732), and currently sits in committee in that legislative body.

Currently, of course, licensed physicians are temporarily allowed to practice across state lines as a COVID emergency measure, per a White House decree on March 18, 2020. But as we all know, such temporary regulatory easement measures (across numerous aspects of healthcare) “for the duration of the pandemic” have no guaranteed, or even predictable, end dates. Thus, it is not prudent to make long-term business plans based on the current situation. Conversely, aggressive and agile organizations could take advantage of this unusual opportunity in the short run, provided they are prepared to adjust if and when the situation changes in 2021 or beyond.

So that’s telehealth expansion business plan hurdle number one – if you can take advantage of the IMLC, that removes many obstacles to your interstate expansion goals. If not, it becomes more complicated, as you will have to explore whether you can gain licensure in the states into which you want to expand.

2. Meet with your Professional Liability Insurance provider to discuss your interstate medical practice expansion plans.

Once you have established a potential vision for your interstate expansion via telehealth, bring in your Professional Liability Insurance / Malpractice Insurance provider – such as The Doctors Company, and discuss your plans with them. The key reason is that just because the IMLC may allow you to practice in another IMLC member state, that doesn’t mean your insurance provider will provide the same (or any) coverage if you practice outside of your home state.

3. Analyze the landscape of private payers in the states into which you propose to expand.

As you well know, depending on your payer mix of CMS (Medicare/Medicaid) and private payers, every state is very different in terms of who those private payers are.  Blue Cross licensees may represent a substantial segment of private payers in any state, but nevertheless, an analysis of who will be reimbursing you, and what new relationships need to be established (and requirements met), is not insignificant, and will represent a big new chunk of work for your billers & coders.

4. Outline a “Phase 1 / Beta” plan of low hanging fruit target patient audiences as a proof of concept and learning phase for your business.

Once you have completed the above three steps to your satisfaction and business viability, then you will need to think about how best to launch your interstate expansion plan.

As with any fundamentally new paradigm, it is often best to “crawl before you walk,” to test your ideas and undergo learning opportunities to validate your future broader vision. In the case of geographic expansion across state lines, logic dictates certain patient population segments as “Phase 1 / Beta” targets. These may include:

  • Current/former patients who have moved to another state. An example would be a Chicago-area practice which has patients that have retired to Arizona. As both Illinois and Arizona are member states of the IMLC, a continuing relationship through telemedicine is not blocked by interstate licensing requirements.
  • Specialty and sub-specialty practices who can serve rural areas (or areas underserved by local specialists and sub-specialists) in nearby states. For example, a pre-eminent sub-specialist in the Atlanta metroplex can consult with and treat patients in states such as Alabama, Tennessee, Kentucky, or Mississippi, which are all members of the IMLC along with Georgia. In this case, marketing and building referral sources would be key. An advantage of relative proximity is that patients who can be consulted with via telehealth have a reasonable opportunity to come to the practice’s location physically if/as special needs arise.

Medical Advantage can help you craft a patient population target segment plan based on your geographic expansion goals, as well as your overall business plan itself, and a detailed operational implementation plan to expand your practice into other states via telehealth.

What about International Expansion via Telehealth?

The sudden and explosive growth of telehealth in 2020 has flooded light on another new horizon – expansion of practices, practice groups, and provider MSOs not only to other states, but to other countries.

Of course, there is a complex matrix of considerations, opportunities, and limiting factors to this concept. Medical Advantage can help you navigate these and vet opportunities.

Although most Western European countries (and Canada) have free national healthcare provided to their citizen taxpayers, creative thought can carve out a couple intriguing areas of opportunity using telehealth.

  • One is foreign cash-customer patients for especially renowned US practitioners. While healthcare is free for the foreign citizens in question, of course those citizens generally must accept the physicians, specialists, and sub-specialists to whom they are assigned by their government. Although, foreign patients of greater wealth and means can choose a US practitioner, if they want to foot their own bill. Food for thought for well-known top of field US doctors with a national (and potentially global) referral reputation.
  • Another opportunity is US citizens who are living, or frequently travel, abroad, and may have US-based health insurance which has an international rider. While not common, there is a subset of corporate employers who add various forms of international coverage to protect their employees when posted abroad. Thus, you as a US-licensed provider can treat your patients while they are abroad and be reimbursed by their US-based private payer. Although perhaps a small subset of patients, this nevertheless represents a patient population for which telehealth uniquely enables international treatment, and can include your own current/past patients as well as new patients (acquired through targeted marketing to corporate employers and/or referrals from insurance company private payer relationships).

From a regulatory and liability standpoint, international telemedicine is still in initial phases.

Medical Advantage and TDC Group can help.

As you can see, the possibilities of geographic expansion for your practice, practice group, or MSO via telemedicine are numerous. At the same time, there is a dense set of practical, technical, and regulatory considerations that need to be examined and addressed to move forward into this new frontier.

Medical Advantage, together with our associated business unit Healthcare Risk Advisors and the overall resources of the TDC Group of which we are a member (a $6B entity serving over 100,000 healthcare providers and organizations as the nation’s largest provider of Insurance, Risk Management, and Healthcare Practice Improvement Solutions) can help your organization map out a prudent business plan for geographic expansion via telehealth.


  • Chad Anguilm

    Chad Anguilm has over a decade of experience conceptualizing, implementing, and refining innovative technology solutions for clients across the healthcare industry.

    As Medical Advantage’s Vice President of Growth, Anguilm is responsible for facilitating strategic partn...

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