Veterans' Affairs:

Potential Costs of Changes in Licensing Requirement Outweigh Benefit

HEHS-99-106: Published: May 21, 1999. Publicly Released: May 21, 1999.

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Stephen P. Backhus
(202) 512-7111


Office of Public Affairs
(202) 512-4800

Pursuant to a congressional request, GAO provided information on whether changing Department of Veterans Affairs (VA) health care personnel licensing requirements would effect VA's health care system, focusing on: (1) comparing VA's physician employment requirements and processes with those of other federal agencies; (2) comparing VA's requirements with those of private sector health care organizations; (3) the potential benefits and costs of requiring VA physicians and registered nurses to be licensed in the state where they practice; and (4) the implications of such a licensing change on VA's use of telemedicine.

GAO noted that: (1) generally, VA and other major federal agencies, such as the armed services and Public Health Service, that employ physicians to provide medical care use similar employment practices; (2) these agencies require physicians to be U.S. citizens, possess a current license to practice medicine from any state; have graduated from an approved medical school program with a Doctor of Medicine or Doctor of Osteopathy degree; have completed at least a 1-year internship, residency or fellowship; and have undergone a suitability investigation for federal employment; (3) beyond these basic requirements, VA requires its physicians to demonstrate English proficiency and pass a physical exam; in 1997, it also began requiring newly hired physicians to be board certified in a medical specialty; (4) in contrast, in accordance with state laws, private sector physicians must be licensed in the state where they practice; (5) also, unlike VA, less than half of the health maintenance organizations and preferred provider organizations GAO contacted require U.S. citizenship, board certification, or demonstrated English proficiency, and none require a physical exam; (6) the potential costs to VA of requiring physicians and registered nurses to be licensed where they practice would likely exceed any benefit; (7) if the licensing requirements were changed, up to 14 percent of VA's physicians and 13 percent of VA's registered nurses would have to obtain new state licenses or transfer to VA facilities located in states where they are licensed; (8) VA believes the costs and burden generated by such a change would outweigh any benefits to its operation; (9) supporting this view, literature shows no linkage between differences in state licensing practices and quality of care; (10) likewise, individuals representing physician and nursing boards told GAO that the quality of patient care and differences in state licensing practices are not directly linked; (11) the impact of a licensing change on telemedicine would likely be modest; (12) VA expects that its telemedicine activities that cross state lines would be significantly hampered by requiring physicians and registered nurses to be licensed in every state where they provide care through telemedicine; and (13) however, GAO found that many state laws exempt VA providers from their licensing requirements when they practice telemedicine.

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