October 26, 2020

Volume X, Number 300

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October 26, 2020

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Federal Court Enjoins Texas’ Restrictions on Telemedicine

Late last month, a federal district court in Texas enjoined the Texas Medical Board from implementing a rule that would have significantly curbed the use of telemedicine in the state. The decision is a major victory for telehealth proponents in Texas.

Texas is home to Teladoc, Inc., one of the most successful telehealth service providers in the United States. According to the press reports, Teladoc users have completed more than 600,000 physician consultations through telehealth technology, including 140,000 in Texas alone.

The Texas Medical Board and Teladoc have sparred in court for several years. On a few previous occasions, the Board has sought to curb the use of telemedicine, and Teladoc has responded by suing to enjoin the Board’s actions.

In April, the Texas Medical Board issued a rule that would have generally required, effective June 1, 2015, an in-person evaluation prior to making a diagnosis or prescribing medications. The Board’s decision would have effectively prohibited many of the consults provided by Teladoc. Not surprisingly, Teladoc sued in federal court, seeking to enjoin implementation of the rule.

On May 29, 2015, the court granted Teladoc’s motion for a preliminary injunction, thereby halting the June 1 implementation of the new rule. The court concluded that Teladoc was likely to succeed on its claim that the Board’s new rule violated federal antitrust law (specifically, Section 1 of the Sherman Act, 15 U.S.C. § 1). See Teladoc v. Tex. Med. Bd., 1-15-CV-343 (W.D. Tex. May 29, 2015).

This injunction is a significant victory for the telemedicine industry. It keeps open the market for telemedicine in one of the largest states in the country, and it provides support for potential plaintiffs who may be considering challenges to similar restrictions on telehealth services by state licensing boards. That said, the Teladoc litigation is far from over, and the district court’s decision could be reversed on appeal.

© 2020 Covington & Burling LLPNational Law Review, Volume V, Number 159
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About this Author

Philip Peisch, Covington, Healthcare attorney
Special Counsel

Phil Peisch helps clients navigate complex issues and disputes arising out of government-sponsored health care programs. Mr. Peisch has particular expertise regarding Medicaid, the Children Health Insurance Program (CHIP), and the Affordable Care Act’s regulation of private insurance (ACA). He also counsels clients with respect to Medicare reimbursement; certification of and reimbursement issues relating to Electronic Health Records; state regulation of private health insurance; and other state and federal rules and policies governing the health care industry.

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