Telemedicine Restrictions: Texas Medical Board Faces Lawsuit

The Texas Medical Board was sued by the largest telemedicine company, Teladoc based in Dallas, when they framed new rules restricting doctors from treating patients they’ve never met. The company alleges that the restriction violated antitrust laws and would put the company out of business in the state of Texas. This litigation is an attempt to further regulate telemedicine. This technology enables remote diagnosis and treatment of patients by phone or video conferencing.

Teladoc was allowed to treat patients in Texas but since 2011, the board has sought rules to specify that the doctor and a patient must have an established relationship which constitutes at least an initial visit in person. See 22 Tex. Admin. Code § 190.8(1) (L).

The company previously sued the Board on different grounds, mainly alleging the problems in the Board’s Rule-making process. Teladoc, Inc. v. Tex. Med. Bd., 453 S.W.3d 606 (2014). However, in its present suit with the United States District Court in Western District of Texas, Austin Division, the company alleges the board of violating the Sherman Act, 15 U.S.C. § 1 and the Commerce Clause, U.S. Const. Art. I, § 8, Clause 3 that lays protection against unreasonable restraint of trade and commerce.[1]

The Texas Medical Board stated that the main intention behind framing such restraining rules is to prevent patients being misdiagnosed or prescribed dangerous drugs by doctors. The 22 Tex. Admin. Code § 190.8(1) (L) provides protection to patients and accountable to doctors for any misdiagnosis during treatment by prohibiting prescription of any dangerous drug or controlled substance without first establishing a proper professional relationship with the patient[2]. They even exempt mental health visits with doctors and allow telemedicine from number of locations.[3]

Besides serving the needs for a fair treatment, this process is however a disadvantage for the company, as it has most of its customers in Texas than in any other State and losing such customers would slash down their revenues in a drastic manner, thereby creating huge losses to its revenue.

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