Best Practices for Multi-State License Verification

Best Practices for Multi-State License Verification

Jul 8, 2022
  • Author:
    Noelle Abarelli

Change is constant in the healthcare industry, especially when it comes to license verification. In the past, providers would complete their training and move to a location where they would likely live out the rest of their careers. That is no longer the case. Nowadays, most providers work under employment contracts that renew annually, allowing them the flexibility to change locations if desired. This could lead to a provider having multiple licenses in multiple states. Add to that locum tenens and telemedicine providers who could be licensed in every state, and it's clear to see much has changed over the last few decades. More multi-state license verification means there's a lot more to keep track of these days!

Although it's still standard practice to query the licensure board for the state in which the provider will be providing services, there is variation in querying each individual state licensure board for all licenses. In the past, most facilities used to verify all past and current licensure directly with the state licensure board. But the advent of state licensure board reporting of disciplinary actions to the Federation of State Medical Boards (FSMB) and the National Practitioner Data Bank (NPDB) has changed that. Now, many hospitals utilize these databases in lieu of querying each individual state licensure board.

If you're looking for best practices when it comes to multi-state license verification, we can help!

Key License Definitions

In order to understand best practices, it's important to understand some key definitions involved with multi-state license verification.

Primary Source

A primary source is the original source of a specific credential that can verify the accuracy of a credential reported by an individual health care professional, which means verification is received directly from the issuing source. An example of Primary Source Verification would be when an organization receives information on medical school graduation directly from the medical school, not a copy of the medical school diploma from a provider.

Designated Equivalent or Secondary Sources

A primary source may designate another organization as its agent in providing information to verify credentials. This other organization is then considered a designated equivalent or approved secondary source, meaning information received from that organization can be used in lieu of obtaining information directly from the primary source. All healthcare accrediting organizations have specific requirements regarding the use of designated equivalent or secondary sources.

Federation of State Medical Boards

The Federation of State Medical Boards (FSMB) represents the state medical and osteopathic regulatory boards within the United States, its territories, and the District of Columbia. Hospitals and other health care organizations can search licensure history and past regulatory actions for actively licensed physicians and physician assistants. FSMB query meets the primary source licensure verification and sanction history requirements of the National Committee for Quality Assurance (NCQA) and primary source equivalent requirements for state board and federal sanctions by The Joint Commission and URAC. FSMB profiles contain information regarding:

  • Revocations and suspensions
  • Loss of license
  • Probation restrictions of disciplinary and non-disciplinary actions
  • Licensure denials
  • Reinstatements
  • Consent orders
  • Administrative actions (fines, warnings, etc.)
  • Medicare/Medicaid exclusions or reinstatements

National Practitioner Data Bank

The National Practitioner Data Bank (NPDB) was created by congress to prevent incompetent physicians moving from state to state without disclosing their previous issues to the new entities from which they were requesting privileges. It collects and releases (to authorized parties) physician information about:

  • Medical malpractice payment information
  • Licensure actions by boards of medical examiners
  • Licensing and certification actions taken by states
  • Federal licensing and certification actions
  • Adverse actions taken by health care entities against clinical privileges, including professional review actions taken by professional societies
  • Negative actions or findings by peer review organizations or private accreditation entities
  • Healthcare-related criminal convictions
  • Healthcare-related civil judgments
  • Exclusions from participating in federal or state healthcare programs
  • Other healthcare-related adjudicated actions or decisions

Best Practices

With key definitions in mind, we can now outline multi-state license verification best practices.

License Verification Requirements

Determine what requirements your organization has with regard to license verification. Some organizations will only accept verifications from the primary source, whereas others will consider querying the FSMB or the NPDB enough.

For example, the Accreditation Commission for Healthcare (ACHC) requires that for applicants and reapplicants, all previous licenses should be verified directly with the primary source licensure board. In addition, information regarding licensure sanctions must be sought for all current licenses, states of current practice (or intended practice), and all previous licenses held. This information can be obtained from the FSMB or Fraud and Abuse Control Information Systems (FACIS).

Verify Licenses

Verify the provider with the licensure board for the state in which the provider will be providing care to the facility’s patients. This is to assure you that the license is valid and is not restricted in any way. Licensure sanctions and disciplinary actions are typically verified with the FSMB or by query to the NPDB.

Meet Regulatory Requirements

Before recommending privileges, query the FSMB for an evaluation of any challenges to licensure or registration for each provider. This is a requirement of The Joint Commission.

FAQs To Consider:

Now, multi-state license verification will vary by state and by the organization, but there are some frequently asked questions that serve as an excellent starting point in guiding your process.

Q: Do I have to verify every license the provider has held with the primary source licensure board?

A: There are no accreditation requirements for verifying every license directly with the licensure board.

Q: What happens if a license verification comes back from one state with disciplinary action, but no action is reflected in the verification received from the state licensure board in which our hospital provides care?

A: When one state licensure board takes action against a provider, there is typically a reciprocal action in other states where the applicant holds a license. It takes time for these disciplinary actions to make their way through the process, so there may be a delay in the action being taken and reported on the licensure board's website. In addition, there is some lag time in reporting from the state licensure boards to the NPDB or FSMB. Contact the license board in your state and find out what you must do to get information regarding whether the licensure board is aware of the disciplinary action in the other state, and whether it is considering action against this license. The provider may have to give consent prior to the licensing board releasing any information. The state regulations of the licensing board may not allow for information to be released. The provider should be asked to disclose and provide copies of any communications received from your state's licensure board.

Q: What kind of information is available from the state when disciplinary action is taken against a provider's license?

A: Information varies by state. In some cases, there may be a copy of the consent order available for download. There may be additional information available via a Freedom of Information Act request. Since regulations of licensure boards vary by state, you will need to contact your state licensure board and ask what information is available.

This depends on the policies and procedures of the facility. Accreditation and regulatory standards do not require copies of licenses, they require verification of the license. Some organizations request copies of licenses, and some do not. When an organization is assisting in provider enrollment, they will often ask for a copy of the current license as these are required by insurance plans during the provider enrollment procedure.

Multi-State License Verification Solution

Multi-state license verification is an important credentialing requirement as defined by regulatory bodies, and both state and federal agencies. Medical Service Professionals have a huge responsibility in keeping all of this information updated and accurate, but the good news is it doesn't have to be difficult. CredentialStream supports credentialing license verification through the Validate module that houses over 3,600 supported third-party, primary source sites. Validate quickly verifies a referring provider or entity so you can ensure referring resources have a clean record before accepting the referral or order.

Why it helps:
  • VerityStream provides best practice content with Validate queries to certify sanctions, exclusions, and current licensure.
  • You gain rapid access to provider profiles that are continuously updated based on primary source verifications from federal verification and exclusion lists, licensing and specialty boards, and integrated partners like the Federation of State Medical Boards (FSMB).
  • Users can utilize "VerifyNow" to complete a verification on demand.

  • If you're looking for support for multi-state license verification, CredentialStream is the answer. Learn more here, and if you'd like to schedule a demo, we're here to help!