In this solo episode of the Mental Health Evolution, Rachel explores one of the most promising—and complicated—policy shifts in mental health care today: interstate licensure compacts.
As telehealth becomes a permanent part of service delivery, clinicians are increasingly navigating challenges related to cross-state licensure, insurance reimbursement, and legal compliance. Rachel breaks down the current status of licensure compacts for counselors, social workers, and psychologists, and discusses what these changes could mean for access to care, clinician mobility, and the broader mental health landscape.
(0:36–1:04) Why interstate licensure compacts matter now more than ever
(1:04–1:54) The mismatch between where clinicians are licensed and where clients need care
(2:11–2:36) What an interstate licensure compact is and how it works
(2:44–3:20) The Counseling Compact: current implementation and participating states
(3:20–3:35) The Social Work Licensure Compact and where it stands
(3:35–3:57) PSYPACT and why psychologists are ahead of the curve
(4:00–4:18) How compacts could reduce administrative burden and expand access to care
(4:22–5:55) Insurance reimbursement challenges, parity laws, and telehealth payment uncertainty
(6:09–7:19) Potential impacts on rural access and workforce distribution
(7:22–7:55) Scope-of-practice laws, consent requirements, and privacy considerations
(8:05–9:00) How licensure compacts may reshape competition and national mental health markets
(9:06–10:27) Why compacts are promising—but not a complete solution
Interstate licensure compacts allow clinicians to practice across participating states without holding multiple licenses, but implementation varies by profession and state.
The Counseling Compact is live in a limited number of states, PSYPACT is already operational for psychologists, and the Social Work Compact is still in development.
Licensure compacts do not guarantee insurance reimbursement, which remains one of the biggest barriers to cross-state telehealth care.
Telehealth parity laws and Medicaid reimbursement policies differ widely by state and payer.
While compacts could significantly expand access to care, clinicians must still navigate legal, ethical, and financial complexities.
Counseling Compact: http://counselingcompact.gov
PSYPACT: https://psypact.gov/
Social Work Compact: https://swcompact.org/
HHS Telehealth Licensure Overview:
https://telehealth.hhs.gov/licensure/licensing-across-state-lines
Telehealth & Private Insurance Laws:
https://www.ncsl.org/health/the-telehealth-explainer-series/telehealth-private-insurance-laws
Medicaid Telehealth Reimbursement Guidelines:
https://www.medicaid.gov/medicaid/benefits/telehealth/reimbursement-for-telehealth-and-provider-and-facility-guidelines
Federal & State Telehealth Policy Tracker (Manatt):
https://www.manatt.com/insights/white-papers/2025/manatt-telehealth-policy-tracker-tracking-ongoing-federal-and-state-telehealth-policy-changes
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Music Credit: Music by Zach Harrison
