Interstate Compacts: How States Streamline Professional Licensing and State Law

Interstate compacts are agreements between states that allow them to coordinate laws and policies, most commonly to streamline professional licensing and reduce barriers for licensed workers moving across state lines.

Licensed professionals are increasingly working across state lines, whether through relocation, telehealth, or multi-state employment. Yet licensing systems remain largely state-based, which can create delays and administrative hurdles. Interstate compacts offer a structured way for states to align certain licensing requirements while maintaining independent regulatory authority.

For legal help reviewing interstate licensing requirements or compact participation, speak with an attorney who’s qualified in professional licensing and liability matters.

What Are Interstate Compacts?

An interstate compact is a formal, legally binding agreement between two or more participating states. These agreements are put in place to solve a mutual problem or regional issue. The laws enacted to create the agreement are enforceable by the states, eliminating the need for federal-level involvement. The purpose of these

Occupational licensure compacts enable professionals with a license in good standing in their home state to work in other member states without obtaining additional licenses. This reciprocity agreement essentially functions like a multi-state license. These agreements can apply to in-person employment or work performed through telehealth.

The administration and enforcement of these agreements are typically carried out through a joint commission or an agreed-upon governing body, such as the Council of State Governments’ National Center for Interstate Compacts.

Why State Created Healthcare Interstate Compact Agreements

Healthcare workforce shortages have been an ongoing issue in the United States. This shortage was brought to the forefront of the national conversation during the COVID-19 pandemic. Licensure portability became a viable solution in the public health interest.

Post-pandemic, telehealth services have become increasingly popular. This created new regulatory challenges, as medical providers could be in a different state from the patient.

States were able to enter compact licensing agreements to address a mutual need for qualified healthcare providers. These agreements also made it easier to regulate providers operating telehealth services. With agreements in place, states have also been able to access shared data systems for more accurate reporting and health monitoring.

Constitutional Basis for Interstate Compacts

States are given the power to create interstate compact agreements by the U.S. Constitution. However, there are also limits placed on this ability.

The U.S. Supreme Court explained that states don’t need to seek Congressional approval if the interstate compact agreement doesn’t increase state power or encroach on federal authority. Professional licensing agreements generally do not require Congressional approval.

How Interstate Compacts Work

The implementation of an interstate compact begins with drafting standardized legislation. This is typically done by a state coalition or influential organization, such as the CSG. Once the model legislation is in place, all participating states must enact it into their own state law. Participation is voluntary, and no state is automatically included.

There is typically a minimum number of states that must enact the legislation for the interstate compact to go into effect. Once enough states enact that legislation, a governing commission is established to administer the compact.

The governing commission is responsible for setting uniform rules, maintaining licensure requirements, and coordinating efforts among participating states. member states to recognize qualifying licenses issued by other participants, making it easier for qualified professionals to work across state lines.

How Interstate Compacts Differ From Federal Law

Federal law is designed to operate and apply uniformly across all states. Federal agencies are responsible for oversight and enforcement. It creates one set of rules that applies nationwide.

Interstate compacts function as cooperative agreements between states. They require approval from state legislatures and apply only within compact member states. These agreements do not override federal law or create nationwide rules. Instead, they establish shared standards among participating states while allowing each state to retain authority over licensing and enforcement within its jurisdiction.

Examples of Professional Licensing Compacts

The most common example of interstate compact licensing in use is for health care professionals. Occupational licensing is a standard requirement in the healthcare field, making it more common for states to have interstate compact licensing agreements. It’s common for states to have agreements in place for these professions.

• Doctor
• Nurse
• Psychology
• Physical therapy
• Audiology
• Mental health counseling

Practical Impact of Interstate Compacts for Professionals

For professionals who work in industries that use interstate compacts, there is greater professional freedom. They can seek employment without having to address duplicate licensing requirements.

With reduced licensing barriers, professionals can enjoy greater job mobility and faster relocation. They may also be able to seek tele-health and remote opportunities.

Employers can benefit from interstate compacts by having larger applicant pools. Recruiting, hiring, and training can also happen faster. This reduces hiring costs.

How To Check If Your License Is Covered by a Compact

While the specifics of checking your license may vary, there are some general guidelines that you can follow. The first step is to identify the state licensing board website for your profession or industry in the state where you hold your license.

Another option is to visit the official compact commission website for the profession you work in, such as:

• Nurse Licensure Compact (NLC) Commission
• Interstate Medical Licensure Compact (IMLC) Commission
• Psychology Interjurisdictional Compact (PSYPACT)
• Counseling Compact Commission
• Physical Therapy Compact Commission
• Occupational Therapy Compact Commission
• EMS Compact Commission
• Audiology & Speech-Language Pathology Compact (ASLP-IC)
• Dietitian Licensure Compact Commission

These sites will have the most up-to-date and accurate information. You will find lists of member states, eligibility requirements, the application process, license verification tools, and practice rules.

Seek Legal Advice

As interstate compacts expand across healthcare, counseling, and other licensed professions, they are changing how professionals move, work, and build careers across state lines. They can also increase the complexity of state-by-state regulation. An attorney can help clarify how these rules apply in a specific situation and prevent costly licensing missteps.

To find legal guidance on professional licensing or interstate practice issues, use the Super Lawyers directory to find a lawyer who’s knowledgeable about state licensing and professional standards.