Telemedicine Providers May Have to Wait on Antitrust Immunity Decision


One of the key legal questions casting a shadow over increased availability of telemedicine might not get decided any time soon if a federal appeals court finds that it doesn’t have jurisdiction to hear an appeal of claims against the Texas Medical Board.

The board appealed after a federal district court judge in Texas ruled that the board wasn’t sufficiently supervised by state authorities such that it could claim immunity from the federal antitrust laws. Teladoc Inc. had claimed that the board—which is largely made up of practicing physicians in Texas—used its rules to prevent competition from telemedicine providers like Teladoc.

The board claimed that it was effectively operating as an instrument of the state government when it imposed the in-person examination rules that seem to preclude telemedicine as a viable offering. As a result, the board said, it couldn’t be subject to the federal antitrust laws, a concept known as “state action immunity.”

The board’s appeal has been proceeding in the U.S. Court of Appeals for the Fifth Circuit and 15 different groups have weighed in on whether the board could claim state action immunity, with the vast majority saying that it couldn’t. Among those, the Federal Trade Commission and the Department of Justice, the two federal agencies charged with enforcing the antitrust laws, said the board wasn’t sufficiently supervised by the state government and was thus not immune.

However, the American Antitrust Institute filed a friend of the court brief not supporting either side, but pointing out that the appeals court might not have jurisdiction to hear the case in the first place. According to the AAI brief, an order denying state action immunity isn’t immediately appealable.

Most of the other friend of the court briefs supporting Teladoc have taken up this thread and asked the Fifth Circuit to dismiss the appeal for lack of jurisdiction. The court hasn’t yet ruled on the matter and has given the board until Oct. 17 to file a reply brief in the case.

But, if the court does dismiss for lack of jurisdiction, we may have to wait until after a trial in the district court and then a subsequent appeal of that decision possibly through the federal appeals courts and possibly to the U.S. Supreme Court to find out if a medical board can claim state action immunity from the antitrust laws. And that process could take years.

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