Access to Care and Physician-Practice Growth after the Interstate Medical Licensure Compact

Abstract

Because U.S. physicians’ licenses do not transfer between states, their labor mobility is limited, as is patients’ access to care. The Interstate Medical Licensure Compact (IMLC) reduces this barrier in participating states. We estimate whether the IMLC expanded physician labor mobility by measuring the number of physician-practice locations and the number of states in which physicians practice using a staggered difference-in-differences model and data from the Centers for Medicare and Medicaid Services. We find a 3% increase in out-of-state practices for physicians whose primary state participates in the IMLC. Further, the IMLC increased the number of states in which physicians practiced, with more growth in participating states even after accounting for other policy reforms.

Keywords: health economics, occupational licensing, labor mobility

JEL Classification: H75, I18, J44