ATA Nexus 2025 Recap: The Business of Telehealth – Key Legal Considerations

May 12, 2025

Editor’s Note: Access a copy of the Foley slides and supplemental materials from the ATA Nexus Business of Telehealth Program at this link.

At ATA Nexus 2025, the American Telemedicine Association (ATA)’s annual meeting, legal experts and health care leaders convened to discuss the evolving regulatory framework shaping telehealth today. A major draw of the event was the ATA’s three-hour deep dive program, “The Business of Telehealth: The Biggest Legal Issues You Need to Understand,” hosted by Nathaniel Lacktman, partner and chair of Foley’s Telemedicine & Digital Health Industry Team and the newly-elected Chairman of the ATA Board of Directors.

Featuring insights from 20 distinguished legal professionals across 12 hot topics in digital health, the session provided a comprehensive overview of the most pressing legal challenges facing telehealth companies today. The discussions illuminated key compliance concerns while reinforcing the exciting opportunities telehealth organizations can seize to drive innovation and growth.

Key Themes and Insights

1. Data Privacy and Digital Strategy Compliance

“Regarding HIPAA privacy enforcement, the current administration has prioritized two areas: cybersecurity and patients’ rights to access their medical records, with dozens of settlements thus far.” – Jennifer Hennessy

As digital health continues to evolve, privacy and security regulations remain at the forefront of compliance efforts. Jennifer Hennessy and Jessica Heimler explored the latest enforcement priorities, including heightened scrutiny of ad tracking technologies, the importance of timely patient access to medical records, and the impact of U.S. Department of Health and Human Services (HHS) and Federal Trade Commission (FTC) settlements addressing privacy violations. With both state and federal government initiatives focusing on security risk assessments, direct-to-consumer telehealth companies benefit from a proactive approach to data governance and compliance with both HIPAA and state consumer data privacy laws. Strategic implementation of these policies will not only mitigate risk but enhance trust between telehealth companies and the patients they serve.

2. DEA Telemedicine Prescribing and Regulatory Developments

“Because the buprenorphine telemedicine final rule is intended to be used in conjunction with the proposed Drug Enforcement Administration special registration rule, it will be a challenge for both rules if the special registration rule is not final and implemented by the end of 2025.” – Nathan Beaver

The regulatory landscape governing telemedicine prescribing of controlled substances continues to evolve, and Nathan A. Beaver and Marika Miller provided clarity on the most recent Drug Enforcement Administration (DEA) final and proposed rules. Miller started off the discussion with a recap of the Ryan Haight Act and noted that, “although practitioners generally cannot prescribe controlled substances without a prior in-person exam, there is an exception for those engaged in the practice of telemedicine.” Both the recent final and proposed DEA rules fall under one of the seven circumstances outlined under the practice of telemedicine exception. Beaver discussed the DEA’s Special Registration proposed rule, an initiative that could significantly influence cross-state prescribing models for controlled substances. The speakers also reviewed buprenorphine telemedicine rule prescribing requirements, highlighting how changes may impact health care providers treating substance use disorders. As policymakers refine these regulations, telemedicine providers must remain engaged in advocacy efforts to shape policies that support patient access while ensuring regulatory compliance.

3. Licensing and Practice Standards Across 50 States

“When assessing multistate telehealth practice standards – whether modality or supervision or prescribing – the first question to ask is: what is the clinician type delivering the care?” – Jacqueline Acosta

With telehealth operating across state lines, navigating licensure and practice standards presents both challenges and opportunities. Jacqueline Acosta and Olivia Dresevic analyzed state-specific regulations, including licensure exceptions, identity verification standards, and prescribing requirements. Their presentation featured heat maps illustrating regional trends, providing attendees with a broad perspective on the national regulatory landscape. As states continue to refine their telehealth policies, organizations must remain agile, adapting to evolving requirements while leveraging asynchronous care modalities to expand access. Sharing a practice tip, Dresevic stated, “The majority of states require the telemedicine provider to obtain the patient’s informed consent to telehealth services prior to delivering care, and that can be accomplished with a single consent form drafted to comply with all 50 states’ laws.”

The session complemented Foley’s 50-state survey of telehealth insurance laws as a public resource.

4. State Laws Governing Telehealth for Reproductive Health Services

The intersection of telehealth and reproductive health care remains a changing legal landscape, impacted by state-specific legislation and FTC rules. Randi Seigel and Natalie Birnbaum examined the regulatory complexities surrounding medication abortion via telehealth, detailing how clinicians navigate criminal laws, workflow limitations, and rapidly-shifting judicial rulings. The session also explored the implications of shield laws and privacy protections, illustrating how forthcoming policy changes will shape telemedicine’s role in reproductive health.

5. Mergers & Acquisitions of Telehealth Companies

“There is an ongoing trend of state Attorney Generals seeking more detailed information on who and what entities are acquiring and investing in health care provider companies.” – Evan Hellman

Over the last five years, the telemedicine industry has experienced significant investment activity, with mergers, acquisitions, and venture financing shaping its trajectory. Rising interest rates and market uncertainty have caused a slowdown in venture financing, but there are still telehealth M&A transactions among the surviving companies. Hannah Zaitlin and Evan Hellman, both of whom are handling telehealth deals, provided a deep dive into health care transaction oversight, focusing on state-specific corporate practice of medicine laws and their implications for deal structuring. “These laws are very definition-heavy”, explained Zaitlin, “and tend not to have materiality thresholds other than the revenue of the parties or expected growth the transaction will yield.” With regulators increasing scrutiny on private equity involvement in health care, telehealth companies should adopt compliance-first strategies when engaging in acquisitions or financing negotiations. A well-informed approach to the specific due diligence expertise required for this unique industry facilitates successful business expansions while ensuring adherence to evolving legal standards.

6. Optimizing Legal Counsel Engagement in Telehealth

Effective collaboration between legal teams and business executives is essential in navigating the complexities of telehealth regulations. Giulia Block and Emily Wein shared valuable insider insights into maximizing legal counsel’s strategic role in facilitating compliance while enabling business innovation. The discussion underscored the importance of practical legal guidance, particularly for organizations operating across multiple jurisdictions with varied regulatory frameworks. By fostering proactive engagement with legal advisors, whether it be in-house counsel or outside counsel, telehealth companies can streamline operations and mitigate risk while driving sustainable growth.

7. Employment Contracts and Non-Compete Agreements in Telehealth Staffing

“Traditional template noncompete clauses, with their local radius and geographic limitations, are not well-suited for use by multistate telehealth companies who often have a clinical workforce who live in multiple states.”
– Larry Perlman

With telehealth businesses relying on multistate distributed staffing models for a widespread clinician workforce, structuring employment agreements requires careful consideration. David Sanders and Larry Perlman explored the nuances of non-compete clauses for clinicians, addressing state-by-state variations in enforceability. The session also discussed alternative protections to bake into contracts, such as confidentiality and non-solicitation agreements, that offer multistate flexibility while safeguarding business interests. As workforce mobility increases, telehealth companies that remain mindful of jurisdiction-specific employment regulations will ensure fair and compliant staffing practices. “One approach to drafting restrictive covenants in multistate telehealth contracts”, offered Sanders “is to differentiate between the physician’s clinical services [for the affiliated PC] and managerial duties [to the management company].”

8. Navigating AI Regulatory Compliance in Health Care: Ethics, Approvals, and Legal Challenges

“The Artificial Intelligence challenge is just the old privacy problem in new clothes: a void of federal privacy law and a patchwork of conflicting state regulations holding back real progress.” – Aaron Maguregui

This presentation, featuring Aaron Maguregui alongside a panel of experts, dove deep into the regulatory and compliance challenges surrounding AI in health care, with a focus on U.S. Food and Drug Administration (FDA) approvals for AI-driven diagnostics and therapeutics and navigating data privacy laws like HIPAA and the General Data Protection Regulation. The panelists discussed the legal pathways for AI-based medical devices, addressing the challenges of securing FDA approval for innovative AI solutions in diagnostics, therapeutics, and patient care. Of note, the panelists explored how to balance AI innovation with the need for compliance to stringent data privacy regulations, ensuring that health care providers can safely leverage AI technologies while protecting patient rights and maintaining trust.

9. Episodic Exemptions and Cross-State Telemedicine Consults

“For all the clinical benefits virtual second opinion programs offer, some doctors may be unknowingly exposing themselves to licensure risk under the mistaken belief these second opinions are only ‘educational’ and not the practice of medicine.” – Nathaniel Lacktman

Licensure exemptions for episodic peer-to-peer consults enable physicians to provide cross-border second opinions without full licensure requirements. Les Trachtman analyzed how hospitals and specialty care providers utilize these exemptions, outlining best practices for ensuring compliance with varying state regulations. The conversation emphasized the importance of understanding legal pitfalls of virtual second opinions, ensuring that consultative services align with legal guidelines while supporting patient-centered care. With the continued expansion of virtual health care models, clarity on licensure exemptions remains essential to protect the integrity of your physician workforce.

10. The Legal and Regulatory Outlook for Digital Therapeutics

“There are three key questions all digital therapeutics companies must answer: 1) How do I bring the DTx product to market? 2) How do I promote and distribute my DTx product? And 3) How do I secure payment and reimbursement for my DTx product?” – T.J. Ferrante

As Digital Therapeutics (DTx) gain traction in health care, regulatory frameworks must evolve to accommodate new treatment modalities. TJ Ferrante led a forward-looking discussion on FDA approvals, reimbursement strategies, and patient engagement challenges affecting DTx adoption. Although digital therapeutics hold immense potential for chronic disease management and mental health care, navigating legal uncertainties and financial feasibility remains crucial. By proactively shaping policies and integrating DTx within telemedicine services, health care innovators can position themselves at the forefront of digital health transformation.

11. Advertising and Compliance in Telehealth Drug Promotions

“Whether or not DTC telehealth companies are subject to FDA jurisdiction when marketing and promoting prescription drugs has been subject to debate for several years, but things are changing and federal legislation has been introduced to close this perceived loophole.” – Caitlin Otis

Telehealth companies engaged in prescription drug marketing must adhere to stringent FDA and FTC advertising regulations, including new FDA laws on social media influencers. Speakers Kyle Faget and Caitlin Otis explored requirements governing online pharmaceutical promotions by telehealth companies, detailing how prescription and over-the-counter drug advertising is regulated across various platforms. Their presentation demonstrated how to structure effective marketing campaigns that ensure adherence to federal laws while maintaining patient trust and regulatory approval.

12. Unlocking AI’s Potential in Health Care and Virtual Care: Governance, Implementation & Real-World Impact

As AI continues to reshape health care, it is crucial to explore how to responsibly govern, implement, and leverage AI technologies for both clinical and virtual care applications. Michaela Weise joined a panel that addressed AI governance frameworks, how to ensure ethical implementation, and building testing AI models for safety and accuracy in real-world settings. She discussed how AI can seamlessly integrate into clinical workflows and virtual care platforms, focusing on clinician adoption, transparency, and overcoming biases in AI-driven health care solutions.

Looking Ahead: Telehealth’s Legal and Regulatory Future

The Business of Telehealth session at ATA Nexus 2025 provided a comprehensive examination of the legal frameworks shaping the future of digital health care. From privacy laws and prescribing regulations to employment agreements and transaction oversight, the discussions underscored the necessity of proactive legal strategies in ensuring telemedicine’s continued growth.

While the regulatory landscape remains complex, the outlook for telehealth is decidedly optimistic. Innovations in licensure models, reimbursement structures, and digital therapeutics adoption present exciting opportunities for businesses to expand services and enhance patient access. As policymakers refine industry regulations, telehealth companies that embrace compliance-first approaches and maintain engagement with legal advisors will be well-positioned for long-term success.

With digital health care at a transformational crossroads, entrepreneurs and industry leaders must remain adaptable, informed, and committed to shaping policies that support the continued advancement of telemedicine.

Want to Learn More?

For more information on telemedicine, telehealth, virtual care, remote patient monitoring, digital health, and other health innovations, including the team, publications, and representative experience, visit Foley’s Telemedicine & Digital Health Industry Team.