Third Circuit Upholds New Jersey's Requirement That Out-of-State Doctors Hold a New Jersey License Before Treating Patients by Telemedicine

One of the most contested questions in telemedicine is whether a doctor licensed in one state may treat a patient located in another without also holding a license in the patient's state. On August 31, 2026, a federal appeals court gave New Jersey a clear answer in that state's favor. In a precedential opinion, the U.S. Court of Appeals for the Third Circuit affirmed the dismissal of a lawsuit that had argued New Jersey's licensing requirement for cross-border telemedicine violates the Constitution.

What the Third Circuit decided

The case is MacDonald v. President of the New Jersey State Board of Medical Examiners, No. 25-2090. The appeal came from the U.S. District Court for the District of New Jersey, where Judge Edward S. Kiel had granted the state's motion to dismiss the complaint for failure to state a claim. A Third Circuit panel heard argument on March 25, 2026, and filed its precedential opinion on August 31, 2026, written by Judge Thomas Hardiman. The court affirmed the dismissal of all claims, with one modification described below.

In plain terms, the court left New Jersey's telemedicine licensing requirement in place. A physician who wants to consult with a patient located in New Jersey by video or other virtual means must first obtain a New Jersey medical license, and the appeals court held that requirement does not violate the plaintiffs' constitutional rights.

The New Jersey law at issue

New Jersey requires anyone who practices medicine in the state to be licensed by its Board of Medical Examiners. By statute, that requirement reaches virtual care as well: a physician who uses telemedicine or engages in telehealth while providing services to a patient must be validly licensed to provide those services in New Jersey (N.J. Stat. Ann. Section 45:1-62(b)).

According to the plaintiffs, a physician already licensed and in good standing in another state with substantially equivalent standards does not have to be reexamined, but must still submit an application, pass a background check, and pay fees. The plaintiffs alleged those fees run about $550 with an average processing time of roughly three months, and that an expedited route under the Interstate Medical Licensure Compact costs about $700 and can be completed in weeks. The court noted that New Jersey had relaxed some of these requirements temporarily during the COVID-19 pandemic. This licensing framework is separate from New Jersey's rules for prescribing controlled substances by telemedicine, which the state revised in 2026.

Who sued and why

The plaintiffs, represented by the Pacific Legal Foundation, were two out-of-state specialists and three New Jersey residents. Dr. Shannon MacDonald is a radiation oncologist at Massachusetts General Hospital who treats rare pediatric cancers and is licensed in Massachusetts. Dr. Paul Gardner is a neurosurgeon at the University of Pittsburgh Medical Center and an expert in skull base surgery, licensed in Pennsylvania. The patient plaintiffs, including a minor identified as J.A. and his father Michael Abell, and Hank Jennings, wanted to hold follow-up consultations with these specialists by telemedicine without traveling out of state.

The plaintiffs brought an as-applied challenge and sought to stop New Jersey from enforcing the licensing rule against them. They argued the requirement violates the First Amendment, the dormant Commerce Clause, and the Privileges and Immunities Clause, and that it violates a parent's substantive due process right to direct a child's medical care.

The First Amendment question: speech, but not strict scrutiny

The court treated the First Amendment claim as the plaintiffs' strongest. It agreed with them on an important threshold point: the licensing rule regulates speech, and it does so based on content, because it conditions a doctor's ability to convey diagnoses and treatment recommendations on holding a New Jersey license. The court rejected New Jersey's argument that the law merely regulates professional conduct and burdens speech only incidentally, citing recent Supreme Court decisions holding that there is no separate category of lightly protected professional speech.

Ordinarily, a content-based speech restriction faces strict scrutiny, the most demanding form of review. But the court held that strict scrutiny does not apply here. Drawing on the Supreme Court's history-and-tradition approach in recent cases, the panel canvassed the long pedigree of medical licensing, tracing it from a 1518 English charter through colonial New York and New Jersey statutes to the near-universal state licensing regimes established by the end of the 1800s. Because content-based medical licensing reflects what the court called a long, if heretofore unrecognized, tradition, the panel concluded that strict scrutiny is inappropriate.

The court said it did not need to decide precisely which lower standard applied, because New Jersey's law survives even under intermediate scrutiny, the more demanding of the remaining options. The state's interest in protecting patients by verifying the competence and character of practitioners is important, the court reasoned, and the burdens the plaintiffs identified, chiefly fees and administrative steps for a streamlined out-of-state application, were too slight to show that the rule burdens substantially more speech than necessary.

The Commerce Clause, Privileges and Immunities, and due process claims

The court rejected the remaining claims as well. On the dormant Commerce Clause, it held the law does not discriminate against out-of-state doctors because it applies equally to any physician, in state or out, who wants to treat a New Jersey patient. Any burden, the court said, falls on multi-state practitioners generally rather than on out-of-state doctors as such, and the plaintiffs had not plausibly alleged that the burden on interstate commerce is clearly excessive in relation to the state's health and safety benefits. The court applied the same reasoning to reject the Privileges and Immunities claim.

The one modification the court made concerned the substantive due process claim brought by Michael Abell on behalf of his son. The panel held Abell lacked standing because the possibility that his son would need another out-of-state telemedicine consultation was not certain or imminent enough to support a live case. The court therefore directed that this claim be dismissed without prejudice for lack of jurisdiction, rather than on the merits.

What this means for cross-state telemedicine

State licensing has been one of the central legal frictions in telemedicine since virtual care expanded during the pandemic. Most states require a physician to be licensed where the patient is located, and challenges to those rules have generally not succeeded. This decision adds a precedential federal appeals court ruling to that record, and it does so on a constitutional theory, the First Amendment, that patient-access advocates had hoped might loosen state licensing barriers.

For patients and clinicians, the practical takeaway is that within the Third Circuit the existing model remains intact: to treat a patient in New Jersey by telemedicine, a doctor generally still needs a New Jersey license, though the Interstate Medical Licensure Compact can speed the process for eligible physicians. The following is general information about a court decision, not legal or medical advice; patients and clinicians with questions about a specific situation should consult a licensed attorney or their state medical board.

Limits and what happens next

Several limits are worth keeping in mind. The ruling is precedential only within the Third Circuit, which covers New Jersey, Pennsylvania, Delaware, and the U.S. Virgin Islands; other circuits are not bound by it. The case was decided at the pleading stage on a motion to dismiss, so the court accepted the complaint's factual allegations as true and did not resolve a full evidentiary record. And the decision is not necessarily the last word: the plaintiffs may ask the full Third Circuit to rehear the case or petition the U.S. Supreme Court for review. As of publication, the opinion stands as the court's final disposition of the appeal.