As they dealt with the COVID-19 emergency and subsequent economic recovery, states across the U.S. increasingly turned to universal license recognition and other licensing reforms as ways to encourage mobility between their states. Advocates of universal license recognition say that it can alleviate labor shortages across sectors by helping skilled workers move between states and start practicing faster. But opponents argue that, if done incorrectly, universal licensing laws can water down licensing requirements that exist to protect the public.
In this article, we’ll explore how universal license recognition works, the debate surrounding it, and what licensing boards in early adopter states think about how it’s impacted licensing in their jurisdictions.
How does universal license recognition work?
Universal licensure differs from (and doesn’t typically conflict with) interstate compacts and reciprocity agreements. With universal licensure, a state recognizes someone’s out-of-state occupational license as valid in that state, but not automatically; they still must apply for a license in the new state with the applicable licensing board before they can start practicing. Like other applicants in that state, they’ll have to pass a background check (if necessary), meet specified requirements (related to exams, residency, number of years they’ve held their existing license(s), etc.), and pay the licensing fees. Most often, these applicants will have to meet additional qualifications such as being in good standing in the other state(s) they are licensed in, having no current disciplinary proceedings or complaints against them, and not having a criminal record that would disqualify them from the license they are applying for.
So, if an applicant still has to apply for a new license and meet specified requirements, how does universal license recognition help them? While they can’t circumvent the licensing process, applicants in states with universal licensing laws can expedite the process if they’re already licensed in another state, often skipping time-consuming training requirements that would normally delay their licensure. This not only saves time, but also prevents lost income due to licensing delays for the applicant. Advocates say that universal licensing can also potentially boost state economies where it’s implemented by allowing skilled workers to fill job vacancies faster, thereby alleviating labor shortages.
Where have universal licensing laws been implemented?
Arizona became the first state in the U.S. to implement universal license recognition in 2019. Since then, over a dozen other states have enacted similar laws, including: Colorado, Florida, Idaho, Oklahoma, Missouri, Montana, New Jersey, Pennsylvania, South Dakota, Utah, and Wyoming. A number of other states are currently debating universal licensing laws or have considered bills in recent years but failed to pass them.
Like licensing requirements, universal licensing laws vary substantially across states. Some (like Florida’s), only apply to (or exempt) certain occupations while others apply to all licensed occupations in that state. Some states (such as Oklahoma) require that applicants live in the state, but others (such as Colorado) don’t impose a residency requirement. Many states require either that the applicant’s existing license has a similar “scope of practice” to the license they are applying for, or that the licensing requirements between the applicant’s new and former states must be “substantially equivalent.” Certain states (such as Kansas and Utah) also leave room for the licensing board to deny a license if they believe that the applicant isn’t qualified or that granting them a license would jeopardize the health and safety of the public.
Criticisms of universal licensing
Critics of universal license recognition point out that it could undermine trust and confidence in licensed professions and even pose a risk to public safety if it’s not implemented correctly. The public needs to be assured that every licensed professional in their state has met consistent rigorous standards to get their license, but as these standards vary from state to state, this assurance can’t be guaranteed in states that haven’t adopted a “substantially equivalent” provision in their universal licensing legislation. For this reason, Marta Zaniewski, executive director of the Alliance for Responsible Professional Licensing (ARPL), cautions against a one-size-fits-all approach to universal licensing, and ARPL recommends that substantially equivalent requirements addressing education, examinations, and experience (the “three Es”) are incorporated into licensing reform involving interstate practice.
Opponents to universal licensing reform bills in several states have echoed Zaniewski’s concerns. In West Virginia, Democrats opposed to HB 2007 – which would create a new “Universal Recognition of Occupational Licenses Act” in the state – criticized the one-size-fits-all approach of the bill, which applied to a number of professions with licensing requirements that varied greatly in terms of education and experience, such as engineers, massage therapists, veterinarians, accountants, dentists, and architects. Licensing boards also expressed concerns, saying that the changes called for in the bill risked lowering the high standards adhered to by West Virginia-based professionals for out-of-state applicants.
What do licensing boards think of universal recognition laws so far?
Although many states’ universal licensing laws are quite new, the Council of State Governments (CSG) surveyed administrators from licensing bodies in seven early adopter states (with laws enacted for at least one year) to gather feedback on how effective the policies have been so far and how they have changed the licensing processes in their jurisdictions. Researchers received 31 responses from administrators in Arizona, Colorado, Idaho, Iowa, Missouri, Montana, and Pennsylvania (with 16 of the responses coming from state boards in Pennsylvania). Survey results were published in a report released in December 2021.
Among those who held a positive view of their state’s universal licensing policies, administrators reported that it has made the licensing process more efficient, decreased average licensing times, and reduced unnecessary barriers for new residents, veterans, military spouses, and other individuals. However, many respondents believed there wasn’t actually a need for universal licensing policies because the same mechanisms were already in place from existing reciprocity agreements and licensure by endorsement policies. In addition, some respondents noted that residency requirements in their states discouraged many applicants from utilizing the process.
When asked about challenges they faced during the implementation of universal licensing in their states, several respondents expressed concerns with determining competency standards and “substantial equivalence.” In states that hadn’t already completed this work for other laws, respondents noted that it could be difficult to get the information they needed to determine “substantially similar” requirements because definitions of occupations can differ from state to state. Differences in scopes of practice and job titles could also create disruptions in the process.
Another important concern was the potential for universal licensing laws to force boards to license applicants who were less qualified than their standards would usually allow. Respondents in multiple states noted practitioners with lower requirements were being actively licensed through the universal licensing policy. In one state without a “substantially equivalent” provision, several administrators said that the policy allowed for the licensing of out-of-state applicants with noticeably fewer requirements than those in-state.
The future of universal license recognition
Universal license recognition – along with reciprocity agreements and interstate compacts – will likely remain an attractive option for states trying to streamline license portability across state borders and reduce barriers to licensing. Compared to those two other options, which are much narrower in scope and target certain occupations and/or regions, the broad nature of universal licensing means that it can potentially have a bigger economic impact and help a greater number of practitioners who wish to work in a new state. However, as we’ve seen, taking a “one-size-fits-all” approach raises concerns that public trust could be damaged by creating inconsistency in the qualifications of practitioners, and that the health and safety of citizens could be endangered by lowering requirements to practice in highly technical fields.
Including a “substantially equivalent” provision is an important way that lawmakers can prevent the dilution or elimination of standards that exist to protect the public. But regulators’ experiences with implementing universal licensing laws so far demonstrate the complexity involved in determining what “substantially equivalent” means. Although it can be relatively straightforward for professions with licensing requirements that are largely standardized across states, it becomes a much more difficult endeavor for occupations with requirements that vary widely.
To address challenges with the implementation of universal licensing laws and their use by licensees, CSG recommends including clearer language to define “substantial equivalence,” implementing digital licensing systems to meet the need for new or improved online application and licensing processes, and adding provisions to explicitly exclude interstate compacts.
