Telehealth · Colorado

Colorado telehealth MSO-PC: licensing, payment parity, and who owns the practice

Colorado needs a Colorado or compact license for patients in the state, makes state-regulated plans pay telehealth on the same basis as in person, and keeps the clinical entity in physician hands. See where the PC fits.

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Direct answer

A Colorado telehealth company needs physicians licensed in Colorado, directly or through the Interstate Medical Licensure Compact, because Colorado Medical Board Policy 40-27 treats care as delivered where the patient sits. C.R.S. § 10-16-123 requires state-regulated carriers to reimburse covered telehealth on the same basis as in-person care, with no in-person or prior-relationship requirement and no restriction on audio-only. The clinical side sits in a professional service entity owned by Colorado-licensed physicians under C.R.S. § 12-240-138, and the founder owns an MSO paid a fixed fair-market-value fee. Foundry forms that MSO-PC for $15,000 one-time and matches a Colorado-licensed friendly PC owner for $3,000/mo.

The ownership statute and the hospital exception are covered on Colorado CPOM. The CPOM 50-state guide compares Colorado with the other states you serve, and the telehealth MSO-PC hub covers the multi-state build. General information only, not legal advice. Foundry is not a law firm.

Licensing: who may treat Colorado patients online

Path	Who it fits	Limits
Colorado license	Any physician treating patients located in Colorado	Issued by the Colorado Medical Board
Interstate Medical Licensure Compact	Physicians with a clean license in another compact state	Colorado joined in 2016; the result is still a full Colorado license
Consult only	A physician advising another clinician who keeps the patient	Policy 40-27 does not apply when the treating clinician stays in charge

Under Policy 40-27, telehealth is held to the same standard of care as an in-person visit. A physician may establish the relationship by telehealth, as the Board's Policy 40-03 allows, but must complete and document an appropriate evaluation before prescribing. A static questionnaire with no evaluation is not enough.

Payment parity and coverage rules

Rule	What it says	What it means for the PC
C.R.S. § 10-16-123(2)(b)(I)	Carriers reimburse covered telehealth services on the same basis as in-person services	Bill telehealth under the PC's contracts at the contracted rate
C.R.S. § 10-16-123	No in-person contact required, and no prior relationship required to cover a telehealth visit	A first visit by video can be covered
C.R.S. § 10-16-123	No extra certification, location, or training conditions, and no limits on HIPAA-compliant technology, including audio-only	Audio-only follow-ups can be billed when clinically appropriate
C.R.S. § 25.5-5-320	Colorado Medicaid pays telemedicine at no less than the in-person rate	Enroll the PC, not the MSO, with Health First Colorado

Parity covers state-regulated plans. Self-funded employer plans fall under federal law, so check each contract. Claims belong to the physician-owned PC under its own tax ID and group NPI, and patient payments land in the PC's bank account.

Controlled substances and the PDMP

C.R.S. § 12-280-404(4) requires a prescriber to query the Colorado PDMP before prescribing an opioid, with exceptions for facility patients, cancer pain, hospice, post-surgical supplies, disasters, and single doses. Subsection (4)(a.5) adds a query before prescribing a benzodiazepine, with its own exceptions. Repeated failure to check is grounds for discipline. The DEA telemedicine flexibilities under 21 CFR 1307.41 run through December 31, 2026, and each prescriber needs a DEA registration for the state where the patient sits.

Who owns the Colorado practice

Role	Where it sits	Colorado note
Physician owner	Owns the Colorado professional service corporation or PLLC	Colorado-licensed MD or DO under C.R.S. § 12-240-138
Treating clinicians	Employed or contracted by the PC	Colorado or compact license
Founder and investors	Own the MSO	Brand, software, marketing, billing support
MSO fee	Written management services agreement	Fixed or cost-plus at fair market value, never a share of clinical revenue

The hospital employment exception in C.R.S. § 25-3-103.7 is for qualifying hospitals and does not let a lay-owned telehealth company employ physicians. Run the MSA red-flag audit on CPOM compliance before you sign. If you are new to the model, start with how the MSO and the PC fit together.

Setup steps for a Colorado telehealth company

List each visit type, the payers you plan to bill, and any controlled substances.
License each physician in Colorado directly or through the compact, and confirm NP and PA licenses for Colorado patients.
Match a Colorado-licensed physician to own the PC through friendly PC owner matching ($3,000/mo).
Form the Colorado PC and the MSO, and sign a fair-market-value MSA. See MSO-PC formation ($15,000).
Write the evaluation-before-prescribing standard and the PDMP check into your clinical protocols.
Credential the PC with payers and Health First Colorado, and route all clinical payments to the PC's bank account.

Pricing

MSO-PC formation

$15,000

One-time. The MSO and the Colorado physician-owned PC, scoped to your visit model.

Friendly PC owner

$3,000/mo

A Colorado-licensed physician who owns your PC.

Colorado telehealth MSO-PC FAQ

Do I need a Colorado license to treat Colorado patients by telehealth?

Yes. Colorado Medical Board Policy 40-27 treats the practice as happening where the patient is located, so a physician treating a patient in Colorado needs a Colorado license, issued directly or through the Interstate Medical Licensure Compact. The policy does not reach a consult with another clinician who keeps the patient relationship.

Does Colorado require telehealth payment parity?

For state-regulated health plans, yes. C.R.S. § 10-16-123 requires carriers to reimburse covered telehealth services on the same basis as in-person services, and it bars carriers from requiring in-person contact or a prior relationship before covering a telehealth visit. Colorado Medicaid pays at least the in-person rate under C.R.S. § 25.5-5-320.

Can a Colorado telehealth visit be audio-only?

Colorado bars state-regulated carriers from restricting the HIPAA-compliant technology used for a covered telehealth service, and that includes audio-only, under C.R.S. § 10-16-123. The visit still has to meet the in-person standard of care, including a documented evaluation before prescribing.

Do Colorado prescribers have to check the PDMP before a telehealth prescription?

Yes for opioids and benzodiazepines, with listed exceptions. C.R.S. § 12-280-404(4) requires a PDMP query before prescribing an opioid, and subsection (4)(a.5) adds benzodiazepines. Exceptions include facility patients, cancer pain, hospice, and short post-surgical supplies.

Can a lay founder own a Colorado telehealth practice?

Not the clinical entity. C.R.S. § 12-240-138 lets physicians form professional service entities for the practice of medicine and limits who may hold the shares. The hospital employment exception in C.R.S. § 25-3-103.7 does not cover a lay-owned telehealth company. The founder owns the MSO and bills the physician-owned PC a fair-market-value fee.

How much does Foundry charge for a Colorado telehealth MSO-PC?

MSO-PC formation is $15,000 one-time. A Colorado-licensed friendly PC owner is $3,000/mo.

Ready to treat Colorado patients online?

Book a free 20-minute call with your visit model and states. We will scope the PC, the MSO, and the physician owner.