Legislative Analysis
Phone: (517) 373-8080
OCCUPATIONAL THERAPY LICENSURE COMPACT
http://www.house.mi.gov/hfa
House Bill 4169 (H-1) as reported from committee Analysis available at
Sponsor: Rep. Julie M. Rogers http://www.legislature.mi.gov
House Bill 4170 (H-1) as reported from committee
Sponsor: Rep. Douglas C. Wozniak
Committee: Health Policy
Complete to 10-31-23
SUMMARY:
House Bills 4169 and 4170 would amend the Public Health Code to enter Michigan into the
Occupational Therapy Licensure Compact (OTLC), which allows occupational therapists and
occupational therapy assistants to practice occupational therapy in states that are parties to the
compact without having to be licensed in each individual state. 1 (A compact is like a contract
between states that states enter into by enacting its provisions as law.) House Bill 4169 would
make Michigan a party to the OTLC, and House Bill 4170 would make some related changes
to the code’s occupational therapy licensure provisions.
House Bill 4169 would add section 16188 to the Public Health Code to enter Michigan into
the OTLC, which is included in full in the bill and described briefly below.
Section 1: Purpose
The OTLC states that its purpose is to facilitate interstate practice of occupational therapy with
a goal of improving access, while preserving the regulatory authority of states to protect health
and safety through their current systems of licensure. Among other things, the OTLC says that
it is designed to facilitate the use of telehealth technology to increase access to occupational
therapy services.
Section 2: Definitions
This section defines 26 terms that pertain to the execution of the duties outlined in the OTLC.
Notably, compact privilege is defined as the authorization (equivalent to a license) granted by
a state to allow a licensee from another member state to practice as an occupational therapist
or occupational therapy assistant in the remote state under its laws and rules. The practice of
occupational therapy is considered to occur in the state where the patient or client is located at
the time of the encounter.
Section 3: State participation in the compact
To participate in the OTLC, a state must do all of the following:
• License occupational therapists and occupational therapy assistants.
• Use only a recognized national examination as a requirement for licensure, as
prescribed in rules of the Occupational Therapy Compact Commission.
• Have continuing education requirements as a condition of license renewal.
1
https://otcompact.org/about/
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 • Within a time frame established by the commission, require a criminal background
check for a licensee who is seeking an initial compact privilege in another state. The
background check must include obtaining criminal history records from the Federal
Bureau of Investigation (FBI) and the relevant state agency through fingerprints or
other biometric data. The member state must also use those criminal history records in
making licensing decisions.
• Have a mechanism in place for receiving and investigating complaints about licensees.
• Notify the commission, as provided in the OTLC and rules, of any adverse action or
the availability of investigative information regarding a licensee. (An adverse action is
any administrative, civil, equitable, or criminal action imposed against an occupational
therapist or occupational therapy assistant by a licensing board or other state authority.
It includes such actions against an individual’s license or compact privilege as censure,
revocation, suspension, probation, monitoring, or practice restrictions.)
• Participate fully in the commission’s data system, including using the commission’s
unique identifier. (The data system is described below.)
• Comply with the rules of the commission.
A member state must grant the compact privilege to an individual who holds a valid
unencumbered license in another member state and may charge a fee for granting it.
The OTLC says that nothing in it affects a state’s requirements for issuance of a single-state
license. Individuals who do not reside in a member state can still apply for a single-state license
under the laws of that state, but this license does not grant the compact privilege in any other
member states.
A member state must provide for its delegate to attend all meetings of the Occupational
Therapy Compact Commission.
Section 4: The compact privilege
To exercise or maintain the compact privilege under the OTLC, a licensee must do all of the
following:
• Hold a valid, unexpired license in their state of residence (referred to as the home state).
• Have a valid Social Security number or national practitioner identification number. 2
• Have no encumbrance (restriction) on any state license.
• Be eligible for a compact privilege in any member state as described below.
• Have paid or completed, at least two years ago, all fines and requirements stemming
from an adverse action against any license or compact privilege.
• Notify the Occupational Therapy Compact Commission that the licensee is seeking the
compact privilege in a remote state.
• Pay any applicable fees, including any state fee, for the compact privilege.
• Complete a criminal background check, as described above, and pay any related fees.
• Meet any jurisprudence requirements established by the remote state where the licensee
is seeking a compact privilege.
• Report to the commission adverse action taken by any non-member state within 30
days after that action.
2
Often called the National Provider Identifier (NPI). See https://www.cms.gov/outreach-and-education/medicare-
learning-network-mln/mlnproducts/downloads/npi-what-you-need-to-know.pdf
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 A licensee providing occupational therapy in a remote state under the compact privilege must
function within that state’s laws and regulations and is subject to its regulatory authority. The
remote state may remove a licensee’s compact privilege for a specific time, impose fines, or
take any other necessary actions to protect health and safety.
If a licensee’s home state license is encumbered, the licensee must lose the compact privilege
in any remote state until two years have passed after the home state license is no longer
encumbered. The licensee then must meet the requirements listed above to obtain the compact
privilege in any remote state.
If a licensee’s compact privilege in any remote state is removed, the licensee may lose (and be
ineligible for) the compact privilege in any other state until two years have passed since the
time period of that removal ended and the fines were all paid and any conditions met. The
licensee then must meet the requirements listed above to obtain the compact privilege in any
remote state.
Section 5: Home state licenses
An individual may hold a home state license in only one member state at a time.
A licensee who moves their primary residence from one member state to another must file an
application for obtaining a new home state license by virtue of a compact privilege, pay all
applicable fees, and notify the old and new home states in accordance with rules adopted by
the commission. Upon receiving an application for obtaining a home state license by virtue of
compact privilege, the new home state must verify that the individual meets the pertinent
criteria of section 4 by using the commission’s data system. There is no need for primary source
verification, except for the following:
• An FBI fingerprint-based criminal background check if not previously performed or
updated under rules adopted by the commission.
• Any other criminal background check as required by the new home state.
• Submission of any jurisprudence requirements of the new home state.
The former home state must convert the former license into a compact privilege once the new
home state activates the new license in accordance with rules adopted by the commission.
If the licensee cannot meet the criteria in section 4, the new home state must instead apply its
requirements for issuing a new single-state license. In addition, if a licensee moves from a
member state to a non-member state, or vice versa, the state criteria apply for issuance of a
single-state license in the new state. The OTLC says that it does not affect a licensee’s ability
to hold a single-state license in multiple states or the requirements established by a member
state for issuance of a single-state license.
Section 6: Active duty military personnel and their spouses
Active duty military personnel, or their spouses, must designate a home state where they have
a current license in good standing and can keep the home state designation while the service
member is on active duty. Once one is designated, the individual can change their home state
only by applying for licensure in the new state or through the process described in section 5.
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 Section 7: Adverse actions
A home state has the exclusive power to take adverse action against an occupational therapy
license issued by it. A home state, following its own procedures, may take adverse action based
on the factual findings of a remote state. For purposes of taking adverse action, a home state
must treat conduct reported by a member state the same as if the conduct had occurred in the
home state.
If a home state takes adverse action against a license, the licensee’s compact privilege in all
other member states is deactivated until all encumbrances have been removed from the home
state license, and the applicable disciplinary orders must include a statement to that effect.
A remote state may take adverse action against a licensee’s compact privilege in that state and
may issue subpoenas for hearings or investigations that compel the testimony of witnesses or
production of evidence. Member states must enforce such subpoenas issued by an occupational
therapy licensing board of another member state. The authority issuing the subpoena must pay
any related fees and expenses.
A member state that takes adverse action must promptly notify the administrator of the data
system, who must promptly notify home states of any adverse actions by remote states.
The home state must complete any pending investigations of a licensee who changes their
primary state of residence while investigations are ongoing, may take appropriate actions, and
must promptly report the conclusions of the investigations to the data system. The data system
administrator must promptly notify the new home state of any adverse actions.
Member states may participate in joint investigations of licensees. Member states must share
any investigative, litigation, or compliance materials in furtherance of any joint or individual
investigation under the OTLC.
Instead of an adverse action, member states may, at their discretion, use participation in a
nondisciplinary monitoring process approved by an occupational therapy licensing board
(referred to as an “alternative program”).
Section 8: Occupational Therapy Compact Commission
The OTLC creates the Occupational Therapy Compact Commission as a joint public agency
consisting of one delegate from each member state who is either a licensee member or public
member of that state’s licensing board or the board’s administrator. Delegates are selected by
each state’s licensing board, with a term of office as established by the commission. A member
state can remove or suspend its delegate and must fill any vacancy within 90 days. Each
delegate has one vote with regard to issuing rules and creating bylaws and otherwise has an
opportunity to participate in the business and affairs of the commission.
The OTLC enumerates several powers and duties of the commission, such as those related to
its bylaws, its code of ethics, rulemaking, recordkeeping, personnel, budgeting, grants or loans,
insurance and bonds, property, litigation, the creation of committees, and the performance of
other functions to achieve the purposes of the OTLC consistent with the state regulation of
occupational therapy licensure and practice.
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 The commission must establish an executive committee to act on its behalf. The committee
consists of nine members: seven voting members elected by the commission from its current
membership and two nonvoting members selected by, respectively, a recognized national
occupational therapy professional association and a recognized national occupational therapy
certification organization. The executive committee must meet at least annually and, in
addition to performing other duties as provided in rules or bylaws, must do all of the following:
• Recommend changes to the rules, bylaws, or the OTLC; fees paid by member states;
and any commission compact fee charged to licensees for the compact privilege.
• Ensure that compact administration services are appropriately provided.
• Prepare and recommend the budget.
• Maintain financial records on behalf of the commission.
• Monitor compliance of member states with the OTLC and provide compliance reports
to the commission.
• Establish additional committees as necessary.
The commission must meet at least annually, and all commission meetings must be open to the
public, with public notice of the meetings provided in member states and on the commission
website. However, the commission, executive committee, or another committee may convene
in closed nonpublic meetings to discuss the noncompliance of a member state, personnel
matters, current or prospective litigation, the negotiation of contracts, or other specified
sensitive topics, such as those related to trade secrets or criminal investigations.
The commission must keep accurate accounts of all receipts and disbursements, which are
subject to an annual audit that must be included in the commission’s annual report. The
commission may levy and collect an annual assessment from each member state or impose fees
on other parties to pay any cost of its operations and activities each year that is not covered by
other revenue sources.
The commission and its employees are individually and collectively immune from liability for
damage or injury arising from an act or omission occurring within the scope of commission
employment or responsibilities, except for intentional, willful, or wanton misconduct. The
commission would have to defend, and indemnify, its employees in any such civil action.
Section 9: Data system
The commission must provide for the development, maintenance, and use of a coordinated data
and reporting system that contains licensure, adverse action, and investigative information on
all individuals licensed in member states. Member states must submit a uniform data set with
the identifying information, licensure data (including reasons for licensure denials), adverse
actions, current significant investigative information, and other relevant information regarding
all individuals licensed in their state. Investigative information is available only to other
member states. Member states can designate information that cannot be made public without
that state’s express permission. The commission must promptly notify all member states of any
adverse action taken against a licensee or license applicant, and adverse action information
regarding a licensee in any member state is available to any other member state.
Section 10: Rulemaking
The commission must develop and adopt rules, in accordance with the OTLC and the rules
adopted under it, to effectively and efficiently implement the OTLC and achieve its purposes.
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 Rules must be adopted at a regular or special meeting of the commission, with notice and a
request for comments provided in member states and on the commission website at least 30
days before the rule is to be voted on. The commission must make public any written materials
submitted in response to proposed rules, and it must convene a public hearing, with opportunity
for public comment, before adopting rules if requested to do so by at least 25 individuals, a
state or federal governmental subdivision or agency, or an association that has at least 25
members. Final action on a proposed rul