Government Shutdown Deepens Telehealth Disruptions for Medicare Patients

The ongoing U.S. government shutdown, now in its fourth week, is disrupting telehealth services nationwide — particularly for Medicare patients — as providers face uncertainty around payment, compliance, and the fate of COVID-19-era telehealth flexibilities.

Shutdown Leaves Medicare Telehealth Coverage in Limbo

With key federal waivers and funding authorities expired, many health systems have scaled back or paused telehealth services. According to the American Telemedicine Association (ATA), the lack of clarity has led to widespread patient cancellations, an uptick in in-person visits, and added strain on already overextended providers.

“We are being negatively impacted to a severe degree, despite the fact telehealth has earned bipartisan support,” said Kyle Zebley, Senior Vice President for Public Policy at ATA and Executive Director of ATA Action. “Every day that goes by, it’s worse.”

ATA officials warn that disruptions could worsen as flu season approaches, forcing patients into delayed care or emergency departments at a time when healthcare demand typically rises.

Providers Report Widespread Service Interruptions

Without Medicare reimbursement assurances, health systems have begun limiting virtual care for covered patients.

“Our members are experiencing increased patient cancellations, no-shows or unnecessary in-person visits and are having to reallocate staff to mitigate additional workforce challenges,” said Alexis Apple, Director of Federal Affairs at ATA and Head of Government Affairs at ATA Action.

Some hospitals have begun notifying patients directly. The University of Iowa Healthcare, for instance, has warned that telehealth appointments may not be covered during the shutdown. Approximately 680,000 Medicare recipients in Iowa rely on telehealth services, according to KCRG-TV9.

“Seeing the government shutdown stall our telehealth progress has been deeply disheartening and disruptive,” said Dr. Helen Hughes, Medical Director in the Office of Telemedicine at Johns Hopkins Medicine and a member of ATA’s Center for Digital Excellence. “We hope Congress will act swiftly to permanently restore these essential services for our patients.”

Calls for Guidance and Retroactive Payment

With agencies operating under contingency plans, Centers for Medicare & Medicaid Services (CMS) and other departments are unable to process telehealth claims beyond the pre-shutdown limits.

“We urgently need clear guidance from CMS and Congress on extensions for the Medicare telehealth flexibilities and retroactive payment for telehealth claims,” Apple said. “Providers and patients need assurance about the future of virtual care.”

According to Zebley, most healthcare organizations are holding Medicare telehealth claims to avoid nonpayment and compliance risks. Many remain divided on whether to continue offering virtual services or revert to in-person care if the shutdown persists.

System Strain and Patient Delays

Zebley cautioned that the timing of the shutdown could further stress a healthcare system already preparing for seasonal surges.

“You’ll be lucky to see somebody in person in the next couple of months,” he said. “If it’s something more acute, take a ticket and get into the back of the line in the emergency room.”

ATA and its partners continue to advocate for retroactive reimbursement for telehealth services delivered during the shutdown. A recent CMS update confirmed that telehealth claims for behavioral and mental health services remain eligible for processing — one of the few virtual care categories unaffected.

“Telemental health is still a permanent feature of the Medicare program, even with this ongoing lapse,” Zebley said. “But the question remains about new patients who would have been established this month, and which providers can offer these services.”

Broader Policy Concerns and the E-Prescribing Gap

Beyond telehealth coverage, ATA has expressed growing concern over a potential lapse in e-prescribing rules for controlled substances. The Drug Enforcement Administration (DEA) and HHS had previously extended virtual prescribing flexibilities through the end of 2025, but further policy action may be delayed by the shutdown.

“There’s nothing about a shutdown that precludes the administration from extending the waiver,” Zebley said. “We’re calling on them to do it today, now.”

ATA warns that agency slowdowns may delay efforts to finalize regulations and registries for telehealth prescribers.

“This couldn’t come at a worse moment in terms of a healthcare system under duress, overstretched with too little capacity,” Zebley added. “We’re exacerbating that at the worst possible time.”

Outlook

While telehealth remains broadly supported across party lines, the current funding impasse has underscored how dependent virtual care has become on federal policy continuity.

“Despite bipartisan support, telehealth has become collateral damage in Washington’s political gridlock,” Zebley said. “There’s no way to run a country — or a healthcare system — like this.”