The federal government officially shut down at midnight on September 30, 2025, after Congress failed to pass a 2026 funding bill or short-term continuing resolution. While Medicare and Medicaid are considered essential services, and payments to physicians will continue, the shutdown is already creating some challenges for physician practices and patients. 

Telehealth During the Shutdown

As of October 1, Medicare’s pandemic-era telehealth waivers expired, meaning that – with the exception of mental health and substance use disorder treatment and physicians participating in certain Medicare Shared Savings Program ACOs – only patients in rural areas remain eligible for Medicare telehealth services under federal law. (For Medicare, “rural” means a Health Professional Shortage Area or a non-Metropolitan Statistical Area.) This means most traditional Medicare and Medicare Advantage patients outside of rural areas are no longer authorized to receive telehealth visits from their homes, and payment for audio-only visits is no longer permitted. The Acute Hospital Care at Home program has also ended. (These changes apply only to Medicare; Medi-Cal telehealth payments are not affected by the shutdown.)

However, CMS has clarified that physicians may continue to provide and bill for all Medicare telehealth services allowed prior to the shutdown. These claims will be placed on a temporary 10-day payment hold and may be paid retroactively if Congress acts to extend the waivers, as it has in prior shutdowns. There is no guarantee of payment if Congress fails to act, though bipartisan support makes eventual extension and payment likely. Practices may alternatively choose to hold telehealth claims until Congress acts.

Physicians should be aware:

• Because payment is uncertain, CMA advises practices to consider converting telehealth visits to in-person care or rescheduling when possible.
• CMS recommends having patients sign an Advance Beneficiary Notice of Noncoverage (ABN) to allow billing of patients if claims are ultimately denied.

Medi-Cal Payments Unaffected

According to the California Department of Health Services, Medi-Cal payments are not affected by the shutdown at this time. Medi-Cal telehealth claims are also not affected by the expiration of the federal waivers, as telehealth parity is written into statute and is not tied to Medicare.

Program Funding Lapses

Several critical federal health programs expired with the shutdown, including community health center funding, the National Health Service Corps, Teaching Health Center Primary Care GME programs, special diabetes programs, the Medicare-dependent hospital program, and various public health emergency authorities and related funds.

Medicare Payment Processing Delays

In addition to telehealth claims, CMS has instructed its Medicare Administrative Contractors to place a 10-day temporary hold on claims affected by other expired programs, such as the Medicare special diabetes program. This standard practice prevents reprocessing if Congress later acts to retroactively extend programs. Because of Medicare’s 14-day payment floor, these holds should have minimal impact on physicians, but CMA and AMA are closely monitoring for any disruptions.

Congressional Negotiations Continue

There is bipartisan support for extending most expiring health care programs, but disagreements over whether to include the expiring Affordable Care Act (ACA) enhanced premium tax credits in a short-term spending bill have stalled progress. Without an extension of the enhanced premium tax credits, as many as 5 million Americans — including nearly 1 million Californians — could lose ACA coverage.

CMA Support for Physicians

CMA urges physicians experiencing Medicare payment delays or other issues tied to the shutdown to contact CMA’s Center for Economic Services at (800) 786-4262 or economicservices@cmadocs.org. Physicians can also alert AMA advocacy staff about Medicare claims problems at ama.advocacy@ama-assn.org with the subject line “Medicare Payment Delay.”

Looking Ahead

CMA will continue to press Congress to restore pandemic-era telehealth flexibilities, protect funding for workforce programs and extend ACA premium tax credits to safeguard coverage for millions of Americans. We will provide updates as negotiations continue in Washington.