Telehealth, hospital-at-home providers scramble ahead of cutoff

Modern Healthcare – Monday, September 29, 2025
By Michael McAuliff

The legal authority that allows Medicare to reimburse for telehealth and hospital-at-home services is about to disappear amid congressional inaction, leaving providers and businesses scrambling.

Congress left Washington two weeks ago without funding the federal government or addressing a slew of healthcare priorities that are set to sunset along with fiscal 2025, including telehealth and hospital-at-home policy. Unless President Donald Trump and the Republican congressional majority can strike a deal with Democrats before Wednesday, the government will shut down and telehealth and hospital-at-home providers will lose access to Medicare payments.

“It’s extraordinarily damaging,” said Kyle Zebley, a senior vice president of public policy at the American Telemedicine Association. “Just about every hospital system, healthcare system, provider group that delivers care to Medicare beneficiaries — and that’s mostly all of them — are in war game mode right now.”

Trump and Congress opened the door to wider adoption of telehealth and hospital-at-home care during the COVID-19 pandemic in 2020, and the policy immediately proved popular with providers, vendors and patients. But these policies have gotten only temporary extensions, the last of which runs out at midnight EST Wednesday.

As they peer over the cliff, healthcare companies face difficult choices, Zebley said. “It’s kind of the kaleidoscope of ideas of how they’ll be responding,” he said.

Options include ceasing all remote services, finding creative ways to shift appointments on-site or reschedule them, providing remote services for free, or coming up with some system that may allow providers to bill Medicare later.

Federal law does not bar providers from treating Medicare beneficiaries remotely if the authority lapses, but it would erase the ability to bill the government except in limited circumstances, said Igor Gorlach, an attorney and partner at the law and lobbying firm King & Spalding.

“The majority of the telehealth visits that have been scheduled will no longer be reimbursable,” Gorlach said.

Acute hospital-at-home providers may have the toughest time because the services they offer tend to be complicated, extensive and expensive.

OSF HealthCare would simply stop providing hospital-at-home care in the absence of Medicare payments, said Jennie Van Antwerp, director of digital acute care at the Peoria, Illinois-based nonprofit Catholic health system.

“Providers will switch caring for patients who could be treated at home, to treating them in the hospital,” Van Antwerp said. “The benefit of freeing up beds for the sickest patient will no longer be extended to health systems such as OSF HealthCare.”

On the other end of the spectrum, some telehealth businesses may well decide to risk losses and keep providing care, said Justin Schreiber, CEO of telehealth vendor LifeMD.

“If there is a short-term shutdown, we’re going to continue to treat Medicare patients,” Schreiber said. LifeMD hopes Congress or the Centers for Medicare and Medicaid Services would later make providers whole through retroactive reimbursements, he said.

Medicare beneficiaries make up a small share of LifeMD’s patients, which would make operating under reimbursement uncertainty feasible for at time, Schreiber said. “We can kind of weather the storm a lot better than a lot of other providers out there across the country,” he said.

The American Telemedicine Association has appealed to Congress to pass legislation to make sure delayed payments can be made, Zebley said.

Also, while CMS has not yet revealed if it has contingency plans for a shutdown, the agency may be able to devise a “workaround” to reassure providers that they won’t provide services and not get paid, Gorlach said.

“This administration has been willing to push beyond various legislative and other limits,” Gorlach said. “If any administration would do it, it probably would be this one.”

More likely, Gorlach said, is the agency would merely warn providers and patients about the lapse in Medicare reimbursement, which could leave patients on the hook for unpaid bills.

But a gap of any duration and severity would challenge providers, Katie Rubinger, a senior manager at the consulting firm Manatt Health, wrote in an email.

“While history indicates that usually these extenders will be reauthorized retroactively when the shutdown concludes, the uncertainty in the interim will likely cause deep concern among providers,” Rubinger wrote. “In the case of a government shutdown, CMS may hold off on processing claims for these services (which may lead to delays in provider reimbursement) or reject these claims since the services are no longer authorized.”

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