Questions loom over the future of telehealth policy

Federal telehealth policy continues to prove confounding for healthcare providers.

The recent 43-day government shutdown marked the first extended period since the early days of the COVID-19 pandemic that traditional restrictions on telehealth reimbursement were in place. Medicare waivers of those restrictions helped telehealth utilization surge during the pandemic and remain elevated in the years since.

After constituting less than 0.05% of outpatient visits in 2019, for example, telehealth rose to 25% in April 2020 and still was at 4% in March 2023, according to data analyzed in a 2025 study. By the end of 2026, according to projections by one healthcare IT company, up to 30% of all medical appointments will be telehealth visits.

That estimate presumes Congress will ensure retention of the current regulatory flexibilities. The Medicare waivers were restored in the deal to fund the government, but only for the duration of the continuing resolution, which runs through Jan. 30.

The increased emphasis on telehealth left some providers in a bind when the waivers expired during the shutdown. The week after the Nov. 12 full reopening of the government, providers still were reporting telehealth payment backlogs of two to three weeks.

“Some of these clinics and healthcare organizations are operating with very thin margins, and they have a lot of financial pressure,” said Hari Prasad, co-founder and CEO of Yosi Health, a pre-arrival and patient engagement solutions platform that works with providers. “They have a lot of staffing challenges. So when you add delayed payments, that also impacts a lot of operational aspects for them.”

Less ambiguity for hospital-at-home

Whereas federal telehealth policy remains murky, the House of Representatives recently took a step toward clarifying the long-term status of hospital-at-home care.

A bill that passed the lower chamber by unanimous consent Dec. 1 would extend the program through September 2030, allowing Medicare to maintain reimbursement at inpatient rates when enrollees receive acute-care services in their homes. The bill is under consideration in the Senate, where legislation mirroring the concepts in the House bill previously drew bipartisan sponsorship during the current Congress.

Without the new legislation, hospital-at-home waivers would be scheduled to expire Jan. 30, just like the telehealth waivers. During the government shutdown, CMS halted the program.

“Home healthcare options provide patients with high-quality care at lower costs, reduce the risk of hospital-acquired infections, and increase recovery outcomes for patients,” Rep. Lloyd Smucker (R-Pa.), who co-introduced the House bill, said in remarks on the chamber’s floor.

As described in a government study, hospital-at-home patients had lower mortality rates, while the program’s impact on readmission rates varied significantly by DRG. Medicare spending was notably lower over a 30-day post-discharge period, compared with a control group, while metrics reflecting patient experience were favorable.

More than 400 hospitals nationwide have been approved for the hospital-at-home program since the waiver was initiated during the first year of the pandemic.

In comments supporting the House bill before its passage, the American Hospital Association (AHA) observed that going through federal and state regulatory approvals for hospital-at-home waivers can take a year or more. The process becomes more daunting if hospitals do not have long-term certainty about the program, the AHA said.

Telehealth bill not making progress

The House also drafted a 2025 bill that would permanently extend the telehealth waivers, including allowing patients to receive telehealth services in their homes and in any geographic location. That legislation has not made comparable headway to the hospital-at-home bill, instead remaining under consideration at the committee level.

The discrepancy in the prospects for the two bills partially stems from the narrower scope of hospital-at-home, whereas telehealth coverage expansion has a larger span across healthcare settings and thus raises questions about federal costs, along with fraud risk. As a result, telehealth legislation involves a range of guardrails and budgetary offsets that can complicate passage.

Although the big questions about telehealth policy rest with Congress, CMS incorporated changes in final regulations set to take effect in 2026. The provisions include streamlined criteria for evaluating which telehealth services are eligible for Medicare payment. For 2026, the list of eligible services was expanded to include an infectious disease add-on code (HCPCS G0545) for inpatient visits, among other additions.

The same final rule permanently removed frequency-related restrictions on telehealth visits in hospital inpatient settings, skilled nursing facilities and critical care consultations. Another pandemic policy made permanent in the rule allows physicians to supervise diagnostic imaging services via a real-time video connection.

The budget reconciliation bill known as the One Big Beautiful Bill Act included a narrow provision to boost telehealth access. As stipulated in the legislation, high-deductible health plans are added to the list of plans that can offer telehealth with no out-of-pocket cost to the patient. That pandemic-era accommodation had expired at the end of 2024 but has been restored retroactively.

Trepidation about what lies ahead

Provider advocates hope telehealth will become permanently established as a reimbursable part of the healthcare ecosystem.

At a minimum, the hope is that the confusion that was prevalent in October and the first half of November will not resurface in late January. CMS issued multiple notices trying to clarify telehealth reimbursement policy as affected by the expiration of the waivers amid the shutdown. In its most recent announcement, the agency affirmed that all telehealth services furnished during the shutdown would be paid “as if there hadn’t been a temporary lapse” in the waivers.

If the shutdown had lingered much beyond the record-setting duration it reached, Yosi Health was expecting to see providers cut back on their telehealth service offerings, Prasad said.

“Some of our providers were not sure if they should continue providing these virtual programs, not knowing if they were going to be reimbursed,” he said. “A lot of them had to adjust their billing processes and make changes in terms of how those were being built, and then [deal with] the cash flow when it started getting affected as well.

“It’s really the uncertainty that added a lot of anxiety to our clients in terms of: Should this be offered on an ongoing basis?”