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November 13, 2025 – The end of the longest government shutdown in US history is finally here, with the president having signed a continuing resolution (CR) that funds the government through January 30, 2026. The CR temporarily extends numerous health “extenders” for the period of October 1, 2025, through January 30, 2026.
As outlined in previous Regs & Eggs blog posts, the expiration of the healthcare extenders on September 30, 2025, created some confusion, and in response the Centers for Medicare & Medicaid Services (CMS) put out multiple rounds of guidance about what Medicare claims could still be processed. Now that the waivers and policies are restored retroactively to October 1, 2025, CMS could put out more guidance, this time explaining how claims impacted by the government shutdown can now be paid. CMS would likely issue such guidance after the agency has the opportunity to analyze the CR’s specific language and determine an appropriate path forward. Although we may not see this guidance until later this week or next, to help me explain what to expect from CMS on Medicare payments (when we’re expecting the end of the government shutdown), I’m bringing in my colleague, Rachel Stauffer.
As described in a previous Regs & Eggs blog post, certain Medicare “extenders” got tied to the government shutdown since they expired on September 30, 2025. These policies are temporary in nature, but Congress has routinely extended them every year, and they were expected to do so again. Three expired policies had major implications on Medicare claims processing during the shutdown: the telehealth waivers, the Acute Hospital Care at Home (AHCAH) waiver, and the work geographic practice cost index (GPCI) floor of 1.0.
Telehealth waivers have allowed Medicare telehealth services to be performed in both urban and rural areas and have allowed Medicare beneficiaries to receive telehealth services from their homes. Other telehealth flexibilities have included:
These waivers and flexibilities have been in place since March 2020 through the authorities of the COVID-19 public health emergency and subsequently through statutory extensions passed by Congress. Congress has separately addressed behavioral and mental telehealth services, and CMS has provided separate telehealth flexibilities to certain accountable care organizations, but these waivers have continued to apply to most other Medicare telehealth services.
After the waivers expired on September 30, 2025, CMS clarified a few times how Medicare Administrator Contractors (MACs) were to handle impacted claims (i.e., claims for services that were no longer covered by Medicare). In CMS’s latest update on November 6, 2025, the agency recommended that providers wait to submit claims for these services until the government shutdown ended and Congress provided clarity on whether the expired waivers would be restored. If providers did not want to hold these claims, they could submit them with the GY modifier, and the claims would be denied. CMS stated that if Congress restored the broader range of telehealth services payable by Medicare, the agency would provide guidance on whether providers should resubmit telehealth claims that included the GY modifier.
As this CR officially becomes law and the waivers are retroactively restored to October 1, 2025, CMS could soon issue new instructions that would:
MACs likely did not process and deny many telehealth claims with a GY modifier since the instructions were just provided last week, so they may not have to reprocess many claims. However, if providers continued to provide telehealth services during the shutdown and have been holding on to a bunch of claims, we may see a processing backlog once providers submit those claims to MACs. While MACs have a 14-day payment floor for electronic claims (under Section 1816(c)(3) of the Social Security Act), they typically try to pay claims within 30 days. We will see if MACs are able to maintain this usual timeline over the next few weeks, or if there are residual delays in certain payments.
CMS implemented the AHCAH waiver program in 2020 to allow Medicare beneficiaries to receive acute-level care at home, and Congress extended the program multiple times. The waiver expired on September 30, 2025, and will be retroactively restored in the CR through January 30, 2026. In its November 6 guidance, CMS reminded hospitals that it had already stated that all hospitals with active AHCAH waivers had to discharge or return all inpatients to the hospital. If hospitals submitted AHCAH claims with dates of service on or after October 1, 2025, the claims would be returned to them for correction. CMS also stated that if hospitals did not want to hold these claims, hospitals could submit them with bill type 110 and condition code 21 and they would be denied. CMS stated that if Congress were to retroactively extend the AHCAH waivers, the agency would provide future guidance on whether hospitals would need to resubmit AHCAH claims previously submitted for denial.
Now that the waiver has been restored, we expect CMS to issue this promised guidance on whether hospitals will need to resubmit AHCAH claims that were denied. CMS may also need to issue guidance that officially restores the AHCAH waivers to hospitals that previously had them and clarifies that hospitals can go back to their practice of allowing certain patients to receive services at their homes rather than at the hospital. Since CMS told hospitals to discharge or return all inpatients to the hospital, it may take a while for some hospitals to restart their AHCAH programs.
Potentially one of the most complicated Medicare claims processing issues during the shutdown has involved the work GPCI floor. Medicare Physician Fee Schedule payments are updated by geographic factors called GPCIs. There are 109 GPCI localities, each with three different GPCIs: work, practice expense, and malpractice. To augment payments in rural areas, Congress temporarily enacted a floor of 1.0 for the work GPCI and extended that floor multiple times. Of the 109 localities, more than 50 have work GPCIs below 1.0 and are therefore supported by the work GPCI floor. When the policy expired on September 30, 2025, all localities that had been protected by the floor saw their work GPCIs decrease slightly.
A previous Regs & Eggs blog post highlighted CMS’s dilemma as to whether it should hold or process certain claims during the shutdown, and noted that the work GPCI floor illustrated why CMS initially decided to hold these claims. In many cases, the cost of reprocessing claims if the work GPCI floor were restored could be as much or more than the difference between the final payments for services. We provided a hypothetical example to illustrate: let’s say that a payment for a service in a state with a work GPCI below 1.0 would be $99.75 without the floor of 1.0 and $100 with the floor. (Many localities that have work GPCIs below the 1.0 mark are just below 1.0. The locality with the lowest work GPCI, Mississippi, has a work GPCI of 0.950 in 2025.) If MACs processed the claim at $99.75 (for a date of service on or after October 1, 2025), and Congress later restored the floor retroactive to October 1, 2025, MACs would be required to reprocess the claim at $100, which is a difference of only $0.25. Processing and reprocessing the claims could cost more than $0.25, so from that perspective it could make sense for CMS to try to avoid having to reprocess claims for these very small discrepancies.
At the same time, many providers wanted MACs to process claims in order to get some payment ($99.75 in this example), which they stated was better than getting nothing while claims were held. On October 21, 2025, the agency decided to lift the hold, which effectively meant that MACs could start processing Physician Fee Schedule claims in localities with work GPCIs below 1.0 with dates of service on or after October 1, 2025. Now that Congress has restored the work GPCI floor of 1.0 retroactive to October 1, 2025, MACs may need to reprocess all the claims that have already been processed.
Reprocessing Medicare claims can be costly and administratively burdensome, and the CR does not provide CMS with additional funding for reprocessing. In the past, CMS has issued memos (like this one) with instructions to MACs for reprocessing claims. Such guidance could shed some light on how many claims need to be reprocessed, how long MACs will have to reprocess them, and whether reprocessing a lot of claims could impact MACs’ ability to process new claims in a timely manner.
Now that the CR has been enacted, CMS will likely issue guidance on how to formally revive these expired policies and ensure that providers are paid for services they delivered during the shutdown. The CR includes many other extenders, some of which also have direct Medicare payment implications, so CMS will certainly be busy trying to get Medicare claims processing back to its normal operations. Guidance could be posted on this website, so you can keep checking it in the coming days (we certainly will be!)
One final note: the extenders are only extended until January 30, 2026. Thus, Congress will need to act again before that deadline if we want to avoid having to go through this exercise again!
Until next week, this is Jeffrey (and Rachel) saying, enjoy reading regs with your eggs.
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