Government Shutdown Update: CMS Backs Off Full Medicare Payment Pause

October 17, 2025

In a major relief for providers — especially those serving Medicare clients — CMS has clarified that Medicare payments will not be fully paused during the ongoing government shutdown.

Earlier reports suggested that all Medicare claims could be frozen, sparking panic among billing offices and practice owners. However, CMS has since confirmed that only a limited category of claims will face temporary processing holds, primarily those tied to expired legislative provisions — including some telehealth flexibilities and rural program adjustments.

What This Means for Mental Health Practices

For most behavioral health providers, routine outpatient therapy, psychiatry, and psychological services will continue to process and pay normally.

Here’s the breakdown:

Claims for standard in-person therapy (e.g., 90791, 90837, 99213, etc.) are not affected.

Telehealth sessions that fall under expired waivers (non-behavioral or non-rural categories) could see temporary holds or denials until Congress renews those provisions.

Federally Qualified Health Centers (FQHCs) and rural practices may still see slower turnaround for certain program-specific claims, but CMS emphasized that most physician-fee-schedule mental health claims remain on the standard 14-day payment floor.

Telehealth Coverage Still Protected for Behavioral Health

The good news:

CMS reaffirmed that mental and behavioral health telehealth services remain protected under the Consolidated Appropriations Act of 2023, which extended those flexibilities through December 31, 2025.

This means that for most therapy and psychiatry services, telehealth claims should not be delayed or denied unless tied to other expired programs outside of behavioral health.

✅ What’s still covered:

Teletherapy and telepsychiatry visits for all geographic areas

Home as the originating site

Audio-only behavioral health visits

Supervision and care coordination under the behavioral health umbrella

🚫 What could be impacted:

Certain rural support modifiers

Services outside the behavioral health category

Claims tied to pilot programs or lapsed “payment extenders”

What Practices Should Do Right Now

Continue submitting Medicare claims as usual. Most will process normally under the standard 14-day window.

If any telehealth claims show as pending beyond 14 days, check whether they’re linked to an expired provision or waiver.

For edge-case services (e.g., dual medical-behavioral codes or pilot programs), consider adding an Advance Beneficiary Notice (ABN) if payment uncertainty exists.

Monitor CMS updates — particularly if Congress delays action on program extensions past late October.

GBBS Perspective: Why This Matters

As a boutique RCM agency focused on mental health, Golden Bee Billing Services closely tracks every CMS policy shift that could affect therapy practices.

A full payment freeze would have disrupted cash flow across group practices and solo clinicians alike — but thanks to this clarification, most mental health providers can continue billing confidently.

Still, the situation remains fluid. If Congress fails to re-authorize the expired “extender” programs soon, additional holds or retroactive adjustments could appear later this fall.

✳️ Key Takeaway

> Mental health telehealth remains safe — but stay alert for program-specific holds.

CMS is not pausing all payments; only limited claims tied to expired federal provisions are temporarily held.

Practices should continue to bill normally, watch remittance timing, and stay tuned for further updates.

Previous:

CMS Guidance During Government Shutdown: What Mental Health Providers Need to Know

When the federal government shuts down, providers often worry first about revenue flow — and with good reason. Billing doesn’t stop just because Washington does. This week, CMS issued guidance to help practices understand what to expect for claims processing and telehealth coverage while the shutdown is in effect.

CMS Guidance During Government Shutdown

Claims Submission & Payment Holds

The most important reassurance: claims can still be submitted as usual. Clearinghouses and electronic systems remain active. However, CMS has directed Medicare Administrative Contractors (MACs) to temporarily hold payments for up to 10 business days.

This does not mean claims are denied. The hold allows CMS flexibility to reprocess payments quickly if Congress resolves funding and makes retroactive adjustments.

For practices, this means:

• Submit claims on schedule to avoid backlog

• Prepare for short-term cash flow delays

• Communicate with staff and leadership so teams aren’t caught off guard

  
  

Telehealth Flexibilities Have Expired

Alongside the shutdown, several COVID-era telehealth waivers have now lapsed. Unless Congress acts to extend or reinstate them, the following changes apply to Medicare fee-for-service:

• Geographic and originating site restrictions are back in place. Patients generally must be located in a rural area and at an approved originating site.

• Audio-only telehealth is no longer broadly covered. Only certain exceptions remain, including mental health and substance use disorder services with conditions attached.

• Home-based telehealth in urban areas may no longer qualify for Medicare reimbursement.

For mental health practices, this means you should:

• Review coverage rules for each Medicare patient before scheduling telehealth visits

• Issue an Advance Beneficiary Notice (ABN) if providing services outside current coverage

• Monitor private payers, as some follow Medicare’s lead on coverage decisions

medicare telehealth flexibility expired

GBBS Recommendations

At Golden Bee Billing Services, our role is to help practices weather policy changes without disruption to compliance or revenue. During this shutdown, we recommend:

1. Continue normal billing operations — submit promptly, even if payments are delayed.

2. Communicate clearly with patients about telehealth limitations and possible out-of-pocket costs.

3. Track denials and delays so they can be appealed or corrected quickly once funding is restored.

4. Stay updated — Congress may retroactively restore telehealth flexibilities or payment timelines.

Stay updated with word from Congress

The Bottom Line

Shutdowns are disruptive, but they don’t have to derail your practice. By staying proactive with claims, transparent with patients, and aligned with CMS guidance, your practice can continue to deliver care while protecting revenue.

At GBBS, we’ll keep monitoring developments and provide updates as they unfold. If you need tailored support for claims management, denial prevention, or compliance strategy, reach out today at www.gbbillings.com