What a Government Shutdown Would Mean for Your Rehab Therapy Practice

UPDATE 10/17/25: CMS has revised its guidance to direct Medicare Administrative Contractors to process and pay claims in a timely manner, with the exception of claims impacted by the now-expired provisions. It's unclear what rate will be paid for those in sub-1.00 GPCI localities

UPDATE 10/1/2025: In new guidance, CMS has instructed Medicare Administrative Contractors to implement a temporary claims hold in order to avoid potentially have to reprocess payments in the event of legislative changes after the expiration of current rules. The temporary claims period is typically ten business days, and as CMS notes, the hold "should have a minimal impact on providers due to the 14-day payment floor," and that "providers may continue to submit claims during this period, but payment will not be released until the hold is lifted." CMS states that "MACs will continue to perform all functions related to Medicare Fee-for-Service claims processing and payment."

In this latest directive, CMS also reemphasizes that temporary telehealth privileges that had been extended have now expired, meaning that rehab therapists cannot a present bill for those services. While it is possible that telehealth privileges will be extended again as part of government funding measures, rehab therapists should exercise caution by providing patients with an ABN for telehealth services, holding Medicare telehealth claims, or both.

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A possible government shutdown comes with plenty of questions for those who rely on federal funding to operate their businesses or simply live their lives, with Medicare and Medicaid patients and providers high on that list. So, with a looming shutdown on the horizon, should you be concerned about your Medicare and Medicaid patients being able to get the care they need—or whether you’ll get paid for that care?

The short answer is that Medicare patients shouldn’t worry about being able to see their providers, including rehab therapy, although there may be delays to some Center for Medicare and Medicaid Services (CMS) activities.  As outlined in this blog from the AARP, programs like Medicare, Medicaid, and Social Security are among those deemed as mandatory spending by the government, and as such sit outside the appropriations process unfolding in Congress, and in the event of a shutdown, the Department of Health and Human Services (HHS) has promulgated a contingency plan for CMS that ensures essential functions are still being fulfilled. In this policy, HMS also outlines that Medicaid has sufficient funding through the first fiscal quarter of 2025, in the event of a prolonged shutdown. 

However, the timing of the shutdown would impact some policies that require annual legislative action. The telehealth privileges rehab therapists currently enjoy expire as of September 30, as does the mandated floor of 1.0 for Geographic Practice Cost Indices (GCPIs) for certain rural states, meaning those with a sub-1.00 GCPI could see a reduction should MACs choose to make those adjustments during the shutdown. Per APTQI Executive Director Nick Patel, both telehealth privileges and the 1.00 GCPI floor are likely to be included in whatever funding resolution passes, but in the meantime, providers in those localities should flag claims submitted in the interim in order to collect on the difference. (For reference, we've listed out the potentially affected localities at the bottom of this blog.)

CMS itself wouldn’t be totally unscathed should the government shutdown actually go into effect. Some of the functions that would shut down include health care facility survey and certification, contract oversight, including Medicare Administrative Contractors (MACs), outreach and education, beneficiary casework, and, notably, policy and rule making.  Per that same guidance, “CMS payment rule development and other policy decisions would depend on the funding source and duration of a lapse in appropriation.  With limited staff to review and provide operational support, we would expect delays in rule-making and other policy development,” which suggests that a significant shutdown could delay the release of the 2026 final rule. 

In the short term, rehab therapy clinics should be able to operate as normal during a shutdown. However,  as with past shutdowns, healthcare providers should keep a close eye on proposed changes to funding and eligibility around Medicare and Medicaid in any continuing resolution passed to fund the government. 

Localities with a sub-1.00 GPCI

MISSISSIPPI

ARKANSAS

REST OF MISSOURI

IDAHO

KENTUCKY

WEST VIRGINIA

UTAH

REST OF MAINE

MONTANA**

TENNESSEE

KANSAS

OKLAHOMA

REST OF LOUISIANA

REST OF GEORGIA

IOWA

REST OF FLORIDA

NEBRASKA

REST OF ILLINOIS

SOUTH CAROLINA

INDIANA

VERMONT

SOUTH DAKOTA**

WYOMING**

REST OF MICHIGAN

NEW MEXICO

NEW ORLEANS

ALABAMA

REST OF OREGON

FORT LAUDERDALE

SOUTHERN MAINE

NORTH DAKOTA**

EAST ST. LOUIS

ARIZONA

METROPOLITAN ST. LOUIS

METROPOLITAN KANSAS CITY

NORTH CAROLINA

OHIO

MIAMI

BEAUMONT

WISCONSIN

REST OF TEXAS

NEVADA**

REST OF PENNSYLVANIA

REST OF NEW YORK

NEW HAMPSHIRE

HAWAII, GUAM

MINNESOTA

ATLANTA

PUERTO RICO

AUSTIN

VIRGIN ISLANDS