Medicare, Telehealth Coverage & the Government Shutdown: What You Need to Know Now 2.0

On March 2, 2025, I wrote a blog on the future of telehealth. In March, we still hoped that the Medicare requirement to see telehealth clients once a year would be permanently eliminated. That might happen but not now. Due to the government shutdown, there was no opportunity for Congress to further discuss or vote on the issue. Consequently, after 5.5 years, the Covid-era Medicare telehealth waivers expired on October 1, 2025. The future is now.

What mental health clinicians need to know—facts and action steps.

Good News First

Unlike medical services, Medicare permanently covers telehealth for mental health treatment.

• No geographic restrictions for mental health
• Audio-only coverage remains permanent for mental health

What Changed On October 1, 2025

With the help of Susan Frager, the Psych Billing Coach, NASW, the APA, and HHS, here’s what I can tell you…

In-person visits are now required. That’s it. Everything else about mental health telehealth coverage remains the same. Here’s the recap:

The Rules:

1. New clients must be seen at least once in-person before starting telehealth visits. There are NO exceptions to this requirement.
2. On-going clients, those you’ve been seeing via telehealth since the pandemic, do NOT need an initial in-person session. (They’ve already had an initial session!)
3. All clients will be required to have one in-person session once per year, or every 365 days starting October 1, 2025.

Are there exceptions?

For new clients: To repeat – no, new clients must be seen in person first.

For the annual in-person follow-up: Yes, there are exceptions. However, Medicare’s language is non-specific and leaves the rationale to us:

If the patient and practitioner consider the risks and burdens of an in-person service and agree that … these outweigh the benefits … and the practitioner documents the basis for that decision in the patient’s medical record, then the in-person visit requirement is not applicable for that 12-month period. …

…situations in which the risks and burdens associated with an in-person service may outweigh the benefit could include … instances when an in-person service is likely to cause disruption in service delivery or has the potential to worsen the patient’s condition(s). … Other examples … may include the clinician’s professional judgement that the patient is clinically stable and/or that an in-person visit has the risk of worsening the patient’s condition, creating undue hardship on self or family, or if it is determined that the patient is at risk for disengagement with care that has been effective…

Translation: I hesitate to give them too much credit but, it could be that Medicare trusts the clinician and the client to make the determination.

Recommendation: Carefully and thoughtfully document why in-person visits aren’t appropriate.

Examples of documentation that would likely support an exception:

• Medical condition/disability makes in-person visits impossible or harmful (be specific about how and why)
• Transportation difficulties combined with clear explanation of impact on treatment engagement
• Evidence that telehealth treatment has been effective and client is clinically stable

Always document that the client is safely managed via telehealth with no risks (suicidality, etc.) requiring in-person contact. Documenting the appropriateness for telehealth has been a requirement since the pandemic.

What if I can’t see clients in person?

Medicare will ask why. Expanding your practice geographically, for instance state-wide, or multi-state, is not a good enough answer. But there are some solutions with a little creativity:

• Sublet a colleague’s office as needed.
• Conduct in-home visits if the client is local and use POS 12 for location. (Yes, driving to a client’s home is time consuming but I did home visits for 12 years and loved all but the time investment. You get a whole new appreciation for how a client lives.)
• Rent space from a medical practice and maybe develop a referral relationship.

Critical: Update your Medicare enrollment for any new service location, including “as-needed” offices or home visits. Medicare won’t pay for locations that are not on your enrollment profile. (Thank you, Susan Frager, for your billing expertise.)

What about Medicare Advantage?

Advantage plans must cover telehealth for mental health—it’s federal law (42 CFR § 422.101). They must cover everything Original Medicare covers.

However, in-person visit requirements are at each plan’s discretion. You can either call every plan (and spend hours on hold) or follow Original Medicare rules for all Advantage clients.

Can I keep seeing existing clients via telehealth?

Short answer: Probably, but not with 100% certainty.

The APA says you can continue with existing clients without an immediate in-person visit. The 2023 Physician Fee Schedule Final Rule supports this:

From page 69464: “However, we clarify that we do not believe this requirement applies to beneficiaries who began receiving mental health telehealth services in their homes during the PHE (public health emergency).

You’ll still need an in-person visit before September 30, 2026—unless the rules change again. (Here’s hoping!)

What To Do If Meeting In-Person Is Not An Option

During your first October telehealth visit:

1. Document clearly and specifically why an in-person session wasn’t conducted. If you already had your first October telehealth sessions and documented them, you can write an addendum to your progress notes.
2. Have the client sign an Advanced Beneficiary Notification (ABN) form. This allows the client to make cash payments for non-covered services.

Claims, Payments, and Audits

Claims: Medicare Administrative Contractors (MACs) have been directed to temporarily hold claims for 10 business days for dates of service that start on October 1, 2025. Holding claims avoids the need to re-process claims should Congress, when it resumes session, decide to extend the waiver again or make it permanent.

Payments: Unfortunately, the temporary withholding of claims means there will likely be some delay in Medicare payments. At the same time, this also indicates that there is a good chance that these restrictions will be reversed when the government shutdown ends. NASW and the APA have been lobbying to have these restrictions permanently lifted.

Audits: Medicare typically avoids conducting audits during periods when policy is in flux—like right now. Hopefully, we’ll have more clarity and good news when the government resumes sessions.

Does This Requirement Also Apply to Medicaid and Commercial Insurance, and Out of Network Providers?

Officially, the in-person requirement applies only Medicare. BUT, Medicaid and some commercial insurance companies may decide to follow their lead. Medicare is Federal law and sets the standards that most insurance companies follow. Given who Medicaid serves, it’s hard to believe that it would be so restrictive. But Medicaid is staring down the barrel of budget cuts and commercial insurances are staring down the barrel of rate increases. Requiring the first visit to be in-person, may be one of the restrictions they use to limit access to care and save money.

How the question applies to out of network providers is a bit more complex.

Out of network providers (OONs) who provide super bills so clients can get reimbursed for services, are subject to the same requirements to justify medical necessity. Yes, OON providers are audited. It’s not as often but it does happen. When the insurance company pays the bill, the provider has to follow the rules. However, the billing structure is a different story. The client pays you and gets reimbursed by their insurance company.

While out-of-network providers aren’t bound by Medicare’s billing requirements, your clients may find their insurance company won’t reimburse them for telehealth services that don’t meet this in-person requirement. So the requirement could still affect whether your clients can get reimbursed, even though it doesn’t legally bind you as the provider. Confusing, I know. Time will tell what happens.

I hate to say it, but it’s best to check with the individual insurance companies. Maybe they will be proactive and publish something on their provider portal. But I’m not holding my breath.

Here’s hoping that when the shutdown ends (may it be soon) that the waiver is permanent.

Can I do nothing, and hope Congress retroactively extends the waiver?

You could if you are not risk averse. But as hopeful as I am, I wouldn’t hold my breath banking on a good outcome. It doesn’t take that much to comply with the current rules for existing clients. Clear documentation about why you can’t see clients in person will suffice. However, for those of us who only offer telehealth sessions, seeing new clients in-person is a challenge and will take some creativity. Since I am risk averse, I believe it’s best to follow the rules as best you can and document thoroughly, particularly when you can’t.

Unfortunately, the current in-person requirement can act as another barrier for clients seeking services, reducing, yet again, access to care. You can help reverse this trend by writing to your member of congress about the benefits of a permanent waiver.