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October 1, 2025
Federal Government Shutdown – What It Means for Medicare Advantage Plans
As of October 1, 2025, the U.S. federal government has officially entered a full shutdown. Congress failed to pass any of the 12 appropriations bills required to fund government operations for the new fiscal year, resulting in a lapse of funding across all federal agencies.
A Brief History of Shutdowns
Since 1977, the federal government has shut down 21 times, totaling 162 days. The longest shutdown occurred in 2018–2019, lasting 35 days. Shutdowns occur when Congress does not pass either full-year appropriations or a continuing resolution to temporarily extend funding.
What This Means for Medicare Advantage Plans
While Medicare is funded through mandatory spending and will continue to operate, there are important caveats for plans and providers to monitor:
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Core Benefits Continue: Beneficiaries will still receive medical care, prescriptions, and hospital services. Enrollment and eligibility functions remain active and Annual Election Period (AEP) should not be disrupted by this shutdown.
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Administrative Delays Possible:
- The Centers for Medicare & Medicaid Services (CMS) anticipates furloughing nearly half its staff, which could lead to longer wait times for regulatory and operational support.
- With fewer staff available, Medicare Advantage (MA) plans may experience delays in receiving communications through HPMS and communication with Account Managers may also be impacted.
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Temporary Claims Hold: When certain legislative payment provisions (“extenders”) are scheduled to expire, CMS directs all Medicare Administrative Contractors (MACs) to implement a temporary claims hold. This standard practice, typically lasting up to 10 business days, ensures that Medicare payments are accurate and consistent with statutory requirements. Providers may continue to submit claims during this period, but payments will not be released until the hold is lifted. The 14-day payment floor minimizes the impact on providers.
Telehealth Services
Many of the statutory limitations that were in place for Medicare telehealth services prior to the COVID-19 Public Health Emergency will take effect again for services that are not behavioral or mental health services. Key changes include:
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Restrictions on Telehealth Services: Prohibition of many telehealth services provided to beneficiaries in their homes or outside of rural areas. Hospice recertifications will also require a face-to-face encounter.
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Impact on Eligibility: These restrictions may affect requirements for meeting continued eligibility for other Medicare benefits.
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Claims Submission: Providers may choose to hold claims associated with telehealth services that are not payable by Medicare in the absence of Congressional action.
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Payment Limitations: Medicare will not be able to pay certain practitioners for telehealth services unless Congressional action is taken.
What to Watch For
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Member Services Impact: Be prepared for increased member inquiries due to confusion or delays in administrative processes.
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Legislative Developments: Stay informed on Congressional negotiations, as any resolution could include health policy changes that may affect Medicare Advantage plans.
BluePeak’s Commitment
BluePeak will continue to monitor the situation closely and provide timely updates as new information becomes available. If you have specific concerns or operational impacts that require support, please email info@bluepeak.com.
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