Government shutdown leaves physician practices in limbo, MGMA warns

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As the U.S. government entered a partial shutdown on Oct. 1, physician practices across the country were immediately thrust into ambiguity. Key Medicare policies expired at the same time, removing critical flexibilities and leaving practices uncertain about how to deliver and bill for patient care.

At issue are two provisions: Medicare telehealth waivers and the 1.0 work Geographic Practice Cost Index (GPCI) floor. Both expired with the shutdown, and medical group leaders warn that their loss could have far-reaching consequences.

Telehealth rules that were expanded during the COVID-19 pandemic had allowed a wider range of providers to offer virtual visits and broadened patient access beyond rural areas. Practices invested heavily in digital tools and workflows to support this shift. Now, with those flexibilities expired, administrators face difficult choices — whether to cancel appointments, push patients back into offices, or continue virtual visits at the risk of not being reimbursed. The Centers for Medicare & Medicaid Services has directed contractors to hold telehealth claims for ten days, but without congressional action, practices may still face lost revenue.

Rural groups face additional pressure from the expiration of the 1.0 work GPCI floor. This policy ensured that physician work payments did not fall below a set minimum, protecting practices in lower-cost regions from steep reimbursement cuts. Without it, rural providers could see reductions that threaten already fragile financial stability.

In an October 2 letter to congressional leaders, the Medical Group Management Association (MGMA) urged lawmakers to act quickly to restore both provisions. The letter emphasized that the expiration has “thrown medical group operations into turmoil” and that failure to act could “undermine investments in telehealth and disrupt Medicare beneficiaries’ access to car."

MGMA leaders, speaking at a national conference last week, warned that the shutdown is not just a political crisis but a direct threat to patient access and practice operations. They called on Congress to reinstate the policies retroactive to September 30 and work toward a permanent solution to guarantee stability for both providers and patients.

Beyond telehealth and GPCI, the shutdown also threatens broader areas of health care, from Medicaid funding to clinical research support. Agency furloughs may delay rulemaking, oversight, and grants, creating ripple effects across the system.

For practices, the immediate focus remains on continuity of care. Administrators are bracing for financial strain, while patients — particularly seniors and those with chronic conditions — risk losing access to the virtual care they have come to rely on.

MGMA’s message is clear: without swift congressional action, both urban and rural practices face avoidable instability at a time when the health care system can least afford it.