Update on Processing of Medicare Claims Impacted During the Government Shutdown 

Multiple expiring Medicare statutory payment provisions lapsed on October 1, 2025, due to the absence of Congressional action. With the passage of the Continuing Appropriations, Agriculture, Legislative Branch, Military Construction and Veterans Affairs, and Extensions Act, 2026 (Pub. L. 119-37), Congress retroactively restored many of these payment provisions, effective from October 1, 2025, through January 30, 2026. This includes retroactively restoring the suspension of statutory provisions that restrict payment for telehealth services provided to beneficiaries in their homes and outside of rural areas. 

During the shutdown, in general, the Medicare Administrative Contractors (MACs) processed claims consistent with the price, software, fee, and payment schedules available on cms.gov. CMS has instructed the MACs to perform mass adjustments to any paid claims that are inconsistent with the most recent Congressional action, including a payment adjustment for low volume inpatient hospitals and a payment adjustment for the Medicare-dependent hospital program. 

On November 6, 2025, CMS instructed the MACs (see Update on Processing of Telehealth and Acute Hospital Care at Home Claims) to return a subset of telehealth claims submitted on or before November 10, 2025, that, at that time, were no longer payable because the statutory provisions temporarily suspending various Medicare telehealth requirements expired on October 1, 2025, or were claims CMS could not identify as payable under current law. For professional claims, those claims were returned with the following messages: CARC 16 and RARC M77. These claims are now payable, provided they meet all applicable Medicare requirements. Practitioners may resubmit those returned claims to CMS, as well as submit any other telehealth claims held in anticipation of possible Congressional action. Practitioners are also encouraged to identify which beneficiaries were charged for telehealth services with dates of service on or after October 1, 2025, that are retroactively payable and instead submit applicable claims to Medicare, refunding any overpayment to beneficiaries. Our instruction to practitioners to append the GY modifier on certain telehealth claims is rescinded and providers may resubmit previously denied claims. 

Similarly, beginning on November 10, 2025, CMS instructed the MACs to return claims for the Acute Hospital Care at Home initiative for dates of service of October 1, 2025, or later. Hospitals may resubmit those claims to CMS. 

Facilities, practitioners, and suppliers should be observing a return to normal processing operations over the coming days across the MACs and do not need to contact the MACs unless you observe specific discrepancies.