The federal government shut down at 12:01 a.m. Oct. 1 after lawmakers failed to reach a spending deal. 

The Senate rejected both a Republican proposal and Democratic proposal in the hours before the shutdown, NBC News reported Sept. 30 

Democrats had sought provisions to extend ACA enhanced premium tax credits set to expire at the end of 2025, but Republican leaders preferred a proposal to keep the government open at current spending levels until Nov. 21, according to the report. Republican leaders said they’ll negotiate spending policy through regular federal funding processes, but their Democratic counterparts vowed to oppose any bill that failed to include their priorities.   

Here’s what healthcare leaders should know:

Hospital-at-home, telemedicine lapses

While most Medicaid and Medicare services will continue during the shutdown, lawmakers’ inability to reach a deal before midnight affected telehealth and hospital-at-home services.

Lawmakers’ inability to strike a funding deal before the Oct. 1 deadline meant that CMS’ hospital-at-home waiver expired. Some leaders told Becker’s in September that if funding lapsed, they would have to end their programs and send home-based patients back to the hospital. The care model allows patients to receive hospital-level care via in-home technology and medical equipment and in-person and virtual visits with clinicians. 

“We are on pins and needles for every one of these government shutdown deadlines,” said Michael Nassif, MD, medical director of Kansas City, Mo.-based Saint Luke’s Hospital In Your Home. “Because literally, at 11:59 p.m., if there’s no agreement, we have plan B to return people to the brick-and-mortar hospital.”

Medicare coverage for telehealth visits was extended several times over the past five years, but lapses without the passage of a spending bill.

Kyle Zebley, executive director of the advocacy arm of the American Telemedicine Association, told Congress in a Sept. 23 letter that the lapse could cause major disruptions for acute hospital care at home programs. 

“We will basically revert back to pre-pandemic restrictions, severely limiting access to urgently needed telehealth services,” he said. “Hospitals and clinicians will struggle to sustain telehealth-based care if reimbursement disappears. It’s untenable.”  

Mr. Zebley said lawmakers should “at least give providers some reassurance that they will receive back payment for essential healthcare services delivered during this shutdown.”

HHS furloughs 

HHS will furlough 41% of its workforce during the shutdown, according to the contingency plan it released Sept. 29. In total, 32,460 of the department’s 79,717 will be furloughed. 

The department said it will use its authority under the Anti-Deficiency Act to maintain department activities during the shutdown.

“Over the duration of any lapse, HHS will continue to review its resources, authorities and flexibilities under the law to minimize the impact of such a lapse on the safety of human life and the protection of property,” the department said. “HHS will rely on exceptions in the ADA to continue to protect human life and property, such as monitoring for disease outbreaks conducted by the Centers for Disease Control and Prevention.” 

HHS will also use exceptions under the act to retain staff in support funded-activities such as Medicare, Medicaid and other mandatory health program payments.

However, the department will cease all non-exempt and non-excepted activities in the event of a shutdown. This includes oversight of extramural research contracts and grants, data collection, validation and analysis. 

“More specifically, CDC communication to the American public about health-related information will be hampered, CMS will be unable to provide oversight to major contractors, and (National Institutes of Health) will not have the ability to admit new patients to the Clinical Center, except for whom it is medically necessary,” HHS said in the plan. 

Under the plan, 53% of CMS’ staff would be retained. The plan also calls for 86% of Food and Drug Administration employees to be retained, as well as 36% of CDC staff and 24.5% of NIH staff.

Some job losses could be permanent 

In the days leading up to the shutdown, the White House directed federal agencies to prepare mass layoff plans. 

A Sept. 23 memo from the Office of Management and Budget instructed agencies to update their “lapse plans” and prepare for possible workforce cuts and furloughs if funding expired. 

Agencies were told to identify programs that meet three criteria: 

Discretionary funding expires Oct. 1.

No other source of funding, such as H.R.1, is available.

The program is not consistent with President Donald Trump’s priorities.

On Sept. 30, the American Federation of Government Employees and the American Federation of State, County and Municipal Employees filed a lawsuit challenging the threats of possible mass firing. 

The unions’ lawsuit argues that the administration’s plan to fire federal employees during a shutdown is an unlawful abuse of power designed to punish workers and pressure Congress. The unions are asking the court to declare that the Office of Management and Budget exceeded its authority in ordering the shutdown firings and to invalidate any actions agencies take pursuant to the order.

What’s next? 

House lawmakers aren’t expected to return to Washington, D.C., until next week, The Wall Street Journal reported Oct. 1. Any funding proposal would need their approval. 

Unlike the 2019 government shutdown that lasted 34 days, Congress has not passed any appropriations bills, so no government offices have been funded.