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This article was updated on November 6, 2025, with an additional statement from Chris Adamec, the executive director of the Alliance for Connected Care.
Since 2020, a temporary policy has allowed Medicare-enrolled practitioners to bill for telehealth services provided from their home after hours and other alternative locations using their existing practice locations.
With the new 2026 Medicare Physician Fee Schedule Final Rule published this past Friday, effective in January 2026, the Centers for Medicare and Medicaid Services will now require these practitioners to separately enroll and bill for each location from which they deliver telehealth.
Virtual care proponents said the additional documentation requirements will create an enormous administrative burden for providers and increase regulatory complexity – for both practitioners and CMS, which could cost health systems millions.
But while CMS will end the temporary policy allowing practitioners to bill for telehealth from their homes using their practice location, the fee schedule does include several positive steps for telehealth permanence, according to the American Telemedicine Association and the American Medical Association.
WHY IT MATTERS
The Alliance for Connected Care expressed its strong disappointment with CMS' decision not to renew the telehealth billing policy in the final CY2026 Physician Fee Schedule.
"In a survey of Alliance members, it was estimated that this change will result in up to a fortyfold increase in the number of billing addresses tracked and reported to CMS by a health system," Alliance members said in a statement on Monday. "Multiple health systems estimated the resulting operational costs of this change at approximately $1 million in labor."
The Alliance said the decision opposes CMS' stated goals of streamlining healthcare regulatory burdens and will severely limit the availability of after-hours and continuous telehealth care for Medicare patients.
"Ending this telehealth billing flexibility will make it harder, not easier, for clinicians to care for their patients," Adamec added by email on Thursday. "By reinstating outdated location rules, CMS is effectively reducing access to continuous care, such as after-hours telehealth visits, while dramatically increasing clinician administrative burdens and costs. This reversal undermines years of progress toward modern, patient-centered care and should be swiftly corrected."
On the other hand, the fact that CMS has continued its recognition of telehealth "as a vital component of care delivery" is just one of many positive steps included in the final fee schedule, said Kyle Zebley, senior VP for public policy at the American Telemedicine Association and executive director of ATA Action.
According to ATA on Monday, the rule's final provisions include:
- A permanent process for adding services to the Medicare Telehealth Services List by removing provisional versus permanent distinctions and focusing reviews on whether the service can be delivered via two-way interactive audio-video technology.
- Permanent adoption of a direct supervision definition allowing "immediate availability" via real-time audio/video communication (not audio-only) for certain services.
- Updated telehealth codes and coverage, including not deleting coverage for Health Risk Assessment.
- Removal of critical care consultation services and certain inpatient and nursing facility telehealth frequency limits.
- Expansion of codes to include U.S. Food and Drug Administration-cleared or de novo-authorized Digital Mental Health Therapeutic Devices for digital therapy to treat attention-deficit/hyperactivity disorder.
- Temporary allowance of Medicare Diabetes Prevention Program suppliers to be virtual only and not be required to maintain in-person delivery capability through Dec. 31, 2029, and establish a temporary online delivery period through 2029 to test asynchronous online delivery of MDPP services.
- Finalized allowance for remote patient monitoring and remote therapeutic monitoring billing when data is collected for 2 to 15 days in 30 days, up from a minimum of 16 days.
While positive steps include "expanded coverage, streamlined processes and permanent adoption of key flexibilities," ATA Action will continue to engage CMS on providers delivering care from home, Zebley said.
He noted, however, that ATA has ongoing concerns that the issue of provider location and home address reporting has not yet been fully resolved, a change that could significantly impact providers across the country when the current flexibility expires Dec. 31.
THE LARGER TREND
ATA has urged lawmakers for weeks to act to ensure virtual care access ahead of telehealth and hospital-at-home coverage under Medicare flexibilities ending Sept. 30 and remaining uncertain with the government shutdown.
Meanwhile, several provisions of the newly released 2026 physician fee schedule were welcomed by the American Medical Association for continued virtual care, while others caused concern.
CMS finalized proposals long advocated by the association to permanently lift limits on telehealth services provided to patients in hospitals and skilled nursing facilities and will continue to allow teaching physicians to provide virtual supervision to residents providing telehealth services in all training sites.
The final rule also allows for virtual direct supervision for most services that require supervision. Zebley noted that this "important provision" had not been included in the proposed rule and is further evidence of the agency's long-term support of virtual care delivery.
While physicians will get a 2.5% pay increase in the 2026 fee schedule, an "efficiency adjuster" of -2.5% would reduce total reimbursement to most specialties, and there's a reduction in physician payment rates for hospital or ambulatory surgical center services, AMA said.
Reduced payment for more than 7,000 physician services represents 95% of all services provided by physicians.
ON THE RECORD
"CMS is reinforcing primary care as the foundation of a better healthcare system while ensuring Medicare dollars support real value for patients, and not the kind of waste or abuse that erodes trust in the system," Chris Klomp, CMS deputy administrator and director of the Center for Medicare, said in a statement Friday.
"We strongly support efforts to streamline regulations, simplify documentation requirements, and modernize federal policies that no longer reflect how care is delivered in today's connected environment," Alliance for Connected Care members said in a statement. "This change is the antithesis of that vision and should be immediately corrected through subregulatory guidance."
Andrea Fox is senior editor of Healthcare IT News.
Email: afox@himss.org
Healthcare IT News is a HIMSS Media publication.
