US Funding Bill Extends Telehealth Flexibilities and Enacts PBM Reform

President Trump has signed into law a federal funding bill that ended a short-term partial government shutdown, funded the Department of Health and Human Services, extended key telehealth and virtual care policies, and enacted long-debated pharmacy benefit manager reforms. The so-called minibus package was approved after the Senate voted 71–29 on Jan. 29 and the House passed the measure 217–214 on Feb. 3.

The legislation did not reinstate enhanced Affordable Care Act premium tax credits that expired at the end of 2025, nor did it include provisions from the administration’s healthcare plan to direct funds into consumer health savings accounts. A major point of contention during negotiations was Democratic opposition to funding the Department of Homeland Security, which ultimately received only a two-week extension under the bill.

Central to the healthcare provisions is a two-year extension of Medicare telehealth flexibilities, which are now authorized through Dec. 31, 2027. These policies, first introduced during the COVID-19 pandemic, have allowed broader use of virtual care services and have received sustained support from provider groups and telehealth advocates. The bill also includes a five-year extension of the Acute Hospital Care at Home waiver, now running through Sept. 30, 2030, and extends in-home cardiopulmonary rehabilitation flexibilities through Jan. 1, 2028.

“This is a significant and hard-earned win for ATA Action, the ATA and our members, as well as for patients, caregivers, clinicians and healthcare organizations, demonstrating the strength of sustained, credible, strategic advocacy,” said Kyle Zebley, CEO of the American Telemedicine Association and executive director of ATA Action. He added, “We are deeply grateful for the continued bipartisan, bicameral backing of our congressional champions, holding steady on their support for telehealth and virtual care services.”

The legislation also requires HHS to issue guidance within one year on providing telehealth services to individuals with limited English proficiency. Alexis Apple, deputy executive director of ATA Action, said, “These multiyear extensions will give government agencies, legislators and advocates needed time to hammer out the details of permanent provisions.”

In addition to telehealth, the bill advances bipartisan prescription drug pricing reforms through a provision known as Q1/Q2. The measure separates PBM revenue from drug prices in Medicare Part D, requires PBMs to pass 100% of rebates to Medicare plans, and mandates greater pricing transparency. “Strengthening competition and increasing transparency are key to lowering prescription drug prices,” said Merith Basey, CEO of Patients For Affordable Drugs Now.

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