The government shutdown began on October 1st, and it’s unclear how much longer it will continue. The effects are far-reaching—impacting everything from food assistance programs to the TSA—and, if the shutdown persists, they will likely get worse.

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Therapists are already feeling the pinch. Federal contractors may be the hardest hit, but the shutdown has also impacted therapists in private practice.

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Here are three ways the shutdown affects self-employed therapists, and steps you can take now to weather the storm.

Changes to the telehealth waiver affecting therapists

The COVID-era waiver on telehealth services allowed therapists to treat clients 100% remotely and bill Medicare or Medicaid. 

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This waiver was extended multiple times. The last extension was due to expire on September 30th unless Congress intervened. Partly due to the shutdown, the waiver did in fact expire.

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What does that mean for therapists? The rules have changed for treating patients via telehealth who have coverage from the Centers for Medicare & Medicaid Services (CMS).

How telehealth changed after October 1st, 2025

Many telehealth services are no longer covered by Medicare. But luckily for therapists, behavioral health services are less impacted than others. 

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Under the new rules, therapists can no longer treat clients 100% remotely and bill Medicare. You must meet minimum requirements for in-person treatment to continue billing for telehealth.

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Those requirements are:

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• For new clients: You must treat a new client in person no more than six months before beginning telehealth treatment.

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• For existing clients: If you already treat a client via telehealth, or if you begin treating a new client via telehealth, you are required to treat them in person at least once every 12 months.

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If you were already treating a client at the time of the October 1st deadline, you do not need to immediately book an in-person appointment with them. Provided you see them in person before 12 months have passed—that is, before October 1st, 2026—then you can continue filing claims.

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Exceptions to the new telehealth requirements

If a client has a medical condition that prevents them from seeing you in person, or if an in-person session would negatively affect their progress, you can opt not to treat them within the 12-month period and continue billing as normal.

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In that case, you must document your reasons for skipping the required visit. Those reasons must be supported by information in the client’s medical records.

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Also, if you run a group practice, you can meet the 12-month requirement by having another therapist at your practice, with an equivalent license and specialization, treat them in person.

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For an in-depth look at these exceptions, review the guidelines from the APA. 

How to adjust your practice to the new telehealth requirements

If you see clients 100% remotely, and some of those clients have Medicare coverage, you will need to make some changes to how your practice operates in order to comply with the new telehealth requirements.

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For a full list of guidelines, plus links to further reading, check out How the Government Shutdown Impacts Telehealth for Therapists. 

IRS delays affecting private practice

As a result of the shutdown, on October 8th the IRS put about half its workers on furlough. A significant number of them work for the Small Business/Self-Employed (SB/SE) division.

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Essential functions like online filing are still up and running, but because of reduced staffing some services are limited or even frozen. And, depending on how long the shutdown lasts, there could be an impact on IRS processes during tax season.

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Here’s what you need to know:

IRS deadlines still apply

Filing and payment deadlines have not changed. You should plan to file and pay your taxes on time to avoid penalties and interest.

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That also applies to remittance schedules for payroll and income tax if you have employees.

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Some important deadlines coming up or already passed:

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• Quarterly estimated payments (September 15th, 2025 for Q3 and January 15th, 2026 for Q4).
• Individual and sole proprietor returns (April 15th, 2026)
• Individual and sole proprietor extension requests (April 15th, 2026)
• S corp filing (March 16th, 2026)
• S corp extension returns (March 16th, 2026)
• Individual filing for 2024 with an extension (October 15th, 2025)
• S corp filing for 2024 with an extension (September 15th, 2025)

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If you don’t think you will be able to meet a tax deadline, the best move is to catch up on bookkeeping and, if necessary, file for an extension.

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IRS help with complex cases may be delayed

Most US Tax Court proceedings have paused. If you were expecting a resolution in court, you should anticipate a significant delay.

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If you were receiving IRS support for financial hardship or for help resolving procedural issues, you should also expect delays; the National Taxpayer’s Advocate office has reduced operations.

Personal support is limited

The IRS automated phone system is running as usual, but with a limited number of staff. If you call the IRS, you will likely be unable to speak to a representative.

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Any forms or payments you submit by mail will continue to be processed and deposited. But the IRS is not currently responding to new correspondence.

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If you have already been in correspondence with the IRS—for instance, due to an audit or an IRS request for additional documentation—you are still required to respond to any requests in a timely manner. Keep mail slips for all outgoing correspondence, in case you later need to prove that you mailed a document on time.

Tax season may be affected

With no end to the shutdown in sight, it’s unclear how far-ranging the effects of reduced IRS operations will be.

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Low staffing can lead to work backlogs that affect IRS services later on down the line. For instance, your 2026 tax refund could be delayed. And you may have trouble getting personal support from the IRS during tax season.

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To keep current with changes that could affect your practice, follow the IRS tax updates page.

Preparing for tax season with the government shutdown

Some steps you can take in anticipation of a possible IRS slowdown this tax season:

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• File your tax return accurately and on time
• Avoid overpaying your taxes (due to the potential for refund delays)
• Don’t count on a timely refund
• Consider delaying complex tax moves
• Keep up with remittance schedules and quarterly payments

For more information, including details on each of these steps, check out How the Government Shutdown Impacts Tax Season for Therapists.

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Medicare claims payments delayed for therapists 

At the start of the shutdown, on October 1st, the CMS directed their Medicare Administrative Contractors to put a hold on claim payments usually made:

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• Under the Medicare Physician Fee Schedule (including therapy services)
• For ground ambulance transport
• To Federally Qualified Health Centers (FQHCs)

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Claims payments for telehealth services were also put on hold, including payments for behavioral health.

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On October 16th, the CMS lifted the hold, and claims are now being paid to providers. 

However, therapists who filed claims between the 1st and the 16th could feel the effects of the hold, with some payments delayed.

How to protect your practice from cash flow problems

The hold on claims payment was a source of anxiety for many therapists in private practice who treat clients with Medicare coverage. 

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When you run your own practice, you need to maintain steady revenue so you can pay for operating expenses as they occur. Cash flow problems can lead to missed bill payments, a delayed owner’s draw or salary, or overreliance on credit.

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To avoid cash flow problems in the future, consider:

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• Starting an emergency fund
• Opening a line of credit
• Building an adaptable budget

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For more on these strategies, check out How the Government Shutdown Impacts Medicare Reimbursements for Therapists.

Will claims payments be paused again?

No announcements have been made about future holds on payments, but to keep up to date with Medicare-related news, you can subscribe to the Medicare Learning Network newsletter.

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Key takeaways

• Telehealth rules have changed. In order to bill Medicare, you must now see new clients in person no more than six months before beginning remote treatment, and see existing clients in person at least once every 12 months.

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• IRS phone support is limited, new correspondence has been paused, and staffing shortages may lead to delays when tax season arrives.

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• By paying your taxes as accurately as possible—avoiding overpayments—you can make sure you aren’t left waiting if refunds are delayed in 2026.

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• Medicare claims payments were paused October 1st to October 16th, which may delay payments for therapists. 

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• You can protect against future cash flow shortages by setting up an emergency fund, opening a line of credit, and building a budget that adapts as your practice changes.

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This post is to be used for informational purposes only and does not constitute legal, business, or tax advice. Each person should consult their own attorney, business advisor, or tax advisor with respect to matters referenced in this post. 

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Bryce Warnes is a West Coast writer specializing in small business finances. 

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