Telehealth coverage dramatically transformed our healthcare landscape when the pandemic hit — jumping from a mere 6.9% of Medicare beneficiaries using it pre-COVID to a staggering 46.7% by mid-2020. I’ve watched this revolution unfold firsthand, and while usage has settled to 12.7% in late 2023, it’s still nearly double the pre-pandemic levels.
But here’s what keeps me up at night: many of these telehealth flexibilities are temporary and set to expire on September 30, 2025. If you’re relying on Medicare telehealth services, you probably haven’t been told the full story about what’s changing. The disparities are already concerning — 27% of urban beneficiaries use telehealth compared to just 19% of rural ones, despite the technology’s promise to bridge geographic gaps.
In this article, I’ll break down everything you need to know about Medicare telehealth coverage in 2025 — no complicated jargon, no insurance doublespeak. Just clear facts about what’s covered, what’s ending, and what it means for your healthcare access. Everyone deserves straightforward information about their coverage, especially when $2.4 billion in healthcare spending hangs in the balance.
How telehealth coverage evolved since COVID-19
“Originally introduced during the COVID-19 pandemic, these policies have revolutionized care delivery, especially in rural and underserved areas, by removing barriers to access and expanding provider reach.” — American Gastroenterological Association, Professional medical society representing gastroenterologists and hepatologists
Before 2020, telehealth was barely a blip on the healthcare radar. Now, it’s a cornerstone of modern medicine. Let’s trace this remarkable transformation and understand what it means for your coverage.
The pre-2020 limitations on telehealth
Medicare’s telehealth coverage before the pandemic was severely restricted. The program only paid for telehealth services for patients in designated rural areas who had difficulty accessing medical facilities. Additionally, patients couldn’t receive care at home—they had to travel to approved clinical sites to connect with remote providers.
These pre-pandemic restrictions created significant barriers:
- Only certain licensed providers could bill for telehealth services
- Providers needed to use fully HIPAA-compliant platforms, requiring costly technology investments
- Medicare limited reimbursement to specific services using real-time, two-way video communication
- Interstate licensure issues prevented doctors from treating patients across state lines
Despite these hurdles, approximately 76% of US hospital systems used some form of telemedicine by 2018, with radiology, psychiatry, and cardiology as the highest users. Nevertheless, the actual integration remained low because of complex logistics and inadequate reimbursement.
Pandemic-driven policy changes
In March 2020, everything changed. Congress passed historic legislation that dramatically transformed telehealth coverage. The Centers for Medicare and Medicaid Services (CMS) implemented sweeping changes through emergency waivers that:
- Removed geographic restrictions, allowing telehealth from any location
- Permitted patients to receive care from their homes
- Expanded eligible provider types, including FQHCs and RHCs
- Allowed audio-only services when video wasn’t possible
- Added more than 120 services to the telehealth coverage list
- Provided payment parity between telehealth and in-person visits
- Relaxed HIPAA requirements to allow platforms like FaceTime and Skype
The response was extraordinary. Telehealth encounters increased by 766% in the first three months of the pandemic, jumping from 0.3% of all interactions to 23.6% during the same period the previous year. Furthermore, according to claims data, the overall percentage of telehealth claims ballooned from 0.1% in 2019 to around 5% by late 2021.
Temporary vs. permanent changes
Now in 2025, we’re at a critical juncture. Recent legislation authorized the extension of many Medicare telehealth flexibilities until September 30, 2025. However, not all changes will remain in place.
What’s becoming permanent:
- Removal of geographic restrictions for behavioral/mental health telehealth
- Patients can permanently receive behavioral health care in their homes
- Audio-only options for behavioral health services
- FQHCs and RHCs can permanently serve as Medicare distant site providers for behavioral health
What’s temporary (expiring September 30, 2025):
- Medicare coverage for non-behavioral telehealth services at home
- Removal of geographic restrictions for general medical telehealth
- Expanded provider eligibility for non-behavioral services
- FQHCs and RHCs as distant site providers for non-behavioral services
At the state level, the picture varies considerably. By the end of 2022, 37 states had enacted legislation to make pandemic telehealth policies permanent. At least 27 states made permanent reimbursement of Medicaid coverage and private insurance for telehealth, and 29 states permanently authorized reimbursement for audio-only consultations.
In contrast to enthusiastic predictions from 2020-2021, the telehealth market now faces an uncertain future. Most policy experts anticipate another short-term extension, though permanently codifying these policies raises concerns about the $2 billion in excess Medicare spending the Congressional Budget Office has estimated.
What Medicare covers under telehealth in 2025
Medicare’s telehealth coverage in 2025 operates under a complex mix of permanent and temporary policies. As a Medicare beneficiary, understanding these nuances is essential for accessing care without unexpected barriers or costs.
Behavioral health services
Behavioral health services have secured the most permanent telehealth protections in Medicare. For instance, geographic and originating site restrictions have been permanently removed for any telehealth service used to diagnose, evaluate, or treat mental health disorders. This means all Medicare beneficiaries can receive behavioral health telehealth services regardless of where they live.
The in-person visit requirements for these services have also been delayed. The American Relief Act of 2025 pushed back the requirement for an initial in-person visit until April 1, 2025. For Federally Qualified Health Centers (FQHCs) and Rural Health Clinics (RHCs), this requirement has been delayed even further—until January 1, 2026.
Notably, the list of eligible providers for behavioral telehealth has expanded. Marriage and family therapists can now permanently serve as Medicare distant site providers for these services. This expansion significantly increases access to mental health professionals through telehealth.
Audio-only consultations
Prior to recent changes, Medicare required all telehealth services to use two-way audio/video connections. In 2025, the rules have evolved considerably. CMS has permanently changed the definition of “interactive telecommunications system” to include audio-only technology for telehealth services when:
- The patient is in their home
- The provider has video capability
- The patient cannot use or does not consent to video
For behavioral health services specifically, audio-only delivery is permanently allowed. In contrast, non-behavioral telehealth services can be delivered via audio-only platforms only through March 31, 2025. After this date, audio-only options become more limited for general medical care.
The billing approach has also changed. Medicare eliminated codes 99441-99443 for 2025, replacing them with standard evaluation and management codes (99202-99215) with specific modifiers to indicate audio-only delivery.
Home-based care eligibility
Through September 30, 2025, Medicare beneficiaries can receive telehealth services at any location in the United States, including their homes. This temporary flexibility has been crucial for maintaining care access.
Starting October 1, 2025, however, most beneficiaries must be in a medical facility located in a rural area for telehealth services. The primary exception: services for diagnosis, evaluation, or treatment of mental and behavioral health disorders can still be received at home after this date.
Medicare Advantage plans may offer more generous telehealth benefits than Original Medicare. As a result, those with Medicare Advantage might retain broader home-based telehealth access after September 2025.
FQHCs and RHCs as distant site providers
Federally Qualified Health Centers and Rural Health Clinics have gained significant telehealth capabilities. They can now permanently serve as Medicare distant site providers for behavioral health telehealth services. This represents a major shift from pre-pandemic policies when these safety-net providers had limited telehealth options.
For non-behavioral health services, FQHCs and RHCs can serve as distant site providers only through September 30, 2025. Essentially, their broader telehealth authority remains temporary for general medical care.
The payment structure varies by service type. Behavioral health services furnished by RHCs and FQHCs via telehealth are paid under their standard All Inclusive Rate (AIR) and Prospective Payment System (PPS) respectively. In contrast, for non-behavioral health telehealth services through December 31, 2025, payment rates are subject to the national average for comparable services under the physician fee schedule.
Who benefits most from Medicare telehealth
The telehealth explosion wasn’t equally beneficial for all Medicare beneficiaries. As we enter 2025, clear patterns have emerged showing which groups rely most heavily on virtual care options.
Urban vs. rural disparities
Contrary to initial expectations that telehealth would primarily benefit rural communities, urban Medicare beneficiaries consistently show higher utilization rates. Currently, 27% of urban beneficiaries use telehealth compared to only 19% of rural residents. This gap persists despite efforts to expand rural access.
The digital divide explains much of this disparity. Rural areas often lack reliable broadband infrastructure necessary for video visits. In fact, states with the highest telehealth adoption during COVID had 3-5% higher household internet subscription rates than low-adoption states.
Interestingly, the pattern reversed during the pandemic. Before COVID, rural telehealth usage exceeded urban due to Medicare’s geographic restrictions. Once those restrictions were temporarily lifted, urban usage surpassed rural.
Racial and ethnic usage trends
Telehealth adoption varies considerably across racial and ethnic groups. Recent data shows Asian/Pacific Islander (31%) and Hispanic (30%) beneficiaries lead in telehealth utilization, followed by Black (26%) and non-Hispanic White beneficiaries (24%).
Yet technological barriers remain substantial. Black (28%) and Hispanic (30%) beneficiaries report significantly higher rates of no access to required telehealth technologies compared to White beneficiaries (14%).
Among those with technology access, audio-only visits show clear disparities. Hispanic beneficiaries face the highest rates of audio-only telehealth offers (52.9%), followed by Black (41.2%) and White beneficiaries (32.0%). Subsequently, Hispanic and non-primary English speakers may struggle with video platforms.
Dual-eligible and low-income beneficiaries
Dual-eligible individuals—those qualifying for both Medicare and Medicaid—demonstrate particularly high telehealth utilization at 34% compared to 23% for non-Medicaid-eligible beneficiaries. This makes sense given that dual-eligibles represent a particularly vulnerable population where telehealth offers substantial benefits.
Consider the demographics: dual-eligibles account for only 19% of Medicare recipients yet generate 34% of Medicare spending. Moreover, half experience difficulty with at least one daily living activity, and 60% manage multiple chronic conditions.
Nevertheless, dual-eligibles faced greater care disruptions during the pandemic. Although their telehealth usage was higher (6.3% vs 5.0% for Medicare-only), they experienced larger decreases in overall healthcare utilization (-12.1% versus -11.2%).
People with disabilities or chronic conditions
Telehealth delivers particular value for those with functional limitations. Beneficiaries qualifying for Medicare based on end-stage renal disease or disability both show significantly higher telehealth utilization (37%) compared to age-qualified beneficiaries (23%).
For individuals with mobility challenges, telehealth eliminates transportation barriers that often lead to missed appointments. AARP reports telehealth is “most popular among people 65 and older with long-term disabilities”.
Rural beneficiaries with chronic conditions show significantly higher telehealth usage rates and greater likelihood of utilizing phone and video telehealth. Meanwhile, remote monitoring technologies enable providers to track vital signs and medication adherence in real-time for those with diabetes, hypertension, or heart disease.
How Medicare pays for telehealth services
“In the 2025 MPFS final rule, CMS amended its regulations to provide payment to RHCs and FQHCs for medical telehealth services at the national average payment rates for comparable services under the MPFS.” — PYA (Pershing Yoakley & Associates), National healthcare consulting firm
Understanding the financial mechanics behind Medicare telehealth is crucial as we approach critical policy deadlines. Medicare’s payment structure for telehealth has evolved dramatically since 2020, creating a complex system with important distinctions.
Payment parity vs. facility rate
Medicare currently pays providers for telehealth services at the same rate they would receive for in-person care. This “payment parity” approach represents a significant change from pre-pandemic policies.
Historically, Medicare paid for all telehealth services at the lower “facility rate” regardless of where the provider delivered care. Starting January 2024, this changed permanently for certain services. Telehealth services provided to patients in their homes now receive the higher “non-facility” payment rate. For behavioral health specifically, payment parity between in-person and telehealth services became permanent through the Consolidated Appropriations Act of 2021.
Providers must use specific Place of Service codes: POS 10 for patients at home (higher non-facility rate) and POS 02 for all other locations (lower facility rate).
Differences between traditional Medicare and Medicare Advantage
While Traditional Medicare follows strict telehealth payment rules, Medicare Advantage plans offer greater flexibility. These plans must cover all telehealth services available under Traditional Medicare but can include additional telehealth benefits not routinely covered.
Since 2020, Medicare Advantage plans have been permitted to include telehealth costs in their basic Medicare Part A and B benefit package and may continue offering these benefits even after telehealth expansions in Traditional Medicare expire. This creates potential disparities in telehealth access between beneficiaries in different programs.
CMS telehealth reimbursement rules
For standard Medicare telehealth, beneficiaries pay 20% of the Medicare-approved amount after meeting the Part B deductible. Providers bill using appropriate CPT or HCPCS codes, with specific modifiers indicating audio-only delivery when applicable.
FQHCs and RHCs operate under different rules. For behavioral health services, they receive payment under their standard All-Inclusive Rate or Prospective Payment System respectively. For non-behavioral telehealth through March 31, 2025, they bill using HCPCS code G2025 and receive payment based on the average Medicare telehealth rate.
The telehealth originating site facility fee (HCPCS Q3014) is $31.04 for 2025 services, reflecting a 3.6% MEI increase from 2024.
What’s changing in 2025 and what’s at risk
The clock is ticking on several key Medicare telehealth provisions as we approach critical deadlines in 2025. With so many temporary measures set to expire, both patients and providers face uncertainty about the future of virtual care.
Medicare telehealth end date and pending legislation
Most Medicare telehealth flexibilities are scheduled to end on September 30, 2025. After this date, beneficiaries will generally need to be located in rural areas and at qualifying medical facilities to access telehealth—with behavioral health services being the primary exception.
Several bills before Congress aim to extend or make permanent these flexibilities:
- The Telehealth Modernization Act would permanently remove geographic restrictions and add homes as eligible originating sites
- The CONNECT for Health Act would provide the HHS Secretary authority to waive telehealth restrictions
- The Telehealth Extension Act focuses on extending audio-only provisions beyond 2025
Licensure and cross-state practice rules
State-based licensing requirements remain one of telehealth’s most significant barriers. Currently, most providers must be licensed in the patient’s state of residence to deliver telehealth services.
The Interstate Medical Licensure Compact, now operating in 39 states, offers an expedited pathway for physicians to practice across state lines. Yet, this still requires obtaining individual state licenses, albeit through a streamlined process.
Concerns about fraud and overuse
The Office of Inspector General has identified telehealth as a high-risk area for Medicare fraud. Consequently, CMS has implemented stricter monitoring and auditing practices for telehealth claims.
Primary concerns include:
- Billing for services never rendered
- Upcoding telehealth visits to higher intensity levels
- Unnecessary prescribing through telehealth platforms
Impact on Medicare spending
Telehealth’s expansion has financial implications for Medicare. The Congressional Budget Office estimates telehealth flexibility extensions would cost approximately $2.4 billion over the next decade.
Ultimately, policymakers face a challenge balancing expanded access against financial sustainability. Research shows mixed results on whether telehealth reduces overall healthcare spending—some studies indicate cost savings through reduced emergency visits, whereas others suggest increased utilization may offset these savings.
Conclusion
As we approach the September 2025 deadline, telehealth stands at a critical crossroads. Throughout this examination of Medicare telehealth policies, one fact remains undeniably clear: the temporary nature of many flexibilities creates significant uncertainty for millions of beneficiaries.
Certainly, behavioral health services have secured more permanent protections, though most general medical telehealth provisions will vanish without congressional action. This looming expiration threatens to reverse hard-won progress, particularly for vulnerable populations like dual-eligible beneficiaries and those with disabilities who rely heavily on virtual care.
Though Medicare Advantage plans might maintain broader telehealth coverage beyond 2025, this creates a troubling two-tier system. Additionally, persistent disparities between urban and rural usage highlight how technological barriers continue to undermine telehealth’s promise of equitable access.
The financial implications cannot be overlooked, either. While the Congressional Budget Office estimates extending telehealth flexibilities would cost $2.4 billion over a decade, this figure fails to capture potential savings from preventive care, reduced hospitalizations, and greater healthcare efficiency.
Policymakers face difficult decisions about telehealth’s future. However, the evidence strongly suggests telehealth has fundamentally transformed how millions access healthcare. Rather than reverting to pre-pandemic restrictions, we need thoughtful, permanent policies that preserve access while addressing legitimate concerns about costs, fraud, and licensure issues.
The next few months will determine whether telehealth remains a cornerstone of modern healthcare or becomes another pandemic-era adaptation left behind. Medicare beneficiaries deserve clarity and continuity in their care options, regardless of where they live or which Medicare program they choose.
FAQs
Q1. Will Medicare telehealth services continue after September 2025? Most Medicare telehealth flexibilities are set to expire on September 30, 2025. After this date, telehealth access may be limited to rural areas and specific medical facilities, with behavioral health services being the main exception. However, several bills in Congress aim to extend or make these flexibilities permanent.
Q2. How does telehealth coverage differ between urban and rural Medicare beneficiaries? Despite initial expectations, urban Medicare beneficiaries use telehealth at higher rates (27%) compared to rural beneficiaries (19%). This disparity is largely due to better broadband infrastructure in urban areas, which is necessary for video visits.
Q3. Are audio-only telehealth consultations covered by Medicare? Yes, Medicare covers audio-only telehealth consultations in certain situations. For behavioral health services, audio-only delivery is permanently allowed. For non-behavioral services, audio-only options are available through March 31, 2025, when the patient is at home and unable or unwilling to use video.
Q4. How does Medicare pay for telehealth services? Medicare currently pays providers for most telehealth services at the same rate as in-person care, known as “payment parity.” For services provided to patients at home, providers receive a higher “non-facility” payment rate. Beneficiaries typically pay 20% of the Medicare-approved amount after meeting their Part B deductible.
Q5. Who benefits most from Medicare telehealth services? Telehealth has been particularly beneficial for dual-eligible beneficiaries (those qualifying for both Medicare and Medicaid), people with disabilities or chronic conditions, and certain racial and ethnic groups. For instance, 34% of dual-eligible individuals use telehealth compared to 23% of non-Medicaid-eligible beneficiaries.
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