Senate approves stopgap funding bill, but broader healthcare reforms stall

The U.S. Senate recently approved a full-year continuing resolution (CR) to fund the government through September 30, 2025. This stopgap measure, which awaits President Donald Trump’s signature, prevents an immediate government shutdown and extends funding for several healthcare programs. Key provisions include maintaining Medicare telehealth services, rural hospital funding, and diabetes prevention programs—all of which were set to expire soon.

However, a more comprehensive bipartisan healthcare package failed to advance due to opposition from Senate Republicans. The stalled legislation, introduced by Senators Ron Wyden (D-Oregon) and Bernie Sanders (I-Vermont), aimed to address long-standing healthcare issues, including Medicare physician pay cuts, pharmacy benefit manager (PBM) reform, and opioid crisis funding.

The rejection of this broader package leaves significant gaps in healthcare policy, raising concerns about the financial stability of providers and access to care for vulnerable populations.

Short-term relief for healthcare programs

While the broader reforms were blocked, the continuing resolution ensures that certain crucial healthcare programs will continue receiving funding. These include the following.

Community health centers: These federally funded clinics serve millions of low-income patients, providing essential services ranging from primary care to mental health treatment.

National health service corps: A program that helps place medical professionals in underserved areas.

Teaching health center graduate medical education program: A program supporting physician training in community-based settings.

Special diabetes program: A critical initiative funding type 1 diabetes research and prevention.

Without this funding extension, millions of Americans could have faced disruptions in essential healthcare services. However, these programs are now only secure through September 30, 2025, meaning Congress must revisit their funding in the near future.

Medicare telehealth services extended

One of the most significant victories in the continuing resolution is the temporary extension of Medicare telehealth services. Telehealth became a crucial part of healthcare during the COVID-19 pandemic, particularly for rural communities with limited access to in-person care. The legislation ensures that Medicare’s geographic restrictions on telehealth services remain lifted, allowing more patients to receive virtual care regardless of location.

It also permits Federally Qualified Health Centers (FQHCs) and Rural Health Clinics (RHCs) to continue offering telehealth services, expanding access for underserved populations. Additionally, the bill delays the requirement for an in-person mental health visit before telehealth treatment, making it easier for patients to receive the care they need.

However, these extensions last only six months, meaning they will expire on September 30, 2025. Senate Democrats had pushed for a longer, two-year extension, arguing that a short-term renewal creates uncertainty for providers. Additionally, their proposal included a private insurance telehealth provision allowing high-deductible health plan enrollees to access pre-deductible telehealth services. That measure was not included in the final bill, leaving a gap in virtual care access.

Support for rural hospitals and ambulance services

The CR also extends financial support for rural hospitals, which face ongoing financial strain due to low patient volumes and high operational costs. Among the provisions are the following.

Medicare-dependent hospital support: These hospitals serve a disproportionate number of Medicare patients and require additional funding to stay operational.

Low-volume hospital payment extensions: Ensures continued funding for hospitals that do not see high patient traffic but are essential to local healthcare infrastructure.

Ambulance service reimbursement extensions: Medicare reimbursements for ground ambulance services will continue, preventing disruptions in emergency transportation services.

While these provisions provide temporary relief, they do not address the long-term financial instability that many rural hospitals face. The failed Bipartisan Healthcare Act had included stronger measures to stabilize these facilities, but with its rejection, rural healthcare providers continue to struggle.

Failed healthcare package leaves issues unresolved

Despite bipartisan support for several of its provisions, the Bipartisan Healthcare Act failed to move forward after Senator Rick Scott (R-Florida) objected to the bill without providing a detailed explanation. The proposed package sought to address Medicare reimbursement rates, pharmacy benefit manager (PBM) reform, Medicaid expansion, and opioid crisis funding—all critical issues affecting American healthcare.

Medicare physician pay fix blocked

One of the most controversial aspects of the bill was its attempt to reverse Medicare physician pay cuts. Currently, physicians face a 2.83% cut in their Medicare Physician Fee Schedule (PFS) payments, which took effect in January.

The proposed bill aimed to counteract this reduction by increasing Medicare payments by 3.5% through 2026 to stabilize physician reimbursement and extending a 3.5% payment boost for the Advanced Alternative Payment Model (AAPM) through the end of 2025.

Without these adjustments, physicians participating in Medicare may struggle financially, forcing some to limit the number of Medicare patients they see—or drop out of the program entirely. This could reduce patient access to care, particularly for elderly and low-income individuals who depend on Medicare coverage.

Pharmacy Benefit Manager (PBM) reform stalls

The failed legislation included PBM reform to address high drug costs. It aimed to eliminate spread pricing in Medicaid, enforce stricter contract regulations, and prevent PBMs from tying compensation to drug prices, ensuring fairer pricing for insurers and pharmacies.

Had this reform passed, it would have lowered prescription drug costs for many Americans. Instead, PBMs will continue operating under existing regulations, frustrating lawmakers and healthcare advocates who have long called for increased transparency.

Medicaid expansion & opioid response uncertain

Beyond Medicare payment issues and PBM reform, the failed bill also contained provisions for Medicaid expansion and increased opioid crisis funding—two areas of critical need.

Medicaid reforms delayed

The proposed bill aimed to improve Medicaid and CHIP enrollment by making it easier for out-of-state providers to participate. It also sought to remove age restrictions on Medicaid eligibility for working seniors with disabilities, ensuring they could continue to receive necessary healthcare.

Additionally, the bill aimed to expand coverage for community-based services, benefiting elderly and disabled individuals who rely on these resources for daily care. Another key provision required states to study the cost of maternity and delivery services in rural hospitals to address maternal health disparities. With the bill’s failure, Medicaid recipients and healthcare providers remain uncertain about coverage and access to essential services.

Opioid crisis response stagnates

The bill also aimed to reauthorize the SUPPORT Act for five years, providing funding to combat the opioid crisis. It included additional grants for community health centers treating addiction, increased support for opioid treatment programs nationwide, and funding for the World Trade Center Health Program, which provides care for 9/11 first responders and survivors.

Without these provisions, communities hit hardest by the opioid epidemic may struggle to access essential treatment and prevention services.

Future of healthcare policy

With Congress now shifting its focus to the next government funding deadline in October, the fate of long-term healthcare reforms remains uncertain. While the continuing resolution prevents immediate disruptions, the lack of broader legislative action leaves many key issues unresolved.

Many provisions from the unsuccessful legislation had broad bipartisan support, increasing the likelihood that lawmakers will reintroduce them in separate bills. However, with Republican leaders prioritizing federal budget cuts—including an $880 billion reduction to Medicaid over 10 years—healthcare reforms may face continued resistance.

For patients and providers, the uncertainty surrounding healthcare policy creates significant challenges. Telehealth providers must now navigate a short-term extension, making it difficult to invest in new technology or expand services. Physicians facing Medicare pay cuts may reconsider their participation in the program, and rural hospitals remain financially vulnerable.

A temporary fix, but no long-term stability

While the Senate’s stopgap funding bill prevents an immediate healthcare crisis, it does not resolve systemic issues. The failure of the Bipartisan Healthcare Act highlights the ongoing political struggles in passing meaningful healthcare reforms. With the next funding deadline approaching, lawmakers must either compromise on long-term solutions or risk further instability in the healthcare system.