Gov’t inches toward reopening, but key healthcare questions remain

After 41 days of a historic federal shutdown, Washington is inching toward reopening — but not yet. Over the weekend, the Senate advanced a short-term spending package that would fund most federal agencies through January 2026 and provide full-year appropriations for military construction, veterans’ affairs, agriculture, and the legislative branch.

The House still has to vote, and the president’s signature remains pending. Until then, the government isn’t officially back — a technicality that carries real consequences for the nation’s health sector.

The shutdown began when Congress failed to reach agreement on the federal budget, largely over the Affordable Care Act’s premium tax credits. The enhanced subsidies — expanded during the pandemic — were set to expire without new legislation, igniting one of the fiercest fights over healthcare funding in years.

Essential programs like Medicare and Medicaid kept running, but agencies that depend on discretionary funding took heavy hits. At the Centers for Medicare & Medicaid Services, nearly half of employees — roughly 3,000 people — were furloughed, delaying claims and reimbursements. Later, CMS recalled its staff to manage open enrollment, using marketplace user fees to cover payroll.

Elsewhere, the Food and Drug Administration postponed inspections and slowed product reviews. The National Institutes of Health curtailed new grants. The CDC cut back on outbreak surveillance. Hospitals and biotech firms relying on federal research partnerships saw timelines grind to a halt.

A deal in motion, but healthcare’s still on hold

The Senate’s 60–40 vote to advance the funding bill broke weeks of gridlock. The proposal would keep most agencies open into the new year and restore back pay for furloughed workers. It also reverses Trump-era layoffs carried out during the shutdown and shields federal employees from additional cuts through January 30.

But health-policy flashpoints remain unresolved. The deal doesn’t extend ACA subsidies — a key demand from Democrats and several moderate Republicans. Instead, Senate leaders promised a separate vote by mid-December. Passage isn’t certain, and any measure would still need House approval. Without it, millions of marketplace enrollees could face steep premium hikes in 2026.

Telehealth policy is another loose thread. Most pandemic-era flexibilities for Medicare expired October 1, aside from mental-health and substance-use services. The spending bill leaves those lapses unaddressed, keeping virtual-care providers in limbo.

Every week of federal paralysis ripples outward. Rural hospitals dependent on federal grants for workforce and technology upgrades are dipping into reserves. Several Federally Qualified Health Centers have trimmed staff.

Patients face growing uncertainty during ACA open enrollment. Insurers have been hesitant to finalize 2026 rates without clarity on subsidies. “You can’t plan for 2026 if you don’t know whether the subsidies survive December,” one policy analyst said.

Meanwhile, public-health agencies warn that prolonged furloughs could slow outbreak detection. The CDC has scaled back genomic sequencing, and NIH clinical-trial research remains partly suspended.

What comes next

If the package clears both chambers, federal health functions could restart within days. CMS would begin clearing its claims backlog, the FDA could resume inspections, and NIH would reopen its grant portals.

Still, three unresolved issues could shape healthcare’s near future:

ACA subsidies remain uncertain. The deal guarantees only a Senate vote — not passage — on extending enhanced tax credits. Without it, enrollees face double-digit premium hikes in 2026, and insurers may scale back offerings.

Federal workforce protections expire soon. The measure shields employees from additional layoffs only through January 30, leaving agencies unsure about staffing beyond that date.

Telehealth coverage gaps persist. Most pandemic-era Medicare flexibilities ended October 1. The current plan doesn’t restore them, leaving patients and providers navigating inconsistent rules.

In short, the lights could flicker back on, but the power struggle behind them isn’t over. The real fight over ACA subsidies, telehealth, and long-term healthcare funding will likely stretch well into 2026.