Medicare telehealth: $3.8 billion to extend a program half as used as it was in 2020

Medicare's telehealth flexibilities were built as an emergency measure in March 2020 — no longer restricted to rural patients, no longer tied to a clinic visit, billable from a beneficiary's home.▸ They were never made permanent. Instead they lapsed and were patched, repeatedly, through short-term extensions attached to whatever spending bill was moving. They lapsed on September 30, 2025, were patched to January 30, 2026, lapsed again, and were finally extended through December 31, 2027 when H.R. 7148, the Consolidated Appropriations Act, 2026, was signed into law on February 3, 2026 — the longest single extension since the pandemic emergency ended. The Congressional Budget Office scored that two-year extension at $3.8 billion in federal spending from 2026 through 2028, according to KFF's March 2026 summary of the estimate.

The bill is real.▸ So is the fact that fewer people are using what it pays for. CMS's own claims-based trends report counts Medicare fee-for-service beneficiaries who used at least one telehealth service each year since 2020 — and the number has fallen every year, plateauing at its lowest point yet.

CMS tracks two numbers every year: how many Medicare fee-for-service beneficiaries were eligible for a telehealth service, and how many actually used one.▸ Both totals have shrunk since 2020, but usage has shrunk faster — from a pandemic peak of 14.8 million users to 6.75 million in 2024, the lowest annual total in the report's five years of data.

The drop is steepest between 2020 and 2022 — 14.8 million to 8.5 million — as the acute pandemic emergency passed and in-person care became available again.▸ It kept falling into 2023 and 2024, but far more slowly: 6.97 million to 6.75 million, a decline of about 3%. Measured against the pool of beneficiaries CMS considers telehealth-eligible each year, usage has now held flat at 25% for two years straight — down from a peak of 48% in 2020, but no longer falling the way it did earlier in the series.

What changed in February 2026 wasn't the usage trend — it was Congress's appetite for re-litigating it every few months.▸ Since the original pandemic authority expired, telehealth flexibilities have been extended in a series of short patches, each requiring its own legislative vehicle and each carrying its own lapse risk. The fall 2025 government shutdown let the authority expire outright for weeks before a stopgap restored it to January 30, 2026; a second near-lapse followed before the Consolidated Appropriations Act, 2026 replaced the patch-and-lapse cycle with a single extension running to the end of 2027.

That extension isn't free, and CBO's $3.8 billion score reflects the same dynamic that runs through the usage data: even a program well off its pandemic peak still adds up when it covers millions of claims a year.▸ An earlier, preliminary CBO estimate for roughly the same two-year extension ran close to $4 billion, according to Inside Health Policy — in the same range as the $3.8 billion figure Congress ultimately worked from, and a reminder that a "temporary" flexibility now has a durable price tag attached to it every time it comes up for renewal.

Usage and eligibility figures cover Medicare fee-for-service Part B claims only, as reported by CMS through March 31, 2025; Medicare Advantage plans' telehealth utilization is not captured in this dataset and is not included here. The $3.8 billion cost figure is CBO's score as reported by KFF, since CBO's own cost-estimate PDF could not be independently retrieved at the time of writing.