Funding Bill Extends Telehealth Services and Reforms PBMs

Introduction

On February 4, 2026, President Trump signed a funding bill that not only ended a short-term partial government shutdown but also allocated funds to the Department of Health and Human Services. This legislation extends telehealth and virtual care flexibilities while enacting significant reforms for pharmacy benefit managers (PBMs).

Key Provisions of the Funding Bill

The funding bill, often referred to as a minibus package, did not reinstate the enhanced premium tax credits under the Affordable Care Act that expired on December 31, 2025. Additionally, it did not incorporate provisions from President Trump's healthcare plan aimed at directing funds to consumers' health savings accounts.

The Senate voted 71-29 on January 29 to advance the package, followed by a narrow House vote of 217-214 on February 3, sending the bill to the President for his signature.

Telehealth Extensions

The bill includes a two-year extension of Medicare telehealth flexibilities, which are now set to last until December 31, 2027. Furthermore, the Acute Hospital Care at Home waiver has been extended for five years, now valid until September 30, 2030. In-home cardiopulmonary rehabilitation flexibilities have also been extended through January 1, 2028.

Kyle Zebley, CEO of the American Telemedicine Association (ATA) and executive director of ATA Action, expressed gratitude for the bipartisan support: "This is a significant and hard-earned win for ATA Action, the ATA and our members, as well as for patients, caregivers, clinicians, and healthcare organizations, demonstrating the strength of sustained, credible, strategic advocacy."

The bill mandates that the Department of Health and Human Services (HHS) issue guidance within one year regarding the provision of telehealth services to individuals with limited English proficiency. Alexis Apple, deputy executive director of ATA Action, noted, "These multiyear extensions will give government agencies, legislators, and advocates needed time to hammer out the details of permanent provisions."

Pharmacy Benefit Manager Reforms

In addition to telehealth provisions, the bill includes bipartisan reforms aimed at prescription drug pricing, specifically through a provision known as Q1/Q2. This provision, previously part of the Lower Costs, More Transparency Act, requires the U.S. Food and Drug Administration (FDA) to clarify ingredient differences in drugs, facilitating the entry of more affordable generic alternatives into the market.

Moreover, the revenue generated by PBMs will be separated from drug pricing in Medicare Part D, which is expected to reduce incentives for steering patients toward higher-priced medications. PBMs will also be required to report pricing and other relevant data to Part D plan sponsors and to pass 100% of rebates to Medicare plans.

Merith Basey, CEO of Patients For Affordable Drugs Now, emphasized the importance of these reforms: "Strengthening competition and increasing transparency are key to lowering prescription drug prices. One in three Americans is unable to afford their prescriptions, and Congress must go further to tackle the root causes of high drug prices and rein in Big Pharma."

Conclusion

The recent funding bill marks a significant step in extending telehealth services and reforming the practices of pharmacy benefit managers, reflecting ongoing efforts to improve healthcare access and affordability in the United States.

Source: Funding bill extends telehealth, enacts PBM reform - HealthcareITNews