Bill would give physicians a pay increase, block Medicare cuts
Congress must enact permanent reform instead of making last-minute payment fixes each year, says MGMA.
Photo: Reza Estakhrian/Getty Images
A bipartisan bill introduced in the House would stop Medicare payment cuts from taking effect in January and give physicians a pay increase.
The Medicare Patient Access and Practice Stabilization Act, introduced on Tuesday, would provide a 4.7% payment update in 2025 and eliminate the 2.8% Medicare physician payment cut that is slated for January 1.
WHY THIS MATTERS
The American Medical Association has been advocating for Congress to take action, pointing out that, when adjusted for inflation, Medicare reimbursement for physician services has declined 29% since 2001.
The bill comes just in time in the remaining legislative session, according to Dr. Bruce A. Scott, president of the AMA.
"The introduction today of a bill to stop the ruinous Medicare payment cut that is scheduled to go into effect Jan. 1 is a vital sign that Congress is poised to act," Scott said by statement. "Lawmakers must take action during the lame duck session. This bipartisan bill would fend off the proposed payment cut and also provide an increase equal to one half the Medicare Economic Index, which is similar to the recommendation from the Medicare Payment Advisory Commission."
The bill was sponsored by Reps. Greg Murphy, R-N.C. and Jimmy Panetta, D-Calif.
MGMA's Senior Vice President of Government Affairs Anders Gilberg said, "We urge Congress to quickly return from recess to pass this critical legislation, stopping the full 2.8% proposed cut to the Medicare physician conversion factor and providing a modest inflation update for 2025. These annual cuts represent an ever-present creeping decline that threatens the viability of our nation's medical groups. The fact that physicians must rely on Congress each year for a last-minute payment fix underscores just how broken the Medicare reimbursement system is. Moving forward, Congress must enact permanent, commonsense reforms that enable medical groups to keep their doors open and protect patients' access to care."
THE LARGER TREND
In July, the Centers for Medicare and Medicaid Services proposed a 2.8% reduction in the conversion factor for the 2025 Medicare Physician Fee Schedule final rule.
CMS said payment factors are specified in law. The average payment rate under the physician fee schedule rule was proposed to be reduced by 2.8% for 2025 compared to 2024, when factoring in the conversion factor.
The AMA called the continuing decreases, "death by a thousand cuts."
Compounded with CMS' own estimates of a projected 3.6% increase in practice cost expenses for next year, physicians will be faced with a 6.4% cut unless Congress acts, Scott said of the latest bill.
The decline in reimbursement rates, while wages and operational costs continue to rise, is forcing many physician practices to consider layoffs, reduced services, or office closure, he said.
Email the writer: SMorse@himss.org
