An influential panel is seeking an increase in Medicare’s 2025 payments for clinicians, adding to pressure on Congress to reconsider how the largest US purchaser of health services pays for office visits and related care of the nation’s older citizens and those with disabilities.
The Medicare Payment Advisory Commission (MedPAC) on Thursday voted unanimously in favor of a two-part recommendation on changes to the 2025 physician fee schedule:
- An increase in the base rate equal to half of the projected change in the Medicare Economic Index (MEI). Recent estimates have projected a 2.6% increase in MEI for 2025, which is intended to show how inflation affects the costs of running a medical practice.
- The creation of a safety-net add-on payment under the physician fee schedule to cover care of people with low incomes.
These recommendations echo the calls MedPAC made in a 2023 report to Congress.
Lawmakers and the Centers for Medicare and Medicaid Services (CMS) rely on MedPAC’s work in deciding how much to pay for services. About 1.3 million clinicians bill Medicare for their work, including about 670,000 physicians.
Thursday’s MedPAC vote comes amid continuing uncertainty about how much the federal government will actually pay clinicians this year through the physician fee schedule.
There are serious efforts underway to undo cuts already demanded by previously passed federal law. In an email, Rep. Larry Buchson, MD, (R-IN) said he remains committed to “eliminating the full 3.37% cut this year while also working toward a permanent solution to halt the downward spiral of physician reimbursement.”
“The Medicare payment cut to physicians will impede patients’ access to care and further accelerate the current path toward consolidation, physician burnout, and closure of medical practices,” Buchson told this news organization. “It’s past time that Congress provides much needed and deserved stability for America’s doctors.”
Congress this month is attempting to complete overdue budget legislation needed to fund federal operations for fiscal 2024, which began October 1, 2023. The pending expiration of a short-term stopgap continuing resolution could provide a vehicle that could also carry legislation that would address the physician fee schedule.
In a Thursday statement, Jesse M. Ehrenfeld, MD, MPH, president of the American Medical Association, commended MedPAC for its recommendations and urged lawmakers to act.
“Long-term reforms from Congress are overdue to close the unsustainable gap between what Medicare pays physicians and the actual costs of delivering high-quality care,” Dr. Ehrenfeld said. “When adjusted for inflation in practice costs, Medicare physician pay declined 26% from 2001 to 2023.”
Continual Struggles
Congress has struggled for years in its attempts to set Medicare payments for office visits and other services covered by the physician fee schedule. A 1990s budget law set the stage for what proved to be untenable reductions in payment through the sustainable growth rate mechanism.
Between 2003 through April 2014, lawmakers passed “doc-fix” legislation 17 times to block the slated cuts, according to the Congressional Research Service. In 2015, Congress passed an intended overhaul of the physician fee schedule through the Medicare Access and CHIP Reauthorization Act (MACRA). As part of this law, Congress eliminated a base automatic inflation adjuster for the physician fee schedule.
In recent years, Congress has acted repeatedly to address MACRA’s mandates for flat base pay. MedPAC and members of both parties in Congress have called for a broad new look at how Medicare pays physicians.
At Thursday’s meeting, MedPAC member Lawrence Casalino, MD, PhD, MPH, noted that the struggles to keep up with inflation and the “unpredictability of what the payment rates are going to be from year to year really do affect physician morale.”
A version of this article appeared on Medscape.com.