President Joe Biden on March 9 signed into law a measure that softened — but did not completely eliminate — a 2024 cut in a key rate used to determine how physicians are paid for treating Medicare patients.
While physician groups hailed the move as partial relief, they say they’ll continue to press for broader changes in the Medicare physician fee schedule.
The Medicare provision was tucked into a larger spending package approved by the US House and Senate.
The American Academy of Family Physicians (AAFP), the American Medical Association (AMA), and other groups have lobbied Congress for months to undo a 3.4% cut in the base rate, or conversion factor, in the physician fee schedule for 2024.
The conversion factor is used in calculations to determine reimbursement for myriad other services. Federal Medicare officials said the cut would mean a 1.25% decrease in overall payments in 2024, compared with 2023.
“With the passage of this legislation, Congress has offset 2.93% of that payment cut,” said Steven P. Furr, MD, AAFP’s president in a statement. “We appreciate this temporary measure but continue to urge Congress to advance comprehensive, long-term Medicare payment reform.”
In a statement, Representative Larry Bucshon, MD (R-IN), said the payment cut could not be completely eliminated because of budget constraints.
The Medicare physician fee schedule covers much of the care clinicians provide to people older than 65 and those with disabilities. It covers about 8000 different types of services, ranging from office visits to surgical procedures, imaging, and tests, according to the Medicare Payment Advisory Commission (MedPAC).
Along with physicians, the fee schedule sets payments for nurse practitioners, physician assistants, podiatrists, physical therapists, psychologists, and other clinicians.
In 2021, the Medicare program and its beneficiaries paid $92.8 billion for services provided by almost 1.3 million clinicians, MedPAC said.
Larger Changes Ahead?
Rep. Bucshon is among the physicians serving in the House who are pressing for a permanent revamp of the Medicare physician fee schedule. He cosponsored a bill (HR 2474) that would peg future annual increases in the physician fee schedule to the Medicare Economic Index, which would reflect inflation’s effect.
In April, more than 120 state and national medical groups signed onto an AMA-led letter urging Congress to pass this bill.
The measure is a key priority for the AMA. The organization reached out repeatedly last year to federal officials about it through its own in-house lobbyists, this news organization found through a review of congressional lobbying forms submitted by AMA.
These required disclosure forms reveal how much AMA and other organizations spend each quarter to appeal to members of Congress and federal agencies on specific issues. The disclosure forms do not include a detailed accounting of spending on each issue.
But they do show which issues are priorities for an organization. AMA’s in-house lobbyists reported raising dozens of issues in 2024 within contacts in Congress and federal agencies. These issues included abortion access, maternal health, physician burnout, and potential for bias in clinical use of algorithms, as well as Medicare payment for physicians.
AMA reported spending estimated cost of $20.6 million. (AMA spent $6.7 million in the first quarter, $4.75 million in the second quarter, $3.42 million in the third quarter, and $5.74 million in the fourth quarter.)
In a March 6 statement, Jesse M. Ehrenfeld, MD, MPH, AMA president, urged Congress to turn to more serious consideration of Medicare physician pay beyond short-term tweaks attached to other larger bills.
“As physicians, we are trained to run toward emergencies. We urge Congress to do the same,” Dr. Ehrenfeld said. “We encourage Congress to act if this policy decision is an emergency because — in fact — it is. It is well past time to put an end to stopgap measures that fail to address the underlying causes of the continuing decline in Medicare physician payments.”
There’s bipartisan interest in a revamp of the physician fee schedule amid widespread criticism of the last such overhaul, the Medicare Access and CHIP Reauthorization Act of 2015.
For example, Senate Budget Chairman Sheldon Whitehouse (D-RI) has proposed the creation of a technical advisory committee to improve how Medicare sets the physician fee schedule. The existing fee schedule provides too little money for primary care services and primary care provider pay, contributing to shortages, Sen. Whitehouse said.
Sen. Whitehouse on March 6 held a hearing on ways to beef up US primary care. Among the experts who appeared was Amol Navathe, MD, PhD, of the University of Pennsylvania, Philadelphia, Pennsylvania.
Dr. Navathe said the current Medicare physician fee schedule tilts in favor of procedural services, leading to “underinvestment in cognitive, diagnostic, and supportive services such as primary care.”
In addition, much of what primary care clinicians do, “such as addressing social challenges, is not included in the codes of the fee schedule itself,” said Dr. Navathe, who also serves as the vice chairman of MedPAC.
It’s unclear when Congress will attempt a serious revision to the Medicare physician fee schedule. Lawmakers are unlikely to take on such a major challenge in this election year.
There would be significant opposition and challenges for lawmakers in trying to clear a bill that added an inflation adjustment for what’s already seen as an imperfect physician fee schedule, said Mark E. Miller, PhD, executive vice president of healthcare at the philanthropy Arnold Ventures, which studies how payment decisions affect medical care.
“That bill could cost a lot of money and raise a lot of questions,” Dr. Miller said.
A version of this article appeared on Medscape.com.