February 3, 2025
On January 31, a bipartisan group of 10 House of Representatives members introduced legislation aimed at halting the 2.83% Medicare payment cut to clinicians for this year. The bill also proposes a 2% payment increase to help stabilize medical practices and ensure patients continue to have access to quality care.
Reps. Greg Murphy, MD (R-NC) and Jimmy Panetta (D-CA), along with eight other lawmakers, introduced the Medicare Patient Access and Practice Stabilization Act. Set to take effect on April 1, 2025, this bill would reverse the 2.83% cut that began on January 1, 2025. While similar proposals garnered bipartisan support, Congress did not address the issue during the lame-duck session.
An analysis by the American Medical Association, based on data from the Medicare Trustees Report and the Federal Register, reveals that Medicare payments to clinicians have increased by just 7% from 2001 to 2025, which amounts to only 0.3% annually. In contrast, the cost of running a medical practice, including expenses like office rent, staff salaries, and insurance, has risen by 59% over the same period. When adjusted for inflation, Medicare payments have effectively dropped by 33% since 2001.
PALTmed encourages Congress to seek legislative relief under the reconciliation process, which would help the Centers for Medicare & Medicaid Services (CMS) prioritize high-quality care for Medicare beneficiaries while mitigating the risks of market consolidation and inadequate access to care. These concerns arise from the ongoing disparity between Medicare’s payment rates and the true costs of delivering high-quality care.
