March 16, 2026
MedPAC Recommends Positive Physician Update/Reduction in SNF Reimbursement
PALTmed recently led a coalition of organizations in urging the Centers for Medicare & Medicaid Services (CMS) to reverse reductions to practice expense (PE) payments for services provided in skilled nursing facilities (SNFs). The cuts reduce payment for clinicians caring for patients in SNFs, despite the fact that physicians and advanced practice providers incur the same practice expenses when caring for patients in nursing homes, regardless of facility designation.
The coalition’s letter to CMS warns that reducing payments for SNF services threatens access to care for some of Medicare’s most medically complex and vulnerable patients. Clinicians who care for nursing home residents—many of whom are independent practitioners or members of independent medical groups—bear the full cost of operating their practices, including electronic health records, staffing, malpractice coverage, and 24/7 clinical availability. Payment reductions in SNFs risk discouraging clinicians from practicing in post-acute settings and could worsen existing nursing home workforce shortages.
These concerns come amid broader instability in Medicare physician payment policy. The Medicare Payment Advisory Commission (MedPAC) recently recommended that Congress increase the Medicare physician payment update for 2027, acknowledging the growing gap between physician payments and the rising costs of delivering care. At the same time, MedPAC has recommended reductions to Medicare payments for skilled nursing facilities, further highlighting the financial pressures facing the post-acute and long-term care sector.
PALTmed continues to advocate for policies that support clinicians caring for patients in nursing homes and ensure Medicare beneficiaries maintain access to high-quality care in post-acute and long-term care settings.