Bipartisan Group of Senators Form Working Group to Address Medicare Physician Payment System
A bipartisan group of senators has formed a Medicare payment reform working group which is working on new legislation that will bring long-term reforms to physician payments under Medicare. The new legislation will ensure that healthcare providers receive fair compensation for the services they provide.
For many years, physicians have complained that they are not fairly compensated for providing services under Medicare. The 2015 Medicare Access and CHIP Reauthorization Act (MACRA) made significant strides toward a value-based payment system from a system that paid on quantity, and it aimed to provide physicians with a stable payment system; however, MACRA has not achieved its goals and further action is required to address the reimbursement challenges that come with a system that aligns payment incentives with patient outcomes.
U.S. Sens. Catherine Cortez Masto, (D-NV); Marsha Blackburn, (R-TN); John Barrasso, (R-WY); Debbie Stabenow, (D-MI); Mark Warner, (D-VA); and Minority Whip John Thune, (R-SD) formed the group with the primary goal of investigating and proposing long-term reforms to the physician fee schedule (PFS) and updating MACRA. “As the health care system has evolved since the inception of the Medicare program, the physician payment system has failed to keep pace with the actual cost of care and the improvements in new services and technologies,” explained the Senators. “We believe Congress must make changes to the current Medicare physician payment system to ensure financial stability for providers, improve patient outcomes, promote access to quality care, and incentivize the utilization of emerging health care technology.”
One of the first steps will be to reach out to stakeholders to obtain their feedback on the current problems and potential solutions. The feedback collected will inform the development of policies that will address Medicare physician payment for the long term, increase compensation for physicians who provide services under Medicare, and improve the quality of care for patients.
Action needs to be taken. A 3.4% Medicare payment rate cut took effect on January 1, 2024, on top of a 2% payment reduction in 2023, and the Medicare Economic Index (MEI) was 3.8% last year and 4.6% this year, which is the highest level it has been this century. The American Hospital Association (AHA) recently highlighted that there has been an inflation-adjusted 30% decline in Medicare reimbursement rates since 2001 and the payment freeze will not end until 2026, while the cost of keeping practices open is continuing to soar. “Physicians always put patients first. It is time for our political leaders to prioritize our nation’s physician workforce by correcting the flaws in a Medicare system that unfairly penalizes doctors for the care they provide,” said the AHA. “We can, and must, do better.”
