CMS and Physician Pay
Over the past decade, Medicare payments to physicians and healthcare providers have seen a significant decline when adjusted for inflation, while the cost of living has steadily increased. For example, from 2013 to 2023, the Medicare Physician Fee Schedule (PFS) experienced minimal annual updates, with some years seeing no increase at all, and others seeing reductions. In 2023, a 2% and in 2023 another 1.68% pay cut was made. For 2025, the Centers for Medicare & Medicaid Services (CMS) has proposed a physician payment schedule that would result in a 2.8% across-the-board cut (AMA) This disparity has made it increasingly difficult for healthcare providers to cover the rising costs of running a practice, including salaries, equipment, and facility maintenance. Many providers have reported they are losing money on Medicare patients, particularly those in rural areas where the volume of patients may be lower.
Although there have been some Congressional efforts to change this situation, substantial reforms have yet to be made. Changes must be made to Medicare’s payment process to support providers and maintain access to care for beneficiaries. Visit the American Medical Association for more information.