Current Medicare Physician Payment Reform Efforts in Congress
The Medicare payment system has long been debated due to its complex reimbursement structures and lack of updates that reflect inflation and rising practice costs. Several bills have been introduced to address the ongoing challenges, especially for physicians and healthcare providers facing payment reductions and financial instability. This article reviews and summarizes the key pieces of legislation currently making their way through Congress aimed at reforming and stabilizing Medicare physician payments.
1. Strengthening Medicare for Patients and Providers Act (H.R. 2474)
Introduced: April 6, 2023
Sponsored by: Reps. Raul Ruiz (D-CA), Larry Bucshon (R-IN), Ami Bera (D-CA), and Mariannette Miller-Meeks (R-IA)
Key Provisions:
This bill focuses on tying annual updates to the Medicare Physician Fee Schedule (MPFS) to the Medicare Economic Index (MEI).
It aims to counteract the erosion of physician payments, which have dropped by 26% from 2001 to 2023 when adjusted for inflation.
By linking payment updates to the MEI, this legislation provides a predictable and inflation-based payment adjustment each year, stabilizing the payment environment for providers and helping prevent practice closures, particularly in underserved and rural areas.
Support and Impact:
The bill has bipartisan support and is backed by major physician organizations such as the American Medical Association (AMA). It is considered crucial for providing stability and predictability to physicians, enabling them to plan better and invest in their practices.
2. Provider Reimbursement Stability Act of 2023 (H.R. 6371)
Introduced: November 13, 2023
Sponsored by: Reps. Greg Murphy (R-NC), Brad Wenstrup (R-OH), Michael Burgess (R-TX), and Robin Kelly (D-IL)
Key Provisions:
The bill proposes several reforms to the budget neutrality adjustments in the Medicare payment system.
Increases the Budget Neutrality Threshold: It raises the threshold from $20 million to $53 million in 2025 and indexes it to the Medicare Economic Index thereafter.
Utilization Corrections: Introduces mechanisms to reconcile estimated versus actual utilization data, preventing sudden cuts caused by inaccurate projections.
Practice Cost Updates: Requires CMS to update practice cost inputs, such as clinical staff wages and supply prices, every five years.
Limits Conversion Factor Variance: Caps the year-to-year change in the conversion factor at 2.5% to avoid abrupt payment changes
Support and Impact:
This bill is considered a companion piece to H.R. 2474, focusing on technical adjustments and payment predictability. Its goal is to reduce the volatility caused by budget neutrality adjustments, disproportionately impacting specialists like neurosurgeons and cardiologists.
3. Physician Fee Schedule Update and Improvements Act (H.R. 6545)
Introduced: December 7, 2023
Sponsored by: House Committee on Energy and Commerce
Key Provisions:
Provides a 1.25% additional relief to offset the anticipated 3.4% cut in Medicare payments for 2024.
Focuses on reducing the conversion factor reduction to 2.15% instead of the full cut.
This bill serves as a stop-gap measure to prevent abrupt financial losses for providers while longer-term reforms are being discussed.
Support and Impact:
Gained unanimous support from the Energy and Commerce Committee, reflecting broad agreement on the need for short-term relief from the impending payment cuts.
4. Preserving Seniors' Access to Physicians Act (H.R. 6683)
Introduced: December 7, 2023
Sponsored by: Reps. Greg Murphy (R-NC) and Danny Davis (D-IL)
Key Provisions:
Seeks to eliminate the scheduled 3.4% Medicare payment cut entirely, preventing any reduction in payments for 2024.
This bill is a more aggressive response than H.R. 6545, aiming to completely eliminate the proposed cuts rather than just mitigating them.
Support and Impact:
It is supported by a broad coalition of medical societies and healthcare organizations that argue the current payment system fails to account for inflation and rising practice costs.
5. Alternative Payment Model Extension Act (H.R. 6369)
Introduced: October 2023
Sponsored by: Various bipartisan members of the House Doc Caucus
Key Provisions:
Extends incentive payments for physicians participating in eligible alternative payment models through 2026.
Encourages physicians to transition to value-based care models that focus on quality and outcomes, aligning with broader CMS initiatives.
Support and Impact:
This bill aims to sustain the momentum of value-based care initiatives by providing financial incentives for participation, which are set to expire soon.
Conclusion:
These bills collectively aim to address the financial instability and unpredictability faced by Medicare-participating physicians. While H.R. 2474 and H.R. 6371 tackle long-term stability through inflation-based updates and budget neutrality reforms, H.R. 6545 and H.R. 6683 focus on immediate relief from upcoming payment cuts. Meanwhile, H.R. 6369 seeks to sustain the shift toward value-based care.
The common thread among these legislative efforts is the recognition that the current Medicare payment system is unsustainable and threatens patient access to care. As these bills work through Congress, their success will be critical in ensuring that Medicare remains a viable and supportive program for patients and providers.
For more details on these bills and ongoing efforts, refer to Congress.gov's full legislative texts and status updates on Congress.gov or track specific bills on the AMA’s advocacy pages.
https://ruiz.house.gov/media-center/press-releases/bipartisan-doctors-congress-announce-legislation-provide-certainty
https://www.congress.gov/
https://www.ama-assn.org/
