Late final 12 months, CMS finalized a fee discount for Medicare reimbursements to physicians. The CMS truth sheet states:

…common fee charges beneath the PFS [Physician Fee Schedule] can be decreased by 2.93% within the 12 months 2025, in comparison with the common quantity paid by these companies throughout a lot of the 12 months 2024

This appears like a modest pay lower, however based on the American Medical Affiliation, the true impression is even higher. CMS studies that the Medicare Financial Index (MEI) – a measure of follow value inflation primarily based on workers salaries and wages, workplace house, provides and malpractice claims – elevated 3.5%. So with reimbursements falling and follow prices rising, the precise reimbursement discount is nearer to the true reimbursement discount of 6.7%.

Why does CMS do that? MedPAC notes that CMS might goal to scale back reimbursement for physicians in conventional Medicare fee-for-service so as to shift them to superior various fee fashions (A-APM). Though the compensation distinction between FFS and A-APM physicians is only one% in 2027, it is going to develop to 10.5% over a long time.

MedPAC writes:

Traditionally, the Fee has discovered that Medicare beneficiaries have had comparable entry to care as privately insured people, however the elevated hole between MEI development and PFS updates may negatively impression beneficiaries' entry sooner or later.

Joe Paduda agrees with this evaluation.