CHICAGO — At the Annual Meeting of the American Medical Association (AMA), the nation’s physicians called for a multipronged campaign to overhaul the outdated Medicare payment system, saying that patient access and survival of practices are at risk. Physicians from across the country spoke of their intense frustration with the flawed payment formula and the need for Congress to fix it.

“This cannot wait; we are past the breaking point. Congress must urgently address physician concerns about Medicare to account for inflation and the post-pandemic economic reality facing practices nationwide. Our patients are counting on us to deliver the message that access to health care is jeopardized by Medicare’s payment system. Being mad isn’t enough. We will develop a campaign – targeted and grass roots – that will drive home our message,” said AMA President Jack Resneck Jr., M.D.

In the face of inflation, the COVID pandemic, and growing costs of running a medical practice, physicians have struggled to keep open their doors, jeopardizing access to care. Not only have Medicare payments failed to respond, but physicians saw a 2% payment reduction for 2023, creating an additional challenge at a perilous moment. Physicians are one of the only Medicare providers without an inflationary payment update.

When adjusted for inflation, Medicare physician payment has effectively declined (PDF) 26% from 2001 to 2023. These increasingly thin or negative operating margins disproportionately affect small, independent, and rural physician practices, as well as those treating low-income or other historically minoritized or marginalized patient communities.

Medicare reform is a central plank in the AMA Recovery Plan for America’s Physicians.  

“We are deeply worried that many practices will be forced to stop taking new Medicare patients – at a time when access to care is already inadequate,” Dr. Resneck said. “Physicians have diagnosed the problem and are offering solutions, but obviously the body politic must respond.”

In January, the Medicare Payment Advisory Commission called for a physician payment update tied to the Medicare Economic Index (MEI) for the first time. And in April, a bipartisan group of House members introduced a bill that would provide annual inflation updates to the Medicare fee schedule based on the MEI.

“Duct-taping the widening cracks of a dilapidated payment system has put us in this precarious situation. Physicians are united in our determination to build a solid foundation rather than further jury-rigging the system,” Resneck said.

Editor’s note: An AMA Viewpoint highlights what is at stake to patients and physicians in Medicare physician payment reform.

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About the American Medical Association

The American Medical Association is the physicians’ powerful ally in patient care. As the only medical association that convenes 190+ state and specialty medical societies and other critical stakeholders, the AMA represents physicians with a unified voice to all key players in health care.  The AMA leverages its strength by removing the obstacles that interfere with patient care, leading the charge to prevent chronic disease and confront public health crises and, driving the future of medicine to tackle the biggest challenges in health care.