Medicare Payment System is Unsustainable 

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Medicare trustees acknowledged that patients will face limited access to Medicare-participating physicians because of the long-term growing financial instability of the Medicare physician payment system. Image for illustration purposes
Medicare trustees acknowledged that patients will face limited access to Medicare-participating physicians because of the long-term growing financial instability of the Medicare physician payment system. Image for illustration purposes

Mega Doctor News

Statement attributable to:
Gerald E. Harmon, M.D.
President, American Medical Association 

“Medicare trustees acknowledged that patients will face limited access to Medicare-participating physicians because of the long-term growing financial instability of the Medicare physician payment system. The AMA welcomes this recognition and urges Congress to work with physician stakeholders to put the payment system on a sustainable path.  

“The AMA and our partners in organized medicine have developed a set of principles to guide advocacy efforts on Medicare physician payment reform. This represents the first stage in our work to develop substantial changes to the payment system to improve the financial viability of physician practices and ease its administrative burdens. 

“Fiscal uncertainty is the only sure thing given the pandemic, statutory payment cuts, growing practice costs and administrative burdens. This report is a wake-up call. We should not hit the snooze button.” 

Below is from the Trustee’s report (Pg. 190):   

“While the physician payment system put in place by MACRA avoided the significant short-range physician payment issues resulting from the SGR system approach, it nevertheless raises important long-range concerns that will almost certainly need to be addressed by future legislation. In particular, additional updates totaling $500 million per year and 5-percent annual bonuses are scheduled to expire in 2025, resulting in a payment reduction for most physicians. In addition, the law specifies the physician payment updates for all years in the future, and these updates do not vary based on underlying economic conditions, nor are they expected to keep pace with the average rate of physician cost increases. The specified rate updates could be an issue in years when levels of inflation are high and would be problematic when the cumulative gap between the price updates and physician costs becomes large. The Trustees previously estimated that physician payment rates under current law will be lower than they would have been under the SGR formula by 2048 and will be about 30 percent lower by the end of the projection period. Absent a change in the delivery system or level of update by subsequent legislation, the Trustees expect access to Medicare-participating physicians to become a significant issue in the long term.” 

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