EDPMA asks for your help to avert payment reductions in the Medicare Physician Fee Schedule (MPFS). Unless Congress acts before the end of the year, the MPFS will experience another 3.37% reduction in 2024, relative to this year. To help mitigate the short-term payment cut and to provide long-term stabilization for the Fee Schedule, you’ll be asking Congress to:
- Stop the full 3.37% cut.
- Enact the bipartisan Strengthening Medicare for Patients and Providers Act (H.R.2474) to provide an annual inflationary update to the MPFS.
The MPFS formula generates annual reimbursement reductions, requiring Congress to step in at the last minute to mitigate these scheduled cuts. There are two drivers of instability and under-reimbursement for Medicare physicians.
First, unlike Medicare’s other major payment systems, the MPFS lacks a mechanism to reflect annual inflation, leaving physicians to absorb annual increases in the cost of practice. This results in physician reimbursement falling behind inflation metrics, and behind the reimbursement of all other providers. Once adjusted for inflation, the AMA estimates that Medicare physician reimbursement declined 26% from 2001 to 2023.
Second, the MPFS is subject to a budget neutrality requirement, by which payment increases over a certain threshold must be offset by reductions in spending that same year. Over the years, certain policy decisions by the Centers for Medicare and Medicaid Services (CMS) have added to reimbursement instability by triggering budget neutrality. CMS’ creation of a new add-on code (G2211) is the perfect example: just the implementation of this code alone is responsible for approximately 2% of the expected 3.37% reimbursement reduction.
Although Medicare reimbursement issues affect all clinicians in the program, emergency medicine providers are in a unique situation due to the Emergency Medical Treatment and Labor Act (EMTALA). EMTALA’s guarantee that every emergency patient be seen regardless of insurance status or ability to pay is a critical feature of our nation’s safety net and emergency care system, but it also creates an unfunded care mandate. The frequent delivery of underpaid and non-reimbursed services makes the reimbursement rates of other payers, including Medicare, critical.