TMA Calls on Lawmakers to Stop the Latest Medicare Pay Cut
By Emma Freer

Just days remain for Congress to stop yet another pending Medicare physician pay cut, and the Texas Medical Association is again feverishly working the nation’s Capitol.

TMA is imploring the Texas congressional delegation to stanch the net 1% pay cut set to take effect on July 1. In the longer term, the association also is calling on lawmakers to overhaul the Medicare physician payment system to prevent the constant threat of such cuts in the future.

“Given the ongoing [public health emergency] and increasingly lean financial margins of physician practices, TMA respectfully requests that Congress promptly intervene to prevent cuts to Medicare physician payments,” TMA President Gary Floyd, MD, wrote in a June 27 letter sent to Texas congressional lawmakers. “Doing so would help ensure Texas physicians who treat Medicare patients have sufficient resources to continue practicing medicine.” 

The impending cut stems from the TMA-backed Protecting Medicare and American Farmers from Sequester Cuts Act, which temporarily postponed Medicare physician pay cuts when President Joe Biden signed it into law on Dec. 10, 2021. Under the law, a .75% physician pay cut still took effect on Jan. 1, followed by a temporary, three-month 1% cut on April 1. The oft-delayed 2% cut is now due to take effect on July 1, raising the overall Medicare physician pay cut in 2022 from 1.75% to 2.75%.

This cut arrives after decades of Medicare physician pay reductions, and amid the COVID-19 pandemic, which has taken a financial toll on practices.

Between 2001 and 2020, Medicare physician payments decreased 22% when adjusted for inflation, whereas payments for other health care professionals have generally kept pace with inflation, according to the American Medical Association. Over the same period, the consumer price index for medical care in U.S. cities increased 95%, according to the U.S. Bureau of Labor Statistics.

If Congress does act to prevent the cut from taking effect, any relief will be short-lived. Additional Medicare physician pay cuts – projected to be between 7% and 10% – will take effect in 2023, further constraining Medicare patients’ access to care, TMA warns in its letter.

Nearly two-thirds of Texas physicians reported they might be forced to stop seeing new Medicare patients as a result of such drastic pay cuts, according to a TMA survey of nearly 1,400 members conducted in late 2021. Additionally, nearly 60% of respondents said they would consider opting out of Medicare entirely, and 43% said they might consider retirement.

Texas physicians are all too familiar with this rigmarole, which requires asking Congress multiple times a year to prevent additional cuts from taking effect, with mixed results. TMA thus has joined a chorus of state medical and national specialty societies, led by AMA, calling for Medicare physician payment system reform.

In late May, AMA released a set of principles TMA has endorsed – the Characteristics of a Rational Medicare Physician Payment System – to guide advocacy efforts. They call on Congress to:

  • Provide a baseline annual physician pay raise to keep up with inflation;
  • Eliminate, replace, or revise so-called budget neutrality requirements, which dictate any physician pay increase or decrease to be offsetting;
  • Incentivize value-based care that suits various practice settings; and
  • Support physician efforts to reduce health disparities.

“Physicians and the patients they treat deserve a reliable Medicare physician payment update each year that keeps up with inflation and practice costs,” Dr. Floyd wrote.

Last Updated On

June 28, 2022

Originally Published On

June 28, 2022

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Emma Freer


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Emma Freer is a reporter for Texas Medicine. She previously worked in local news, covering city politics, economic development, and public health. A native Clevelander, she graduated from Columbia Journalism School and the University of St. Andrews.

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