January 28, 2025 – Medicare 2.8% Physician Payment : Congress failed to stop the reduction, impacting doctor reimbursements.
What Physicians Need to Know
Medicare 2.8% Physician Payment : Medicare reduced physician payments by 2.8% on January 1, 2025, after Congress failed to act before the year ended. With medical inflation, this effectively means a 6.3% loss for doctors. The California Medical Association (CMA) continues urging Congress to reverse these cuts.
Why Did This Happen?
The cut follows the expiration of a temporary 2.93% Congressional adjustment and a continued freeze on inflation-based updates under MACRA.
In 2015, lawmakers assumed most physicians would transition to Alternative Payment Models (APMs) by 2020. However, CMS approved very few APMs, leaving most doctors stuck in a system with no inflation adjustments.
Congress Failed to Intervene
A bipartisan plan aimed to block the cuts, but lawmakers removed it from a last-minute spending package. On December 20, 2024, Congress passed a short-term bill funding the government until March 14, 2025, with pandemic-era telehealth waivers extended until March 31, 2025.
Although some lawmakers promise to restore physician payments in March 2025, Medicare claims are already being processed at lower rates.
How It Affects Doctors and Patients
California physicians are frustrated and concerned. Many say these cuts could lead to:
- Early retirements
- Fewer Medicare patients accepted
- Practice closures, reducing patient access to care
Without urgent Congressional action, seniors and vulnerable patients will face even greater challenges in receiving medical care.tients—especially seniors and vulnerable populations—will suffer from reduced access to medical care.
Stay Informed
For ongoing coverage of Medicare payment updates and health policy changes, visit MedLegalNews.com, your trusted source for healthcare and legal news.
