The Medical Group Management Association (MGMA) has urged swift passage of the Medicare Patient Access and Practice Stabilization Act of 2025 introduced before the 119th U.S. Congress.
"Physician practices are now a month into the new year, facing uncertainty and financial shortfalls from the congressional failure to reverse the 2025 Medicare fee schedule cuts," stated Anders Gilberg, MGMA's senior vice president of government affairs. "These cuts have negatively impacted the viability of their Medicare business, commercial contracts tied to Medicare rates, as well as Medicaid reimbursement in states that use Medicare as a benchmark."
On January 1, a 2.83% Medicare reimbursement cut went into effect for physicians due to a rule finalized by the U.S. Centers for Medicare and Medicaid Services (CMS) in November of 2024. Compounded with the CMS’ own estimates of a projected 3.6% increase in practice cost expenses for this year, physicians could face a 6.43% cut, according to the legislation's supporters.
Physicians have essentially taken a 26% pay cut from Medicare over the past 22 years, said Rep. Kim Schrier, MD, (D-WA) in a joint statement with Rep. Gregory Murphy, MD (R-NC). "Their reimbursement has been flat or declining, while overhead costs have increased by about 47%: rent, labor, equipment, and insurance," Schrier added. "Physicians have been holding their breath, year after year, hoping that Congress will act to avert these devastating decreases in reimbursement."
MGMA noted that nearly 80% of all physicians are now employed by larger healthcare facilities because they have been unable to keep up with rapidly rising staff salaries, rent, and administrative costs.
