A funding bill released by House Republicans would allow the 2.8% Medicare physician pay cut to take effect.
The stopgap measure, designed to keep the government funded through Sept. 30, the end of fiscal year 2025, does not include provisions to prevent the reduction. A vote on the bill is expected as early as March 11.
Physicians warn that the cuts could accelerate the closure of medical practices, clinics and hospitals — particularly in rural areas where financial margins are already thin.
“Today’s decision to allow the 2.8% cut to go forward is particularly devastating for rural and underserved communities,” American Medical Association President Bruce Scott, MD, said in a March 9 release. “These physicians and their patients have borne the brunt of the rising practice costs – 3.5% this year according to Medicare’s own estimate. When adjusted for inflation, Medicare payment to physician practices has dropped 33% since 2001. Let me be clear: these unsustainable cuts will force more practices to close and leave patients with fewer options for care.”
The AMA and other physician advocacy groups have long warned that stagnant reimbursement rates, combined with rising costs, are making it increasingly difficult for independent practices to remain viable.
In January, a bipartisan group of 10 House members introduced legislation to block the 2.83% Medicare physician pay cut and instead provide a 2% pay increase. The measure aimed to stabilize physician practices and protect patient access to care.
The bill has also received support from the House GOP Doctors’ Caucus, which has emphasized that continued Medicare payment cuts — particularly for physicians serving rural and underserved populations — are unsustainable.
The spending package does include some healthcare provisions, such as extending Medicare telehealth and hospital-at-home programs, delaying Medicaid disproportionate share hospital cuts, and providing six months of funding for community health centers, graduate medical education, and other expiring health programs. However, the funding for these programs is shorter in duration than what was included in the December healthcare package.