Physicians get temporary reprieve from Medicare pay cuts

Physicians faced a Medicare pay cut next year of about 9 percent before President Joe Biden signed a bill Dec. 10 temporarily averting the cuts.

The Protecting Medicare and American Farmers from Sequester Cuts Act passed Congress with bipartisan support last week. The bill prevented across-the-board spending reductions until March 31. It also extended a pay increase under the physician fee schedule.

Since 2001, Medicare physician pay has dropped 20 percent, while the cost of running a practice increased 11 percent, according to the American Medical Association. The organization, which represents physicians nationwide, is in favor of halting the cuts and would like to see Congress further address flaws in the Medicare payment system.

"There is no need to wait for the last minute to start working on the systemic problems," AMA President Gerald Harmon, MD, said Dec. 9 after the bill passed Congress. "These automatic cuts should remind members of the needed reforms. Congress can get a head start on doing the right thing when it reconvenes early next year."

Physicians and surgery centers still are recovering from pay dips during the pandemic. CMS spending on ASCs dropped 90 percent in April 2020, when many ASCs limited procedures or temporarily closed. CMS spending remained 4 percent to 15 percent lower than expected in 2020,and CMS spending on physician services dropped $13.9 billion below expected levels.

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