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Updated Information on the 2025 Medicare Physician Fee Schedule

Happy Holidays! We wanted to update you on the good news we shared with you last week. The anticipated good news we shared last week unfortunately, did not happen.
 
To avert a government shutdown, both the House and Senate cleared the updated Continue Resolution package that will be in effect through March 14th. On December 21, President Biden signed this short-term funding bill that no longer includes relief for Medicare physician fee schedule cuts.
 
Through the House and Senate deliberations, there have been three versions of the funding bill. In the first two versions, a healthcare package was included. However, in the third version, the Medicare package was removed. Unfortunately, this slimmed down package did not include any relief from the physician fee schedule cuts. The only health provisions included in this slimmed-down package are:
 
-Extending the Medicare telehealth waivers
-Community health center funding
-Delayed cuts to DSH hospitals
 
Congressional sources say they appear to be putting together a plan that will go into effect next March. If this happens, this plan will include a fix for the Medicare physicians fee schedule cut. The fix would provide an increase for the remaining 9 months. There is precedent for the increase to be retroactive to January 1.
 
Bruce A. Scott, MD, President of American Medical Association, issued the following statement, with which we wholeheartedly agree:
 
“The Continuing Resolution utterly fails to address declining reimbursement rates for Medicare, pushing our health system down a path that will have predictable and deleterious results. For the fifth consecutive year, Congress has adjourned and allowed Medicare cuts. What will be the result? Patients struggling to access health care. Physicians are closing or selling their private practices while others opt to leave the profession.
 
Congress heads home today leaving in place a 2.83 percent cut for doctors. It did not provide a rational permanent, inflation-based update as the Medicare Payment Advisory Commission recommended. It didn’t even offer doctors a Band-Aid in the form of a cut reduction, as the cost of delivering care rises 3.5 percent next year.
 
With this new cut going into effect next year, Medicare payment rates have fallen by 33 percent over the past two decades, when adjusted for the costs of running a practice, leaving physicians struggling to figure out how they can continue to provide needed care to their elderly and chronically ill patients.
 
Congress also inexplicably missed a golden opportunity to improve patient care by refusing to include prior authorization reform in the final package – a reform with vast bipartisan support in both chambers. Leaving it on the cutting room floor is an unnecessary gift to the insurance industry at the expense of our patients. Physicians have unique training and expertise when prescribing appropriate care, and we don’t need insurance companies delaying and interfering with our patients’ vital treatments.”
 
Of course, we will continue advocating for a permanent fix in March that considers the Medicare Economic Index. This would provide yearly health extenders, which is necessary given that the issue has reached a tipping point.
 
Thank you again. If you have any questions, please feel free to contact us.
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