Physicians will see a 3.4% decrease in a key factor used to determine their base Medicare pay in 2024. Chiquita Brooks-LaSure, administrator of the Centers for Medicare & Medicaid Services, touted the benefits in announcing the final rule late last week.
"CMS remains steadfast in our commitment to supporting physicians and ensuring that people with Medicare have access to the care they need to stay healthy, as well as navigate health conditions they are facing," she said. "CMS is taking important steps toward those goals in this rule by improving payment for primary care and access to mental health care; paying for new navigation services to help people with cancer and other serious illnesses navigate their treatment; supporting family caregivers; paying for services involving community health workers to address health-related social needs that impact care; and enhancing access to dental care for people with certain cancers."
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However, Dr. Jesse Ehrenfeld, president of the American Medical Association, criticized the pay reduction. He noted that the Medicare Economic Index, which measures medical practice cost inflation, increased 4.6%, the highest in the last 23 years. The drop in physician pay will be challenging, especially for independent physicians.
"This is a recipe for financial instability," Ehrenfeld said. "Patients and physicians will wonder why such thin gruel is being served. Physicians routinely have faced cuts in the last two decades. Yet, there is nothing routine about the past few years. Physicians have faced the COVID pandemic and subsequent burnout. They have seen the costs soar for running a medical practice, while Medicare payment updates have offered too little relief."
Nevertheless, providers did get some positive news. Medicare will start hospital payment cuts a year later than originally proposed in response to stakeholder comments and also will extend several telehealth provisions for doctors. Additionally, family physicians said they' will benefit from the full implementation of a new billing code that will increase payment for complex patient office visits.
Related: Should doctors get a pay cut? House members wrangle over Medicare payments for 2024
Hospital group are also displeased. Medicare will cut payment for many hospital outpatient services starting in 2026 to reimburse safety-net hospitals that were hit by earlier cuts to a discount drug purchasing program that the Supreme Court ruled illegal. These pay cuts will amount to $7.8 billion over an estimated 16 years, officials said. Hospitals affected by the cuts to the drug discount program will get one-time lump-sum payments totaling $9 billion.
The hospital repayment policy "erodes the ability of hospitals to deliver lifesaving services that patients depend on, especially in rural areas where many hospitals are already struggling to survive," said Chip Kahn, CEO of the Federation for American Hospitals.
Jerry Penso, CEO of the American Medical Group, called on Congress to stop the cuts. Kahn also hinted that hospitals may take legal action against the safety-net hospital repayment plan, calling it a "decision to brush aside the Medicare statute."
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Alan Goforth
Alan Goforth is a freelance writer in suburban Kansas City. In addition to freelancing for several publications, he has written a dozen books about sports and other topics.
