Key takeaways:

  • AMA supports reforms that would stabilize the Medicare Economic Index and Alternative Payment Model.
  • Clinicians can help facilitate change by sharing their real-world experiences with lawmakers.

AMA recently reiterated its call for Congress to pass several reforms that would increase physician payment and improve health care accessibility.

During a House Energy and Commerce Subcommittee on Health meeting in May, the AMA advocated for these reforms:



Money for health care

AMA supports reforms that would stabilize the Medicare Economic Index and Alternative Payment Model. Image: Adobe Stock

  • H.R. 6160, or the Strengthening Medicare for Patients and Providers Act, which would establish a permanent inflationary update tied to the Medicare Economic Index, “closing the gap between rising practice costs and stagnant Medicare physician payment”;
  • H.R. 8163, or the Provider Reimbursement Stability Act, which would protect the permanent inflationary update from a budget neutrality mechanism that is meant to balance Medicare physician spending;
  • H.R. 8622, or the Medicare Physician Data-driven Performance Payment System Act of 2026, replacing the Merit-Based Incentive Payment System (MIPS), which adjusts payments according to performance measures, with a “fair, stable and transparent performance program that would finally end the era of penalizing practices that see sicker, more vulnerable patients while giving the majority of incentive money to well-resourced systems”; and
  • permanently stabilizing the Alternative Payment Model (APM) incentive payment and pairing it with the Implementing Physician-Led Ambulatory Care Transformation (MPACT) program, which would offer grants to physicians to test innovative care approaches, according to the AMA.

Physician payment has declined 33% since 2001, after adjusting for inflation, “and physicians remain the only Medicare provider without an automatic annual inflationary payment update,” an AMA press release said.

“Many physician practices, particularly in rural areas, are being forced to limit the number of Medicare patients they see or close altogether,” according to the organization.

In March, the Medicare Payment Advisory Commission recommended that Congress increase the payment update for physicians caring for Medicare patients in 2027 by 0.5% on top of the 0.25% and 0.75% updates to the APM — a payment system incentivizing high-quality care —and nonqualifying APM conversion factors, respectively, in the current law.

Flaws of the current system

In an article published in Health Affairs, Christopher P. Childers, MD, PhD, an assistant professor at the University of Washington, and colleagues explained that the current system’s budget-neutrality mechanism “does not apply to Medicare pay systems for hospitals, ambulatory surgery centers or other institutional settings. As a result, any increase in primary care reimbursement must be offset by decreases elsewhere, creating an inherently competitive division between specialties united by a uniform professional commitment to patient care.

“Compounding this, the physician payment over which specialties are forced to compete represents one of the smallest shares of health care spending,” they wrote.

Meanwhile, complying with MIPS costs around $12,800 per clinician yearly and requires 202 hours of physician and staff time, AMA said.

MIPS “is disproportionately penalizing small, rural and independent practices that do not have the same resources as large practices and health systems to comply with the program’s expensive and burdensome reporting requirements,” the organization said.

Feedback tied to MIPS is also failing, with physicians receiving feedback “for a given performance year up to 18 months after services were rendered, long after they can make meaningful adjustments,” the AMA said.

Stephanie Quinn, senior vice president of external affairs and practice experience at the American Academy of Family Physicians, told Healio that primary care is among the specialties facing the greatest strain from the current payment system “because the Medicare payment system still does not reflect the full value of what family physicians do every day.

“The current system pays largely by individual service or procedure, which means physicians must document and bill separately for many pieces of care — often while providing important work, like care coordination and patient counseling, that may not be fully recognized or paid for,” she said.

The current system also creates further instability, Quinn explained, because it “continues to place higher value on procedures than on the cognitive, relationship-based care that is at the heart of primary care.

“The result is a system that adds administrative burden, creates downward pressure on payment and makes it harder for primary care practices to remain financially sustainable,” Quinn said. “When payment does not keep pace with the cost of running a practice, independent physicians face growing pressure to sell to other large entities.”

Recent changes to the Medicare Physician Fee Schedule “are a step in the right direction, because they better recognize the higher overhead costs independent practices face compared with facility-based settings,” Quinn said. However, “broader reforms are still needed to make independent practice a viable option and protect patients’ access to care in their communities.”

How individual physicians can help

According to Quinn, health care professionals can help push these reforms forward by sharing real-world examples “of how Medicare payment instability affects their patients and practices. Policymakers need to hear what this looks like on the ground: longer wait times, fewer independent practice options and more difficulty recruiting new physicians into primary care.”

Specifically, health care professionals can respond to requests for comments about these reforms, speak with their professional medical societies and organizations, meet with policymakers “and help explain why stable, sustainable payment is essential to patient access,” Quinn said.

If reforms are not enacted, “patients will likely face longer waits, fewer choices and less access to primary care, especially in rural and underserved communities,” Quinn said. “More independent practices may be forced to consolidate or close, and some practices may no longer be able to accept Medicare patients. Over time, that means a smaller primary care workforce at the very moment patients need access to more continuous, comprehensive care.”

Sources/Disclosures

Source:

Healio Interviews

References:


Disclosures:
Quinn reports no relevant financial disclosures.

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