For those medical professionals who have been struggling for years now with lower reimbursement, higher costs and increasing burnout, hope has arrived just in time. After half a decade of physician pay cuts, a bipartisan bill, has been introduced in the U.S. Senate by Roger Marshall (R-KS), who also happens to be a medical doctor. The Medicare Patient Access and Practice Stabilization Act of 2025, S. 1640, would temporarily reverse the 2.83% cut to the Medicare Physician Fee Schedule (MPFS) conversion factor that took effect in back in January. More significantly, the bill would create a 2% positive payment update.
The change in the conversion factor would be effective for services furnished beginning on June 1, 2025 and extending to the end of the year. According to the American Medical Association (AMA), the increase would equate to “roughly half of the 2025 Medicare Economic Index (MEI), which is a measure of cost inflation for physician practices.”
Rationale for Action
As the AMA has noted, “continued cuts to physician payment means that more practices are finding that it is not economically viable for them to keep their doors open, ultimately hurting patients’ access to care.” This year, the Centers for Medicare & Medicaid Services (CMS) projected a 3.5% increase in the MEI. At the same time, group practices are facing another payment reduction, while other providers, including hospitals and Medicare Advantage plans, are receiving payment updates that at least account for inflationary pressures, according to James Madara, MD, CEO of the AMA. “Without immediate legislative intervention, this growing disparity will further destabilize independent practices, accelerate market consolidation, and threaten access to care, particularly in rural and underserved communities,” Dr. Madara wrote.
Indeed, physicians and other billing practitioners have had to withstand Medicare cuts to the conversion factor for five straight years—cuts that came just as the cost of electric bills, insurance and office/medical supplies began to skyrocket. When adjusted for inflation, Medicare physician payments have declined 33% since 2001, according to an AMA study.
It’s important to note that it’s not just the AMA calling for Medicare payment reform for physicians. The 2024 Medicare Trustees report said that “absent a change in the delivery system or level of update by subsequent legislation, the Trustees expect access to Medicare-participating physicians to become a significant issue in the long term.”
Reason for Optimism
In response to the introduction of the Medicare Patient Access and Practice Stabilization Act, Dr. Madara sent a letter to Sen. Marshall on behalf of the AMA indicating the organization’s strong support for the bill. It reads, in part:
By fully reversing the 2.83% cut and applying a 2% update to the MPFS conversion Factor from June through December 2025, S. 1640 offers physician practices a temporary but important reprieve. It allows practices to better weather inflationary cost pressures while Congress works toward the long-term structural reform that Medicare urgently requires.
The question is: will this legislation make it to the president’s desk? There are reasons to be optimistic. Dr. Marshall introduced the Senate bill last month. A similar version of the bill was introduced in the U.S. House of Representatives back in January. Known as H.R. 879, the House bill was co-sponsored by Reps. Greg Murphy, MD (R-N.C.) and Jimmy Panetta (D-Calif.), signaling, once more, bipartisan support for a stop-gap solution. Thus far, the legislation has gained about 170 co-sponsors from both sides of the aisle.
The AMA has signaled its intention to assist in the advancement of this piece of legislation and will continue to collaborate with senators and representatives on “long-term structural reform to protect patient access and stabilize the Medicare physician payment system,” according to Dr. Madara.
Meanwhile, the Medicare Payment Advisory Commission (MedPAC) voted to urge Congress to link Medicare payment updates for physician practices to the growth in the cost of providing care. The recommendation came after Congress this spring failed to stop or reverse the 2.83% cut that kicked in Jan. 1, despite several proposals to do so.
Providers can contact their senators and urge them to back the Medicare Patient Access and Practice Stabilization Act. You can also visit the AMA’s Physicians Grassroots Network page to compose a message in support of this legislation by going to the following link: Be Heard | Physicians Grassroots Network. By taking action, we might just be able to “keep hope alive.”