On July 10, 2024, the Centers for Medicare and Medicaid (CMS), released the much-anticipated Calendar Year (CY) 2025 Medicare Physician Fee Schedule (MPFS) proposed rule. In the coming days and weeks, we will provide comprehensive updates regarding the details of the CY 2025 MPFS, but before that, it is important to reflect on the impact this proposed rule has on physicians, patients, and the business of healthcare as a whole.  

Medicare physician payment has been on a steady decline for over two decades. From 2001 to 2023, Medicare payments declined by 26 percent when adjusted for inflation. However, despite significant declines in reimbursement, the operating costs of running a healthcare practice have increased by 47 percent. There is a clear gap between how much physician expenses are and what the federal government is reimbursing physicians.  

This clear gap between revenue and expenditure puts physicians in a difficult financial position. The continual decrease in revenue could force physicians to opt out of the Medicare program altogether, making it harder for Medicare beneficiaries to seek care. With a looming physician shortage, many patients already experience difficulty as they seek healthcare. If Medicare physicians are forced to stop providing care to Medicare beneficiaries, the access issue will worsen significantly.  

The MPFS has broad implications for all areas of healthcare, affecting both physicians and patients alike.  To stay informed about the latest developments on the MPFS and other critical healthcare issues, be sure to follow us on Twitter/X and LinkedIn, and keep up with the A to ZPAC blog series.