The final rule of the 2025 Medicare physician fee schedule has been released, highlighting two significant figures: a 2.8% payment cut for physicians and an estimated 3.5% rise in the Medicare Economic Index. These numbers underscore a growing concern among healthcare providers about sustainability.

"To put it bluntly, Medicare plans to pay us less while costs go up," reads a statement from the American Medical Association (AMA). This situation presents challenges for physician practices, particularly those operating on small margins, as they face difficulties in acquiring new equipment, retaining staff, accepting new Medicare patients, and maintaining operations, especially in rural and underserved areas.

The AMA had previously urged the Centers for Medicare & Medicaid Services to collaborate with Congress on enacting a permanent inflation-based update to Medicare physician payments. With limited legislative days remaining, the pressure is mounting on Congress to address these cuts during the lame-duck session.

Recent developments indicate some legislative momentum. A bipartisan group of 233 members signed a letter advocating for a legislative solution to counteract the cuts and provide payment updates that account for inflationary pressures. Additionally, a bipartisan bill has been introduced in the House aiming to halt pending cuts and offer reimbursement adjustments.

"The end-of-year panic over pending Medicare cuts faced by physicians year after year is getting old," states another part of the release. The call for systematic reform aims at making Medicare payments rational and sustainable amidst declining rates that have dropped by 29% over two decades when adjusted for practice costs.

With January 1 approaching swiftly, there is an urgent need for legislative action. "Although it might sound oxymoronic, we need an active lame duck," concludes the statement from AMA officials. The outcome holds significant implications for the 66 million patients dependent on Medicare services.