AIMPA to Congress: Don’t cut Medicare reimbursements

An organization representing thousands of independent physicians is joining the chorus of doctors’ groups asking Congress to reject reimbursement cuts in the 2024 Medicare Physician Fee Schedule (PFS).

The American Independent Medical Practice Association (AIMPA), in a letter to leaders of both parties in the U.S. Senate and House of Representatives, warned that the cuts will hasten consolidation in the health care market, leading to higher prices and reduced access to care. The AIMPA represents more than 350 independent practices with about 7,400 doctors.

According to the letter, more than 100,000 physicians have chosen to leave independent practice since 2019 to become employees of hospitals, health systems and other corporate entities. It blames that trend in part on “Medicare’s structural bias against independent physician practices,” noting that since 2001 Medicare’s reimbursement rates for hospitals and hospital outpatient centers have increased by 70%, compared to a 10% increase for independent doctors.

At the same time, the costs associated with running an independent practice have increased by nearly 50%, translating to a 26% decline in Medicare payments to physicians. “Medicare reimbursement simply hasn’t kept up with the cost of staffing, rent, insurance, and other operational expenses,” it says.

The fee schedule cuts, announced in early November as part of a Final Rule issued by the Center for Medicare and Medicaid Services (CMS), take the form of a 3.4% reduction in the Medicare conversion factor compared to 2023. The conversion factor is one of the three elements in the formula used to determine payments under the PFS.

“If Congress allows the planned 3.4% cut in Medicare reimbursement to take effect…payments made to physicians in independent medical practices will have declined by nearly 10% over the last four years—at the same time that inflation has been driving up the cost of care delivery,” the letter states.

The American Medical Association, the American Academy of Family Physicians, the American College of Physicians, and the Medical Group Management Association have also condemned the PFS reduction and called on Congress to modify or reverse it.

In place of cutting Medicare reimbursements, the AIMPA letter asks Congress to enact a proposed bill known as the Strengthening Medicare for Patients and Providers Act. That law, it says, would provide more certainty by indexing physician payments to the Medicare Economic Index.