News: New CMS PFS proposed rule decreases physician payments by 2.93%

CMS has released its physician fee schedule (PFS) proposed rule for the 2024-2025 calendar year (CY), according to a recent press release.

According to CMS, the average payments rates under the proposed PFS are scheduled to be reduced by 2.93% in CY 2025 (in comparison with CY 2024). “This amounts to a proposed estimated CY 2025 PFS conversion factor of $32.36,” says CMS, “a decrease of $0.93 (or 2.80%) from the current CY 2024 conversation factor of $33.29.”

The decrease in PFS payment rates was decried by the American Medical Association (AMA), which argued that the proposed “reinforces the clear need for systemic changes.”

“With CMS estimating a fifth consecutive year of Medicare payment reductions—this time by 2.8%—it’s evident that Congress must solve this problem,” said AMA President Bruce A. Scott, MD, in an AMA public statement. “In addition to the cut, CMS predicts that the Medicare Economic Index [MEI]—the measure of practice-cost inflation—will increase by 3.6%. Facing this widening gap between what Medicare pays physicians and the cost of delivering quality care to patients, physicians are urging Congress to pass a reform package that would permanently strengthen Medicare."

According to the AMA, Medicare physician payments, when accounting for practice cost inflation, have effectively declined 29% from 2001 to 2024.

Editor’s note: To read the CMS press release, click here. To read the AMA response, click here. To read the AMA’s graphic on PFS payment decline, click here.