ASDSA AdvocacyMembers OnlyReimbursement Resources for Members

Medicare Reform Resources

Physicians and Patients are Facing a Crisis: The Outdated Medicare Physician Payment System Needs Systemic Reform to Protect Patient Access to Care.  

Lack of Fair Reimbursement and Rising Practice Costs May Force Physicians to Stop Taking Medicare Patients or Possibly Close Their Practices Permanently  

Medicare payments to physicians have been steadily declining relative to inflation, and this trend will persist unless Congress acts to fix the flawed and outdated payment rules:

  • Medicare payments to physicians, including dermatologists, do not receive an annual inflationary update and are subject to budget neutrality constraints.
  • Since 2001, Medicare reimbursement rates have lagged 33% behind the rate of inflation growth, totaling more than two decades of stagnant payment.
  • Medicare’s trustees and the Medicare Payment Advisory Commission (MedPAC) support taking action to update physician payment, as does every lawmaker in Congress with a medical background.

Physicians additionally continually face Medicare cuts due to payment redistributions caused by policy changes implemented by the Centers for Medicare & Medicaid Services (CMS), totaling a more than 10% reduction in the past five years:

  • Late last year, CMS announced final plans for payment schedules for physicians and approved a 2.83% reduction in Medicare's physician payments marking the fifth consecutive year of cuts as of Jan. 1, 2025.
  • Congress, unfortunately, failed to address this cut or provide any inflationary updates in the most recent congressional funding packages.

Amidst Rising Overhead Costs and Record Inflation these Policies Have Been Devasting to Physicians’ Practices and Patients:

  • On top of rising practice costs and lack of fair reimbursement, dermatologic surgeons are struggling to keep their practices open. Without comprehensive Medicare reform, physicians may be forced to turn away Medicare patients, or worse close our practices permanently, leaving patients without the life-saving care they need.

This is a key priority area for ASDSA members and their patients. ASDSA will continue to fight to preserve patient access to care and support further Medicare reform.

Currently, there are Two Paths Forward in Congress:

  1. House Republican Leaders have released their budget reconciliation proposal:

    • Ties reimbursement to 75% of MEI-based Medicare payment update for 2026, an estimated 2.25% increase
    • Adds a unified 10% MEI update starting in 2027, ending temporary fixes.
    • ASDSA with our partners in the House of Medicine support these reforms as a step toward broader Medicare payment reform.

  2. Representatives Greg Murphy, MD (R-NC) and Jimmy Panetta (D-CA), along with a bipartisan group of legislators, introduced the Medicare Patient Access and Practice Stabilization Act of 2025 (H.R. 879) in the House and Senator Roger Marshall, MD (KS) has now introduced S. 1640 as the Senate counterpart:

    • Reverses the 2.83% reimbursement cut for 2025
    • Provides a 2% payment increase from June to December 2025.
    • Since its introduction, over 150 Members of the House of Representatives have cosponsored H.R. 879, and the Congressional Doc Caucus announced its endorsement.

It is crucial we communicate to Congress the devastating consequences these cuts will have in their communities and urge them to pass this legislation to protect patient access and physician practices.