Congress is poised to deliver physicians their fifth consecutive Medicare pay cut.
The recent congressional spending package failed to adjust physician reimbursement rates, leaving doctors to absorb a 6.3% reduction in compensation. This comprises a direct 2.8% pay cut and a 3.5% increase in medical inflation—or the rising costs of operating a practice—as calculated by Medicare’s economic indices.
However, House Republican leadership has now assured the GOP Doctors Caucus that they will block these physician payment reductions in the upcoming budget reconciliation process.
Will this commitment suffice to preserve Medicare access for patients?
How Is Congress Going To Cut Physician Pay?
Congress did not enact new legislation explicitly reducing physician pay; instead, it permitted a scheduled Medicare payment cut to proceed through inaction in the forthcoming continuing resolution. This passive approach effectively endorses a decline in reimbursement rates, exacerbating financial pressures on physicians.
“Physicians across the country are outraged that Congress’s proposed spending package locks in a devastating fifth consecutive year of Medicare cuts, threatening access to care for 66 million Medicare patients,” noted Bruce Scott, MD, President of the American Medical Association. “Despite repeated warnings, lawmakers are once again ignoring the dire consequences of these cuts and their impact both on patients and the private practices struggling to keep their doors open.”
The ripple effects reach beyond physicians, endangering patient care continuity as practices confront closure or consolidation. Rural providers, often in traditionally Republican districts and already operating with limited resources, may disproportionately shoulder this burden, exacerbating healthcare access disparities. The lack of inflationary adjustments in Medicare’s physician fee schedule intensifies this crisis, threatening the program’s sustainability and equity.
Why Is Congress Planning To Cut Physician Pay?
The Republican-led House prioritized other concerns, such as defense spending and border stability. Balancing tax cuts with the preservation of government programs consistently presents a political challenge. Moreover, carving out an exception for physicians in the continuing resolution could complicate matters, potentially inviting demands from other interest groups.
Cuts to physician payments emerge as the most politically feasible short-term solution, given constrained fiscal resources. Indeed, Congressional Budget Office analysis indicates that Republicans cannot meet their budget targets without reducing Medicaid or Medicare access cuts.
Reducing tangible benefits—beyond mere waste and fraud—risks touching a political third rail. Physician payment cuts offer both direct and indirect cost savings. The direct benefit stems from the obvious and pragmatic reduced reimbursement rates, while the indirect advantage arises again from downstream ripple effects: fewer patients seen, surgeries performed, and medications prescribed. Although physicians account for only 20% of healthcare spending, their clinical decisions drive substantial system-wide costs. For instance, if a surgery is not performed, there is no need for anesthesia, hospital admission, medications, rehabilitation or diagnostic imaging, amplifying the fiscal impact of these reductions.
Why Do Medicare Cuts Matter To Physicians?
Physician payments remain untethered from inflation adjustments under current Medicare reimbursement frameworks. Meanwhile, hospitals receive regular market-based annual update to offset rising operational costs, including a 2.9% increase in 2025. In contrast, physicians face static rates constrained by budget-neutrality provisions—archaic rules embedded in a convoluted policy landscape. Consequently, real physician compensation has plummeted 33% since 2001 when adjusted for inflation, while hospital payments have surged 60% over the same period. Escalating practice costs exacerbate this disparity, delivering a dual blow to providers. Moreover, again this ripple effect extends beyond physicians, ultimately jeopardizing patients’ access to care. This systemic imbalance demands urgent reform to align reimbursement with economic realities and safeguard Medicare’s foundational promise.
GOP leadership has the opportunity to pivot toward equitable policy solutions, prioritizing sustainable physician payment structures to preserve patient-provider ecosystems. Without intervention, access gaps will widen, undermining the program’s efficacy.
In the end, this won’t be about doctors it will be about patients.
Why Do Medicare Payment Cuts Matter To Patients?
Medicare patients will face escalating barriers to care access due to systemic reimbursement disparities. Private insurance consistently outpaces Medicare, reimbursing physicians approximately 43% more for identical services, despite anchoring its rates to Medicare’s benchmarks. No sustainable business model can endure perpetually increasing demands for diminishing returns. Consequently, physician practices face closure or consolidation into larger healthcare conglomerates, eroding independent care delivery.
This especially hits the rural areas harder where more patients tend to have Medicare insurance. A survey from the AMA in 2025 is that 20% of rural providers are planning to leave patient care in the next two years. They don’t have the margin.
Another often-overlooked aspect of this issue is that physician practices frequently operate with reduced staff. Practices with leaner teams, unable to fully fund operations amid stagnant reimbursements, often struggle to maintain quality customer service. This manifests in an overreliance on automated phone systems, fewer receptionists, longer office wait times, delays in prescription processing, and slower responses to routine test results—effectively spreading unchanged workloads across a diminished workforce. Such conditions undermine the success of the patients-physician relationship.
Without policy recalibration, these trends threaten Medicare’s accessibility mandate.
Will Republicans Save The Day With A Party Line Bill?
Politico reported that Speaker Mike Johnson (R-La.) and Majority Leader Steve Scalise (R-La.) have assured a key member of the GOP Doctors Caucus that they will address physician pay during reconciliation. This effort would be embedded within the broader framework of President Trump’s key agenda items. The proposal would take the form of a party-line bill—one that party members are expected to support out of loyalty or ideological unity, typically reflecting the party’s core priorities or platform. For physicians, this integration could prove to be beneficial. With cautious optimism, it could be a welcomed long-term integration for physicians.
However, this approach implies that physicians would face a pay cut during the continuing resolution process or the immediate vote on a temporary funding measure to keep the government operational. Nevertheless, this could ultimately benefit physicians if long-term, permanent changes are implemented, as suggested by Rep. Gregory Murphy, M.D. (R-N.C.). Rep. Murphy, a physician himself, has spearheaded efforts to ensure patient access and adequate Medicare reimbursement. “Doctors in America are struggling like never before because of ongoing Medicare cuts, and that’s putting millions of seniors at risk of losing access to affordable, quality health care,” Rep. Murphy previously stated in a Forbes interview.
The GOP’s reconciliation pledge offers a potential lifeline, intertwined with partisan priorities. This is not mere budgetary fine-tuning—it’s a high-stakes gamble on whether doctors and their patients can withstand another blow before the healthcare system buckles.
