“Family physicians provide high-quality care to our patients and communities, but inadequate, falling Medicare payment rates strain physician practices and create barriers to care for beneficiaries,” is how Academy President Steven Furr, M.D., FAAFP, put it in a statement.

That’s the heart of the problem with CMS’ proposed 2025 conversion factor, the amount Medicare pays per relative value unit. At $32.36, it would be, if finalized, 2.8% lower than the 2024 rate — continuing a yearslong trend of reduced conversion factors, following the most recent drop of about 3.4%.

The other half of this trend has been Congress passing short-term conversion-factor relief, limited by budget-neutrality requirements that prevent CMS from improving payment in any area of the fee schedule without cutting it somewhere else. This means the conversion factor generally holds steady while your practice costs continue to rise.

Beyond the obvious harm this deficit causes family medicine practices, the net effect of this rate stagnation has been a harmful dip in primary care spending — and patient access to primary care — across the board. Robert Graham Center research confirms that primary care spending decreased for all payers between 2019 and 2021; Medicare spending over that same span went down 15%.

What’s Next

I will update you with a more detailed analysis of the proposed rule in the coming weeks. I’ll preview one point here, though.

As we said in our statement, 2024’s implementation of the G2211 add-on code — a major AAFP win — has without question helped family physicians deliver longitudinal care to their patients. Responding to our follow-up advocacy, the 2025 proposed rule will allow G2211 to be billed alongside an evaluation and management visit when that appointment also includes an annual wellness visit, vaccine administration or Medicare Part B preventive services. 

What We’re Already Doing

The Academy has been very active in recent weeks to push for physician payments that keep up with your practice costs. We’re urging Congress to address budget neutrality and meaningfully reform payment with action such as passing the Strengthening Medicare for Patients and Providers Act (H.R. 2474), which would implement yearly inflationary updates for Medicare physician payment.

“Any payment reductions will threaten practices and exacerbate workforce shortages, which prevents patients from accessing the primary care, behavioral health care and other critical preventive services they need,” the Academy told lawmakers in a July 2 letter responding to a hearing on value-based payment.

We also reminded Congress this spring that strengthening Medicare payment for family physicians is a key way to push back against the problems swirling around the vertical integration of medical interests.

“Improving Medicare reimbursement for primary care and providing prospective, sustainable revenue streams to allow physicians to tailor their practices to their patients’ needs” was one of several meaningful steps we urged Congress to take in a May 23 letter to House members convening a hearing called “Breaking Up Health Care Monopolies: Examining the Budgetary Effects of Health Care Consolidation.”

What You Can Do

As I said, the AAFP is pushing to pass the Strengthening Medicare for Patients and Providers Act, a bill to ensure annual inflationary updates to Medicare payment based on the Medicare Economic Index. Please add your voice to this Speak Out campaign.