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Explore the History of Medicare Payment Reform

For decades, temporary patches and short-sighted solutions to the Medicare payment system have harmed Medicare beneficiaries and physicians, resulting in stagnant payment rates and threatening patient access to necessary care. Scroll through the timeline below to learn about key moments throughout the long road to Medicare payment reform.

Timeline
Start
Start
Now
Now
Year
1997
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The Balanced Budget Act (BBA) replaces the MVPS, creates the Sustainable Growth Rate (SGR) and replaces the three separate conversion factors with a single conversion factor (including an additional conversion factor for anesthesia services). The SGR system, as specified in the BBA, includes several technical flaws, one of which is the lack of any provision to correct the Centers for Medicare & Medicaid Services’ (CMS) estimates of the factors in the SGR, such as GDP growth, once actual data becomes available. Whereas CMS originally set a target rate of growth each fall for the coming fiscal year, they significantly underestimate the targets for the initial two fiscal years of 1998 and 1999.

Year
2002
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Physicians experience a 5.4% payment cut.

Year
2003
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Physicians are scheduled to receive a 4.4% Medicare cut, but two months into the year, Congress passes the Consolidated Appropriations Resolution which results in an average update of 1.6%.

Year
2004
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Physicians are scheduled to receive a 4.5% Medicare cut, but the Medicare Prescription Drug, Improvement, and Modernization Act (MMA) blocks the cut and allows for a two-year update of 1.5%.

Year
2016
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Despite a scheduled update of 0.5% under MACRA, due to the PAMA/ABLE Act provisions on misvalued services targets, physicians face a -0.36% reduction to the conversion factor.

Year
2018
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Despite a scheduled update of 0.5% under MACRA, due to the PAMA/ABLE Act provisions on misvalued services targets, the conversion factor is updated by only 0.31%.

Tell Congress to Cancel the Cut

The Centers for Medicare and Medicaid Services recently approved a 3.4% cut to Medicare physician payments for 2024. If Congress doesn’t act before the year is over, these proposed cuts will go into effect, worsening patients’ access to care and disproportionately harming small, independent and rural physician practices.

Congress needs to act now. Contact your lawmakers and urge them to cancel the cut and fix Medicare now, before it’s too late. Click the button below to take action!

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