The Centers for Medicare & Medicaid Services (CMS) released the final 2025 Medicare Physician Fee Schedule (PFS) rule on November 1, 2024, without removing the proposed conversion factor reduction. Therefore, a legislative solution will be necessary to stop this cut to physicians’ payments.

It is critical that physicians contact their Congressional members to urge co-sponsorship and expeditious passage of the bipartisan Medicare Patient Access and Practice Stabilization Act (H.R. 10073), a bill that would avert the proposed 2.8 percent cut to the Medicare conversion factor and add a positive payment update equal to half the Medicare Economic Index for 2025. Without legislative intervention, this will be the fifth straight year the conversion factor will be decreased. Given that CMS projects the increase in the Medicare Economic Index (MEI) for 2025 will be 3.5 percent, these continued reductions are unsustainable.

According to the Medical Group Management Association, the finalized policies in the 2025 Medicare PFS include:

1.  Setting the 2025 Medicare payment rates for physician services. For 2025, CMS finalized a conversion factor of $32.3465 and $20.3178 for Anesthesia (a decrease of -2.83% and -2.2%, respectively, over final 2024 rates).

2.  Allowing for payment of the G2211 add-on code when the O/O E/M base code is reported by the same practitioner on the same day for annual wellness visits, vaccine administration, or any Medicare Part B preventive service.

3.  Ending certain telehealth flexibilities extended by Congress through 2024 regarding geography, practitioner type, and sites of service.

4.  Continuing to allow direct supervision by a supervising practitioner through real-time audio and video interaction telecommunications through 2025, while permanently allowing it for a subset of services.

5.  Permanently covering audio-only telehealth services and allowing distant site practitioners to continue using their currently enrolled address when providing telehealth services from home in 2025.

6.  Maintaining the performance threshold of 75 points for all three MIPS reporting options for the 2025 performance year.

7.  Adding six new MIPS Value Pathways related to ophthalmology, dermatology, gastroenterology, pulmonology, urology, and surgical care.

8.  New coding and payment for caregiver training, advanced primary care management services, cardiovascular risk assessment and management, post-operative care, and behavioral health.

9.  Making numerous changes to the Medicare Shared Savings Program (MSSP), such as adopting a health equity benchmark adjustment and allowing successful Accountable Care Organizations (ACOs) an advance on their shared savings.

10. Creating an optional measure set (mandatory for MSSP ACOs) within the APM Performance Pathway (APP) for performance year 2025 — the APP Plus.

11. Ending the 1.88% APM Incentive Payment after the 2024 performance year without congressional intervention. CMS plans to increase the Qualifying APM Participant (QP) thresholds and will continue to use the Qualifying APM Conversion Factor in the 2025 performance year.

The text of the final rule can be accessed at: https://public-inspection.federalregister.gov/2024-25382.pdf 

Additional links include: 

- CMS Press Release  

- Physician Payment Schedule Fact Sheet  

- Medicare Shared Savings Program Fact Sheet

- Quality Payment Program (QPP) Fact Sheet