On March 30, 2026, U.S. Representatives Greg Murphy, MD (R-N.C.) and Tom Suozzi (D-NY), introduced the Provider Reimbursement Stability Act of 2026, H.R. 8163. The bill’s intent is to modernize Medicare’s budget neutrality rules, which have led to unnecessary cuts in Medicare reimbursement due to outdated requirements.
H.R. 8163 promotes payment stability by:
- Increasing the budget neutrality threshold from $20 million to $54.3 million;
- Indexing the threshold to the cumulative percentage increase in the Medicare Economic Index (MEI) every five years;
- Requiring the Centers for Medicare and Medicaid Services to evaluate the actual base costs for running a medical practice at least every five years; and,
- Revising how CMS addresses erroneous utilization estimates for Medicare services to avoid unwarranted cuts.
- Capping annual conversion factor changes at 2.5 percent to reduce dramatic payment swings.
The Michigan State Medical State Medical Society, along with over 100 national and state medical societies, sent a letter commending the sponsors for their leadership on this issue, expressing strong support, and encouraging prompt passage of H.R. 8163. The letter points out that, when adjusted for inflation, Medicare reimbursement for physician services has declined 33 percent from 2001 to 2026. Additionally, it notes that physicians are the only Medicare provider type that doesn’t receive an annual payment update tied to inflation.
We are happy to report that on May 21, 2026,, the bill was unanimously passed by the U.S. House Ways and Means Committee; thereby, advancing it one step closer to consideration by the full House. But first, H.R. 8163 must now be considered by the House Energy and Commerce Committee.
In a press release from Congressman Greg Murphy, MD, he stated, "Access to high-quality, affordable care is drying up around the country, particularly in rural communities because reimbursement is less than the cost of care. These reductions are driving independent physicians out of practice, either to retire early, sell out to private equity, or be acquired by consolidated hospital systems. The first leads to fewer physicians, and the latter two drive up costs. This methodology is unacceptable, especially given the severe physician shortage our country faces.”
Physicians can take action to encourage their representatives to pass this bipartisan legislation that modernizes key budget neutrality rules and seeks fairness and predictability for medical practices and stability for physicians and patients by clicking here.
If you have additional questions, contact Stacey Hettiger at shettiger@msms.org.