A bill introduced this week with backing from representatives on both sides of the aisle would give the Centers for Medicare and Medicaid Services more flexibility to adjust physician payments while capping the scale of year-to-year rate changes.
The Provider Reimbursement Stability Act (H.R. 8163) is quarterbacked by Rep. Greg Murphy, M.D., R-N.C., who brought a similar bill in the prior Congress to no avail.
It comes amid calls from physician organizations for lawmakers to address pay cuts mandated by existing statute. Most physicians saw a 2.9% pay cut in 2025, but a 3.3% increase in 2026 (including a one-year, 2.5% bump in the One Big Beautiful Bill Act), and are scheduled for a 2.2% decline in 2027—each of which doctors and Murphy say lag rising practice costs and contribute to retirements or consolidation.
“By updating the Medicare Physician Fee Schedule reimbursement policies, we can protect private practice and ensure access to affordable, high-quality care across the country for generations to come,” the lawmaker said in a release.
The bill may not direct the broad, multi-year pay increases physicians have dreamed of, but still addresses the year-to-year cost forecasting challenges proponents say have sometimes divorced rate changes from reality.
"Unfortunately, the current budget neutrality framework within the Medicare physician fee schedule can create uncertainty and unintended pay cuts based on outdated policies or faulty assumptions,” Rep. Tom Suozzi, D-N.Y., who has backed the bill, said in a release. “We have to modernize outdated rules that hurt our doctors, and this bipartisan bill does just that. It just makes sense that we take care of the people who take care of us, and provide them with fairness and predictability so they can continue to provide quality care for patients across the country."
The new bill, according to a release, will increase a longstanding budget-neutrality threshold from $20 million to $54.3 million, with a mechanism to increase the threshold every five years with medical expense inflation. This gives CMS more wiggle room when adjusting prices for individual services without triggering a requirement to pay for the changes with corresponding cuts.
Additionally, it allows CMS to better correct botched estimates on the use of codes without triggering separate pay cuts due to budget neutrality requirements.
Other areas of the bill, per a release, limit changes in the conversion factor, or the amount that Medicare pays per work relative value unit (RVU), to 2.5%, in order to give practices more predictability when budgeting. Further, it instructs CMS to update the direct costs it uses to calculate practice expense RVUs every five years.
Those potential changes have been welcomed by physician associations.
“When CMS makes a forecast for the initial utilization of a new Medicare service, sometimes that forecast turns out to be inaccurate once claims data become available,” American Medical Association President Bobby Mukkamala, M.D., said in a statement included with the bill’s announcement. “There’s no reason that patients and physicians should have to bear the brunt of that miscalculation. This bill allows for a recalibration so that unnecessary cuts can be avoided. That’s good budgeting and good medicine."
The Medical Group Management Association, in a separate statement, said the legislation would relieve the Medicare Physician Fee Schedule from its “antiquated budget neutrality requirements.”
“For example, important increases to office visit RVUs often result in reimbursement cuts to unrelated procedures,” Anders Gilberg, the group’s senior vice president of government affairs, said. “These rules have destabilized Medicare payment over the years and undermined the ability of medical groups to continue treating Medicare beneficiaries. … MGMA looks forward to working with Congress to pass this critical piece of legislation.”
The Provider Reimbursement Stability Act was introduced in the House by Murphy on Monday and subsequently referred to committee. It’s sponsored by Reps. Suozi; Brad Schneider, D-Ill.; John Joyce, M.D., R-Pa.; Marianette Miller-Meeks, M.D., R-Iowa; Bob Onder, M.D., R-Mo.; Jimmy Panetta, D-Calif.; Kim Schrier, M.D., D-Wash; and Robin Kelly, D-Ill.