Medicare Reform: How it Impacts Your Healthcare

Medicare, along with other popular entitlement programs such as Social Security, which provides health insurance coverage to millions of Americans, particularly seniors or those with disabilities. But Medicare has an impact on all people who use health insurance as it sets the standard for reimbursement for private plans. As the population ages, and the birth rate declines, tension is put on the system as there are fewer young workers to support the increasing numbers of elderly beneficiaries living longer and longer. 

Inflation and Medicare Reform

Since 2001, inflation and increased administrative burden has driven up the cost of running a medical practice by nearly 47%.  Although payments to hospitals, nursing homes and other institutions have kept up with inflation (see infographic) Medicare payments to physician offices have not.

In fact, when adjusted for inflation, these payments have dropped by 30% since 2001! This means that offices providing care in the community are being reimbursed less and less while the costs for staff, equipment, and compliance continue to rise. This explains the reduced access to independent practices as more and more physicians choose employment at hospitals and megapractices.  According to the American Medical Association,” Between 2012 and 2022 the share of physicians who were self-employed fell by 9 percentage points from 53.2% to 44%. “

Medicare Reform – Why Should I Care?

The broken physician practice payment system that plagues Medicare is building pressure. With small practices going out of business, the options for care start

to dwindle. This fractured system could hurt underserved and low-income areas the worst with the possibility of losing the already limited healthcare

providers they have. But it affects all of us not just as we age, but even now, as Medicare influences the practices of the private insurance plans. 

Medical practices that hope to survive will have to save money by cutting back on expenses. Shorter operating hours, longer wait times, shorter appointments, fewer locations, and limited

access to vital services will affect everyone’s care as the healthcare system is forced to do more with less. Many doctors are also opting out of Medicare. This begs the question what the value is of insurance that few physicians participate in?

Here’s How You Can Help

• Contact your local congress people and tell them to support H.R. 2474 and other Medicare reform efforts. All that is being asked that like other healthcare organizations, that Medicare payments to physician offices keep up with inflation so that doctors can continue to offer the best care and run practices in the community. 
• Spread the word about what is happening and educate your community, family, and friends.