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Independent physician practices are essential to patients in communities nationwide. But a new proposal from the Centers for Medicare & Medicaid Services could make it significantly harder for some of these practices to remain viable, according to AMA President Willie Underwood III, MD, MSc, MPH, who is raising the alarm over a proposed CMS 50% Medicare E/M cut.
What the CMS 50% Medicare E/M Cut Would Actually Do
The American Medical Association is urging CMS to reject a proposal that would cut Medicare payment by 50% when a physician provides a separately identifiable office or outpatient evaluation and management visit on the same day as most procedures are performed. CMS has not provided the evidence needed to justify a cut this large, Underwood wrote, and for independent physician practices already working to keep up with rising costs, the consequences could be severe.
Why Modifier -25 Matters to This Dispute
Physicians know that a patient may come to the office with a new or worsening problem that requires evaluation, diagnosis and medical decision-making, and also need a procedure during that same visit. When those services are distinct, physicians should be paid for both. Physicians appropriately report Modifier -25 to indicate that an E/M service is significant and separately identifiable from the procedure.
Why AMA Questions the Timing of This CMS 50% Medicare E/M Cut
The AMA is pressing CMS to explain why it is reviving this policy now. The agency considered a similar, narrower proposal in 2019 and ultimately chose not to finalize it after reviewing feedback from physicians and other stakeholders. The current proposal is broader, extending the policy to more procedures, and Underwood asks what has changed to justify this significant expansion.
The Existing Process AMA Says Should Be Used Instead
Medicare already has a process for addressing genuine overlap in payment. The AMA and medical specialty societies work through the AMA/Specialty Society Relative Value Scale Update Committee, alongside CMS, to review the resources required to provide medical services. That process already accounts for work that overlaps when procedures are commonly performed with an E/M service, and if specific services still contain duplicative resources, Underwood argues those services should be identified and reviewed individually rather than addressed through a blanket reduction.
The Financial Stakes Behind This CMS 50% Medicare E/M Cut
The consequences could be especially profound for independent, office-based practices, which bear the costs of clinical staff, supplies and equipment needed to provide care. For some services, CMS’s own example shows that the proposed reduction could leave payment below these direct costs, even before accounting for the physician’s role.
Why This Threatens Broader Patient Access
That is not a sustainable payment system, according to Underwood, and it runs counter to the goal of maintaining strong independent practices and ensuring patients, particularly those in rural and underserved communities, continue to have access to care.
What the AMA Is Committing to Do Next
The AMA will continue advocating for CMS to withdraw this proposal and work with physicians and other stakeholders to address any genuine instances of duplicative payment through targeted, evidence-based changes. Underwood frames the core question directly: “How does it make any sense to pay a physician less for doing what is right for their patients?”
How This Fits Broader Medicare Payment Reform Discussions
This proposal arrives alongside other Medicare payment developments the AMA has tracked recently, including a bipartisan House bill introducing four Medicare pay reforms, suggesting physician payment policy is facing active scrutiny and proposed change across multiple fronts simultaneously heading into the current rulemaking cycle.
What This CMS 50% Medicare E/M Cut Proposal Means Going Forward
Given AMA’s specific point that CMS considered and declined to finalize a narrower version of this policy in 2019, the association’s central argument rests on the agency needing to justify why current circumstances warrant a broader, more aggressive version now. Independent practices evaluating their own financial exposure to this proposal may want to review CMS’s own cited examples showing potential payment falling below direct costs for certain services, since this specific evidence point forms a core part of AMA’s case against the change.
What to Watch Going Forward
As the comment period on this proposal continues, industry observers will likely watch whether CMS responds to AMA’s request for evidence justifying the policy’s revival and expansion, and whether the agency ultimately finalizes, narrows, or withdraws the rule as it did with the similar 2019 proposal. Given AMA’s warning about the specific threat to rural and underserved community access, this CMS 50% Medicare E/M cut debate may draw continued attention from independent practice advocates and patient access groups as the rule moves toward finalization.
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