PEPC appreciates the opportunity to provide input on the proposed rule for the Calendar Year (CY) 2026 Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems and Quality Reporting Programs. As outlined in the letter, our comments advocate for payment parity between physician offices and hospital outpatient departments as one way to level the playing field for independent physicians.
Independent physicians have repeatedly demonstrated their superior ability to generate positive results in value-based care arrangements, both in improved health outcomes and reduced costs. However, consolidation in the health care sector has put the future of independent practice at risk and in turn jeopardizes access to affordable care in patients’ own communities. The largest driver of independent physicians selling their practice to a hospital or health system is to receive higher payment rates. The services of doctors, nurses and other skilled clinicians have been systematically undervalued by the Medicare program, with the gap between actual costs and reimbursed costs widening over time as costs increase.
Site specific payment policies drive consolidation, higher costs for Medicare and further stacks the deck against independent physicians and practices. When adjusted for inflation, Medicare reimbursement for physician services has declined 29% since 2001. Without broader reform to the Physician Fee Schedule, including a full Medicare Economic Index (MEI) update, CMS must work with Congress to ensure savings from site neutral payment policies are reinvested in Part B payment. We applaud CMS for taking steps to address this imbalance through provisions and requests for information (RFI) in this proposed rule.
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