A Unified Approach to Physician Payment Reform Will Help Bring Stability to the U.S. Healthcare System

Editor’s note: This conversation took place at the AAOS National Orthopaedic Leadership Conference/Fall Meeting in September 2024, prior to the most recent payment cut going into effect on Jan. 1.

On Jan. 1, a 2.8 percent cut to the Medicare Physician Fee Schedule went into effect, the latest in a series of annual payment reductions that are destabilizing physician practices in every community. Although hospitals, nursing homes, and other facilities that bill Medicare receive an inflation-based annual update, the Medicare physician payment system lacks such an automatic increase, leaving physicians in an increasingly disadvantaged position.

AAOS works alongside other physician groups to push for a plan to achieve long-term stability and sustainability for professional reimbursement in healthcare. Adam J. Bruggeman, MD, MHA, FAAOS, FAOA, chair of the AAOS Advocacy Council and orthopaedic spine surgeon at Texas Spine Care Center in San Antonio, sat down with AAOS Now Editor-in-Chief Robert M. Orfaly, MD, MBA, FAAOS, to discuss the importance of a unified approach to Medicare payment reform. 

Dr. Orfaly: What are the latest advocacy initiatives to address Medicare payment updates?
Dr. Bruggeman: We’ve been working at this for so many years. We come up [to Washington, D.C.] every year and say, “Please don’t cut us. Please don’t do this. Please stop the cuts.” Meanwhile, our colleagues within the hospital systems, surgery centers, and other people who provide care have been getting inflationary updates every year. We have decided this year that enough is enough. We’re done having a conversation about whether or not we should get cut or shouldn’t get cut. [Physician payment] is down over 10 percent over the last several years. If you compare [physician payment rates in 2024] to the original in 1998 when we went to a singular conversion factor, we’re several dollars below that in absolute terms—without even considering how much $1 was worth in 1998 versus $1 today in 2024.

The strategy that we came up with while meeting with other medical groups is we’re no longer going to talk about protecting against a cut. There is no other solution, other than ensuring that physicians are paid based on inflationary increases that reflect the actual cost of providing care. We aren’t going to keep coming up here and begging for our money not to be cut. We’re going to come up here and ask for what we’re really deserving, which is a stop to the cuts.

Can you speak to your work with other medical professional organizations?
It’s been a really big, important goal of mine to ensure that we have coalitions within what we do. We have one voice, and we have a very powerful voice here in Washington, D.C., thanks to all of the various members of AAOS who contribute both their time and their money [to AAOS’ advocacy efforts]. But we’re much, much stronger together as a whole house of medicine, when the family practice doctors and the internal medicine doctors and the emergency doctors and the anesthesiologists and the oncologists and the dermatologists and the orthopaedic surgeons are all going on the Hill with the same message in the same way, speaking the same language. We are stronger together than all the insurance carriers put together. We’re stronger together than all of the hospital systems put together.

We have come up with this plan over several phone calls with the heads of all of the various specialty societies. We all are in agreement. We’ve been doing the same thing every year. We get the same results every year, and there has to be an end to it. We have to put our foot down and say [physician payment cuts have] eroded private practice. It has prevented people from practicing in the way they want to practice. People are selling their practices. They’re shutting down their practices. They’re decreasing [healthcare] access for patients. There has to be an end. Enough is enough.

Not only are we talking about what we’re going to get paid today or tomorrow, but the long-term stability that allows you to plan for your practice for years into the future.
People from all over the world travel to the United States to receive healthcare, because we provide excellent healthcare here. We need to ensure that there is stability within the payment system, so that people want to become doctors, so that the next generation wants to be here and take care of us as we require care. So that the next generation of orthopaedic surgeons is equally, if not better, qualified and trained as we are today. It’s really, really important that we preserve a legacy for the future.

Robert M. Orfaly, MD, MBA, FAAOS, is a professor in the Department of Orthopaedics and Rehabilitation at Oregon Health and Science University. He is also the editor-in-chief of AAOS Now and chair of the AAOS Now Editorial Board.