Specialists blast Medicare doctor pay ‘efficiency adjustment’

Modern Healthcare – Monday, November 3, 2025
By Bridget Early

Nearly three dozen physician specialty groups have called on Congress to halt a new policy that will reduce Medicare payments for thousands of billing codes.

The Centers for Medicare and Medicaid Services issued a final rule Friday setting Medicare reimbursements to physicians in 2026. Although the regulation grants a 2.5% overall rate increase, it also introduces a “efficiency adjustment” that will trim payments for some specialty services by 2.5%. One of the agency’s stated goals is to increase support for primary care.

But the American College of Surgeons and 33 other medical specialty societies cry foul in a letter sent Monday to House Speaker Mike Johnson (R-La.), House Minority Leader Hakeem Jeffries (D-N.Y.), Senate Majority Leader John Thune (R-S.D.) and Senate Minority Leader Chuck Schumer (D-N.Y.).

“We urge you to stop the implementation of this proposal before it begins on January 1, 2026, by using all legislative tools at your disposal,” the organizations wrote in the letter. “This ‘efficiency adjustment’ will cause further decreases in reimbursement for physician services and have wide-ranging consequences, including significant financial pressures that could limit patient access to medical care, particularly for the most vulnerable populations.”

The efficiency adjustment will apply to billing codes for “non-time-based services” such as surgery, diagnostic imaging interpretation, outpatient care, interventional pain management and orthopedic services. It does not apply to services that cannot be performed more speedily with practice, such as evaluation and management visits or behavioral health visits.

Because Medicare payment regulations cannot increase or decrease total program spending, the money not paid for those specialty interventions will be redistributed across other codes, including those for primary care services.

“This policy is based on the premise that services will continue to become more efficient indefinitely, and that all physicians experience the same rate of efficiency, which we believe to be flawed,” the American College of Surgeons and its allies wrote to the congressional leaders.

The specialty groups also assert that CMS based its policy on only a small subset of the data need to paint a full picture of what those services entail and that the efficiency adjustment fails to account for complexity or intensity.

“While advances in medical technology and treatment protocols allow more patients to survive severe illnesses, these same patients often later require complex, high-risk procedural intervention,” the letter says. “Highly experienced physicians may improve time efficiency, but undertake the most challenging cases, whereas newly trained or teaching physicians may treat less complicated patients but typically require more time.”

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