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Physician practices around the country took an unprecedented financial hit with the arrival of the COVID-19 pandemic in March 2020. Recent research from the American Medical Association (AMA) reveals an estimated pandemic-related shortfall in Medicare physician fee spending of $13.9 billion, or a 14% reduction, across all states and all major specialties in 2020.
While the report pointed to a "strong recovery" in May and June, that recovery stalled in the second half of 2020, and spending never returned to pre-COVID-19 levels.
Dr Gerald Harmon
"Physicians experienced a significant and sustained drop in Medicare revenue during the first 10 months of the pandemic," said AMA President Gerald Harmon, MD, in a statement. "Medical practices that have not buckled under financial strain continue to be stretched clinically, emotionally, and fiscally as the pandemic persists. Yet physicians face an array of planned cuts that would reduce Medicare physician payments by nearly 10% for 2022."
The reduction in the Medicare physician fee schedule payments means providers may face payment cuts of more than 9% starting January 1, 2022, when the cuts take effect. That is, unless Congress makes changes.
Medicare physician fee schedule spending on telehealth stood at $4.1 billion, or 5% of the total Medicare spent in 2020. From March 16 to June 30, $1.8 billion of this amount was on telehealth, while $1.1 billion came in during third and fourth quarters of 2020, respectively, per the report.
