Medicare Cuts Strain Doctors and Access

Physicians treating Medicare patients have seen their real income drop by more than one-third since 2016 due to stagnant reimbursement, rising Medicare Advantage (MA) enrollment, and higher operating costs. This financial pressure is prompting some health systems to stop accepting certain MA plans, while many physicians may reduce their Medicare panels or exit the program entirely. Medicare patients represent a large share of many practices, with 67 million beneficiaries, half of Medicare’s $1 trillion spending on Part B services, and over half enrolled in MA plans. As physicians face financial losses from MA patients, some may prioritize traditional Medicare or commercial payers, creating a potential “two-tier” system where MA patients have fewer provider choices. Declining Medicare reimbursement also influences commercial payers, whose rates are often benchmarked to Medicare, potentially lowering physician income across the board. Reduced access to providers could drive more emergency visits, delayed care, worse patient outcomes, and higher healthcare costs. If current trends continue, physician shortages in Medicare, negative hospital margins, and shrinking access for seniors may worsen over the next decade, raising serious concerns about the sustainability of care for older Americans.

Condon, A. (2025, August 20). Why a ‘two-tier Medicare system’ may be on the horizon. Becker’s Hospital Review. https://www.beckershospitalreview.com/finance/why-a-two-tier-medicare-system-may-be-on-the-horizon/?origin=BHRSUN&utm_source=BHRSUN&utm_medium=email&utm_content=newsletter