As of January 1, 2025, the Medicare Physician Fee Schedule (MPFS) conversion factor was reduced by 2.83 percent to $32.3465 from $33.2875 in 2024. The cut to Medicare physician services went into effect after Congress failed to address the pay cut to Medicare physicians in the scaled-back end-of-year package passed on December 20, which averted a government shutdown by funding the government through March 14. Besides providing a short-term extension of government funding, the package also extended the Medicare telehealth flexibilities through the end of March.
Congress had originally considered a provision to mitigate the conversion factor cut by 2.5 percent, but this was stripped from the end-of-year package when President-elect Donald Trump objected to the scope of package, which included appropriations, health, agriculture, and other provisions. Key members of Congress, including GOP Doctors Caucus member Representative Greg Murphy (R-NC), have already called for Congress to pass a retroactive physician reimbursement fix when they address government funding in March.