Will Doctors Stop Seeing Medicare Patients after 20.1% Cut in Reimbursements Next Month?

Health Insurance Companies Process 1 in 5 Claims Wrong

Should Doctors Drop Medicare

Medicare Reduces Payments to Physicians

In the late afternoon on November 27th, the day before Thanksgiving as we were traveling to spend time with family and friends, the Centers for Medicare and Medicaid Services (CMS) released the Medicare Physician Fee Schedule for 2014 with a huge cut in reimbursements to providers.

CMS reduced the Medicare Conversion Factor (CF) from where it is today in 2013 at $34.0230 down to $27.2006 in 2014.

So what does that mean? It means that Medicare payments to doctors will be reduced by 20.1% starting on January 1, 2014.

Now the 20.1% cut in reimbursements is just an average. This means some specialties will see even more of a lower reduction in payments. But, if you a chiropractor, you’re in luck. Chiropractors will see a 12% increase in Medicare payments. Mental health providers will benefit too and get an 8% increase as well.

I wanted to see exactly what the difference was in dollars for the most popular office visit CPT codes our medical practices use, so I created the table below.

CPT Description Current
2013 Fee
2014 Fee
$ Diff % Diff
  99201     New, Office Visit, Level 1 43.89 32.91   -10.98
  99202    New, Office Visit, Level 2 75.51 56.58   -17.93
  99203    New, Office Visit, Level 3 108.19 82.15   -26.04
  99204    New, Office Visit, Level 4 164.67 126.21   -38.46
  99205    New, Office Visit, Level 5 203.80 157.22   -46.58
  99211    Est, Office Visit, Level 1 20.41 15.23   -5.18
  99212    Est, Office Visit, Level 2 43.89 33.18   -10.71
  99213    Est, Office Visit, Level 3 72.81 55.49   -17.32
  99214    Est, Office Visit, Level 4 106.83 81.87   -24.96
  99215    Est, Office Visit, Level 5 142.90 109.62   -33.28


Looking at the percentage difference by CPT code it looks like more than a 20.1% pay cut in our core Evaluation & Management codes. It is as high as 25%.

On top of these cuts there is currently a proposed bill in Congress to repeal the sustainable growth rate formula which allows Medicare to increase payments based on the growth of GDP (Gross Domestic Product). If this bill passes it will put a freeze on Medicare reimbursements for the next decade. That’s a freeze on increases, not reductions.

And did I forget to mention that we will still have the 2% cuts in reimbursement due to the federal spending sequestration.

There still is time for Congress to act and reduce the cuts as they did in the beginning of 2013. I sure hope they do but we will have to wait and see.

Subscribe to blogSo what are your thoughts about these Medicare cuts and how they will affect your practice? Will your doctors be dropping Medicare patients? Leave me your comments below.

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