The proposal would be a significant step toward ensuring patient access, according to the American Medical Association. The association supports linking Medicare updates to the Medicare Economic Index but notes that the recommended 2026 update (MEI minus one percentage point) still falls short of covering practice cost inflation.
“This recommendation slightly adjusts the formula it endorsed last year to increase payment by 50% of MEI,” AMA President Bruce Scott, MD, said in a Jan. 16 statement shared with Becker’s. “While neither recommendation covers the estimated inflation that physician practices face, both approaches embrace the fact that Medicare payment updates need to be tied to inflation.”
The AMA has called on Congress to act on MedPAC’s analysis to maintain access to care.
Despite rising costs, CMS cut Medicare physician pay by 2.8% for 2025 — the fifth consecutive year of cuts — while Medicare Advantage plans are set to see a 4.33% average pay increase from 2025 to 2026.
“The Medicare payment system is broken. MedPAC has come up with a thoughtful response that heads in the right direction,” Dr. Scott said. “Congress must prioritize Medicare reform this year. The status quo is unsustainable and unhealthy for our country.”
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