AHA Recommends Changes to MACRA, Physician Payments to House Subcommittee

Why It Matters

Modernizing MACRA and the fee schedule directly impacts hospital revenue streams and provider incentives, shaping the financial health of the U.S. healthcare system. Timely reforms could improve cost transparency and sustain care access, especially in underserved areas.

Key Takeaways

• AHA requests inflation‑adjusted conversion‑factor updates for physician fees
• Improved cost metrics sought for MIPS to reflect true provider expenses
• AHA urges clearer incentives for advanced APM and ACO participation
• Coalition pressures CMS to protect APM and MIPS participants
• Reforms aim to stabilize hospital margins and rural care access

Pulse Analysis

Medicare’s physician fee schedule and the broader MACRA framework have become focal points for policymakers as they grapple with rising healthcare costs and shifting care models. The fee schedule’s conversion factor, which determines reimbursement rates for services, has not kept pace with inflation or the escalating input costs hospitals face. By calling for a data‑driven adjustment, the AHA hopes to align payments with current economic realities, reducing the gap between Medicare reimbursements and actual service expenses.

Beyond the conversion factor, the AHA’s recommendations target the Merit‑Based Incentive Payment System (MIPS), a core component of MACRA that evaluates clinicians on cost, quality, and improvement activities. The association argues that existing cost measures are outdated, penalizing providers who invest in high‑quality, low‑cost care. Enhancing these metrics would reward efficiency and encourage broader participation in alternative payment models (APMs), which are designed to shift risk to providers and promote value‑based care. The coalition’s simultaneous appeal to CMS underscores a unified industry push for equitable treatment of APM and MIPS participants.

If Congress and CMS adopt these suggestions, hospitals—particularly those in rural and financially vulnerable markets—could see steadier revenue streams and stronger incentives to maintain essential services. Updated payment formulas would also provide clearer signals for investment in technology and workforce development. Ultimately, the reforms aim to balance fiscal responsibility with the need to preserve access, positioning the U.S. health system for sustainable growth in the coming decade.