Proposed Physician Payment Increases and Their Effects on Oncology Practices

​The financial stability of oncology practices has been a growing concern as physician reimbursement rates have steadily declined over the past couple of decades largely due to conversion factor reductions, amongst other things. On January 1, 2025, the Centers for Medicare & Medicaid Services (CMS) implemented a 2.8% reduction in physician payments, intensifying financial pressures on providers and raising broader concerns about workforce sustainability and patient access to care [1]. In late January, a bipartisan bill was introduced in Congress proposing a 6.6% payment increase, effective April through December 2025, aiming to offset the effects of the recent cut and stabilize physician reimbursement [2].

The Impact of Declining Physician Payments on Oncology Practices

Oncology practices, which often operate on thin margins due to high overhead costs and complex reimbursement structures, are particularly vulnerable to payment reductions. Studies indicate that consistent decreases in Medicare reimbursement have increased financial strain on community oncology providers, pushing many toward hospital integration or practice closure [3]. The January 2025 reduction further drives concerns about maintaining independent oncology practices and ensuring continued patient access to specialized cancer care [4]. Beyond financial strain, these reimbursement trends impact workforce sustainability. The transition from practitioner to “specialist” takes more than a decade in training, and persistent payment cuts may discourage new medical graduates from entering the field. [5]. If Congress passes the proposed 6.6% increase, it could provide a much-needed financial buffer, helping to sustain oncology practices and prevent further physician shortages. ​

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Stability in Reimbursement and Patient Access to Care

Medicare reimbursement plays a significant role in determining oncology practice viability. According to a report by the American Society of Clinical Oncology (ASCO), financial instability due to declining payments has led to delays in care, reduced treatment options, and increased patient travel distances as smaller oncology practices shut down or consolidate with larger health systems [6]. The proposed payment correction could help reverse some of these trends, ensuring patients retain access to timely, high-quality cancer treatment within their communities. ​

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Oncology Billing Considerations Amid Policy Changes

While an increase in Medicare payments would be a positive step, oncology practices must still navigate a complex billing landscape. Even with a reimbursement boost, challenges such as prior authorization hurdles, coding accuracy, and compliance risks remain critical considerations for revenue cycle management. Practices must ensure that: ​

• Billing and coding are optimized to capture all eligible reimbursements accurately 
• Compliance remains a priority amid evolving Medicare regulations and potential audits 
• Revenue cycle management is proactive, ensuring financial stability beyond temporary policy changes

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Looking Ahead

While the proposed physician payment increase is a step toward stabilizing oncology reimbursement, long-term solutions are essential to address systemic issues within Medicare payment models. Advocacy efforts continue to push for sustainable payment structures that support the oncology workforce and ensure patient access to care [7]. 

Oncology practices should remain vigilant and stay informed on legislative updates while implementing strong revenue cycle strategies to navigate ongoing reimbursement challenges.​ We strongly recommend inviting your State and Federal Congressional Representatives and Senators to tour your cancer facilities. This initiative will raise awareness about the latest treatments available in both Medical and Radiation Oncology. Additionally, it will educate your public servants on the operational challenges you face, such as staffing shortages and rising supply costs, as well as financial hurdles like drug shortages, equipment expenses, and burdensome payer authorizations for standard care. This effort will further emphasize the issues impacting you and the community you serve. Advocacy works! ​

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By leveraging expert oncology billing support with RC Billing, practices can maximize revenue integrity and minimize disruptions regardless of policy fluctuations.

Get in touch with our team today

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References 

1. Centers for Medicare & Medicaid Services. (2024). 2025 Medicare Physician Fee Schedule Final Rule. Retrieved from https://www.cms.gov/newsroom/fact-sheets/2025-medicare-physician-fee-schedule-final-rule 
2. Fierce Healthcare. (2025). Bipartisan Lawmakers Introduce Bill Boosting Physician Pay. Retrieved from https://www.fiercehealthcare.com/providers/bipartisan-lawmakers-introduce-bill-boosting-physician-pay-66-april-through-december
3. Community Oncology Alliance. (2024). Impact of Medicare Reimbursement Cuts on Independent Oncology Practices. Retrieved from https://www.communityoncology.org/medicare-reimbursement-cuts-impact 
4. American Medical Association. (2024). Physician Payment Reform and Practice Sustainability. Retrieved from https://www.ama-assn.org/advocacy/physician-payment-reform 
5. American Society of Clinical Oncology. (2023). The Oncology Workforce Crisis: Implications for Cancer Care. Retrieved from https://www.asco.org/research-guidelines/workforce-crisis-report 
6. ASCO. (2024). Financial Challenges and Access to Oncology Care. Retrieved from https://www.asco.org/advocacy-policy/financial-challenges-oncology-care 
7. Medicare Payment Advisory Commission. (2024). Recommendations for Sustainable Physician Payment Reform. Retrieved from https://www.medpac.gov/reports/recommendations-for-sustainable-physician-payment-reform