Why It Matters

Medicare pays physicians through a formula that has delivered years of effective pay cuts, eroding access to care for tens of millions of seniors. The House Energy and Commerce Subcommittee on Health is scheduled to examine that formula (and the 2015 law that governs it) on May 19, with lawmakers now facing a hard deadline: a temporary payment fix expires at year's end, and no permanent solution is in place.

The stakes extend beyond physician incomes. How Congress structures Medicare reimbursement determines whether doctors continue to accept Medicare patients, which specialists remain financially viable, and whether value-based care models actually work in practice.

A Temporary Fix Running Out of Road

The One Big Beautiful Bill Act included a one-time 2.5 percent increase to the Medicare physician fee schedule conversion factor for calendar year 2026. The law replaced an earlier House proposal that would have tied annual updates to a medical inflation index, leaving physicians with no guarantee of what comes in 2027.

The Medicare physician fee schedule hearing is designed to address that gap. The American College of Radiology confirmed the 2.5 percent bump applies only to 2026, making the current legislative window critical for anyone seeking a durable fix.

MACRA Payment Reforms Enter New Territory

Layered atop the conversion factor debate is a structural milestone in MACRA payment reforms. For the first time since the Medicare Access and CHIP Reauthorization Act was enacted in 2015, CMS is operating under a dual-track conversion factor system in 2026, with separate rates for physicians in qualifying Alternative Payment Models and those who are not.

The American Medical Association noted that MACRA requires a 0.75 percent update to the qualifying APM conversion factor and a 0.25 percent update to the non-qualifying APM conversion factor starting this year. It is the first time this century that CMS has operated with multiple conversion factors simultaneously.

Whether that bifurcated system is functioning as intended (and whether the incentive structure is actually driving physicians toward value-based care) is a central question the subcommittee is positioned to probe.

Specialty Cuts Fueling the Debate

The CY 2026 Medicare Physician Fee Schedule final rule, released by CMS on October 31, 2025, added another layer of controversy. Healthcare Dive reported that CMS locked in pay cuts for specialty physicians, normalizing reimbursement between specialists and primary care doctors while also curbing the influence of a major physician association in the rate-setting process.

That decision landed with particular force in a subcommittee that includes several physician-members, among them Dr. Mariannette Miller-Meeks, Dr. John Joyce, Dr. Neal Dunn, Dr. Kim Schrier, and Dr. Raul Ruiz. The physician reimbursement hearing gives those members a direct forum to scrutinize how the fee schedule is constructed and whether specialty medicine is being systematically undervalued.

Congress Was Already Laying the Groundwork

Earlier this year, the House issued a formal Request for Information on modernizing MACRA, drawing substantive responses from major healthcare organizations. The American Hospital Association submitted recommendations in January 2026, signaling that healthcare provider advocacy around payment reform has been building for months.

That RFI process suggests the subcommittee has been conducting deliberate pre-legislative work, using the Medicare physician fee schedule hearing as the next step toward potential legislation.

CMS Proposed Rule Adds Regulatory Dimension

CMS has also proposed a new rule aligning Medicare physician payment with both the Big Beautiful Bill provisions and MACRA's dual-track framework. Healthcare Dive described the proposed regulation as sweeping in scope but modest in its net reimbursement impact, a characterization that physician groups have contested.

The proposed rule gives the subcommittee a live regulatory target, not just an abstract policy debate. Members can examine whether CMS is implementing congressional intent correctly and whether the agency's interpretation of MACRA's payment structures aligns with what lawmakers envisioned when they passed the law more than a decade ago.

Who Is Running the Hearing

The subcommittee is chaired by Rep. Buddy Carter, with Dr. Neal Dunn serving as Vice Chair and Rep. Diana DeGette as Ranking Member. The full Energy and Commerce Committee, chaired by Rep. Brett Guthrie, has jurisdiction over Medicare payment policy broadly.

The subcommittee's membership spans both parties and includes multiple physicians, giving the Medicare payment policy discussion a clinical dimension that is less common in other committee settings. Whether that translates into bipartisan momentum for a longer-term fix (or devolves into a debate over specialty versus primary care priorities) will depend on what emerges from the fee schedule testimony and whether members can coalesce around a shared diagnosis of the problem.

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