Physician Reimbursement

Why Your Medicare Doctor Is Disappearing

The federal government is cutting physician reimbursement every year while costs go up. The math eventually wins.

There's a quiet crisis building in American healthcare that doesn't get much coverage. It's not a new disease or a drug shortage. It's arithmetic.

What Medicare Actually Pays

Here's a concrete example. A Well Women Exam — a standard preventive visit — takes roughly 30 minutes to perform. A physician bills $250 for that visit. Medicare reimburses $32.

This year, that reimbursement is scheduled to drop another 4 percent. Next year it will be closer to $30.

Meanwhile, everything else a medical practice pays for is going up. Rent, utilities, malpractice insurance, licensing fees, software, staff wages — all climbing at 8, 10, 15 percent annually. The reimbursement rate moves in the opposite direction.

At $30 for a 30-minute visit, you're looking at an effective billing rate of $60 an hour before a single expense is paid. After overhead — which in a typical medical practice runs 60 to 70 percent of revenue — what remains doesn't constitute a living wage by any reasonable definition. We're talking about take-home pay in the range of $20,000 to $30,000 a year for a physician carrying years of medical training and the weight of a federal regulatory burden that doesn't get lighter.

For context: a skilled trades position at a manufacturing facility currently pays more than that.

Why Physicians Can't Fight Back

The obvious response to this situation — the same response any other profession would have — is to organize. Refuse to accept the rate. Negotiate collectively.

Physicians cannot do this.

The legal classification is "public trust." The logic: society depends on physicians in a way it doesn't depend on most professions. Without doctors, patients die. That dependence means physicians are treated like utilities — essential services subject to rate regulation — rather than independent professionals with the right to negotiate.

Teachers can form unions. Electricians can form unions. Physicians who attempt to coordinate on pricing face federal antitrust exposure: price fixing, racketeering charges, potentially worse. The regulatory framework that protects patients from price gouging also, as a practical matter, prevents the profession from pushing back when the government decides to pay less.

The utilities comparison is instructive in one way, though: when an electric company needs a rate increase, it can petition a regulatory board. There's a process. For physicians, there is no equivalent mechanism. The rate is what the rate is, and it goes in one direction.

Where This Leads

Medicare applications to medical schools are declining. The pipeline of physicians who intend to accept Medicare is getting smaller. This is a rational response to an irrational economic arrangement, and the consequences are predictable.

Within a decade, finding a physician who accepts Medicare or Medicaid in many parts of the country is going to be significantly harder than it is today. Not because doctors stopped caring about their patients. Because the economics of treating those patients became unsustainable.

The patients who will feel this first are the ones who can least afford a different option.

Why I'm Still Doing This

I'm not telling you this to complain. I'm telling you because I think people deserve to understand the system they're navigating.

I also can't retire. Not because I'm not ready — but because I see what's coming, and someone has to keep doing the work. That's the honest answer.

What I can tell you is this: the more independent you can become of that system — the fewer chronic conditions you're managing, the fewer specialists you need, the fewer prescriptions you're filling — the less this particular crisis touches your life.

That's still the most direct path through it.

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