AMA Criticizes Medicare Pay Cuts & G-Codes

The AMA expressed concerns that the proposed cuts would occur despite a projected 3.6% rise in medical practice costs for physicians.

The American Medical Association (AMA) has strongly opposed the Centres for Medicare & Medicaid Services (CMS) proposed 2.8% reduction in physician payments for the 2025 calendar year. 

The AMA expressed concerns that the proposed cuts would occur despite a projected 3.6% rise in medical practice costs for physicians.

In its feedback on the draft 2025 Medicare Physician Fee Schedule (PFS), the AMA highlighted the discrepancy between the cost of delivering care and the proposed payment rates. 

“CMS must be fully transparent with the public about the impact of these payment cuts by including the expiration of temporary statutory increases to the conversion factor in the specialty impact table,” the AMA stated. 

The association further urged the Biden-Harris Administration to collaborate with Congress to implement a permanent, annual inflation-based update to Medicare physician payments.

Exclusion of Telehealth Codes

The AMA also criticized CMS for excluding telehealth evaluation and management (E&M) codes, which it created in March 2023. These codes were designed for both audiovisual and audio-only telehealth services. The AMA argued that the inclusion of these codes would provide a consistent approach for recognizing newer telehealth modalities.

The association suggested that the proposed telehealth E&M codes should be compensated at approximately 30% of in-office E&M services. 

“AMA created the distinct telehealth code set in March 2023 for new and established patients to be seen via audio-visual and audio-only telehealth. The code set would provide a consistent mechanism for all payers to recognize the newer modalities of synchronous audio-video and audio-only E/M services,” the comment letter explained.

Concerns Over G-Codes

In addition to the pay cuts and telehealth issues, the AMA voiced concerns about including G-codes for behavioral health and digital mental health treatment devices. The proposed G-codes are intended for new digital therapeutics and behavioral health interventions.

AMA CEO and Executive Vice President James Madara addressed CMS directly, expressing dissatisfaction with the increasing number of proposed G-codes and their potential to confuse providers. 

“The AMA sees a problem writ large with CMS’ growing number of requested revisions and clarifications to newly created Current Procedural Terminology (CPT) codes and the increase in proposed G-codes. CMS should provide comments on new codes at this time and avoid creating duplicative G-codes through the physician fee schedule process,” Madara said.

The AMA also took issue with the specific G-codes proposed for safety planning interventions (SPI) for patients in crisis. 

It argued that existing transitional care or discharge day management codes could be adapted to meet CMS’s objectives without introducing new G-codes. 

“We are not sure that this distinction is necessary as the existing CPT terminology conforms with, and relates to, medical devices supported by ample evidence,” the AMA’s letter noted.

Despite these criticisms, the AMA acknowledged several positive aspects of the draft rule. The association supported CMS's proposal to extend telehealth flexibilities, including permanent payments for audio-only telehealth services. 

It also welcomed CMS's proposal to remove productivity standards for rural health clinics and federally qualified health centers (FQHCs), which would enable these facilities to offer a broader range of services, including specialty and behavioral health care.