July 27, 2026
Two Decades of Medicare Payment Declines Associated with Worsening Patient Access Gaps
A new study from the Harvey L. Neiman Health Policy Institute found that the persistent declines in Medicare physician reimbursement are associated with widening disparities in access to care, with patients in rural communities, low-income areas, and disadvantaged neighborhoods falling further behind their more urban, affluent, and advantaged counterparts. The study, based on 4.7 million unique patients over the 2005-2023 period, was published in INQUIRY: The Journal of Health Care Organization, Provision, and Financing.
The research found that over the last two decades, Medicare physician payment has lost nearly half of its value to payment cuts and inflation. As inflation-adjusted Medicare physician payment declined, patient access to care has worsened, and disadvantaged patients were most affected. Patients in rural communities, lower-income areas, and disadvantaged neighborhoods became increasingly less likely to see any physician, nurse practitioner or physician’s assistant for care than patients in more urban, affluent, and advantaged areas.
Medicare reimburses clinicians using a payment rate set by CMS, called the conversion factor. Because federal law requires Medicare spending changes to remain budget neutral, when Medicare increases spending in one area, the agency often lowers the conversion factor to offset those increases.
“The conversion factor was $37.90 in 2005 and decreased 14.6% to $32.35 in 2025,” said Eric Christensen, PhD, research director at the Neiman Institute and study lead author. “However, after accounting for inflation, Medicare physician payments have fallen 48.3% over the last two decades. In real terms, clinicians are being paid about half as much for providing the same services today as they were paid in 2005.”
The effects of declining reimbursement on clinicians and health systems have been well documented. Less understood is what happens to patients when reimbursement fails to keep pace with inflation,” explained Joshua Hirsch, MD, Incoming Chair of Radiology at Keck School of Medicine of University of Southern California and study coauthor. “Our study suggests that patient’s lose access, and the people most affected are those who already face the greatest barriers to care.”
To evaluate the relationship between reimbursement change and access disparities, the authors examined differences in access to physician care for underserved patients versus their more advantaged peers each year, and if those differences (gaps) were associated with Medicare reimbursement reductions. Specifically, the study compared access to care among patients living in small towns and rural areas versus metropolitan areas, low- versus high -income communities, and less- versus more-advantaged neighborhoods. The researchers then statistically modeled whether declining inflation-adjusted Medicare payments were associated with widening access-to-care gaps between underserved patients and more advantaged populations. The gap widened the most for low-income communities.
“Regardless of whether we looked at geography, income, or neighborhood disadvantage, underserved patients experienced growing declines in access to care as the inflation-adjusted conversion factor decreased. Access disparities widened the most for primary care, more than any other medical specialty, despite major Medicare policy efforts designed to strengthen primary care access,” explained Dr. Christensen. “These gaps cannot be explained by a transition of care to nurse practitioners and physician’s assistants, as these clinicians were included in the analysis.”
“The findings suggest that Medicare reimbursement policy is not only a physician payment issue but also a patient access issue. As payment declines, underserved patients appear to bear a disproportionate share of the consequences,” said Lauren Nicola, MD, CEO of Triad Radiology Associates, member American College of Radiology Board of Chancellors, and study coauthor. “If policymakers are serious about improving access to care, Medicare reimbursement must be viewed through the lens of patient impact.”
“Congress and CMS have policy options to help prevent further erosion of patient access, including indexing Medicare physician payment to inflation and updating outdated budget neutrality thresholds that have remained unchanged since 1992—this $20 million threshold would now be $47.3 million if inflation adjusted to today’s dollars,” said Greg Nicola, MD, board member of Hackensack Meridan Health Partners, Vice Chair American College of Radiology Board of Chancellors, and study coauthor.
To arrange an interview with a spokesperson, contact Nichole Gonzalez at ngonzalez@neimanhpi.org.
About the Harvey L. Neiman Health Policy Institute
The Harvey L. Neiman Health Policy Institute is one of the nation’s leading medical imaging socioeconomic research organizations. The Neiman Institute studies the role and value of radiology and radiologists in evolving health care delivery and payment systems and the impact of medical imaging on the cost, quality, safety and efficiency of health care. Visit us at www.neimanhpi.org and follow us on X, BlueSky or LinkedIn.