President Trump finalizes spending bill with 2.5% rad pay bump, but no inflation-based Medicare reform
President Donald Trump on Friday signed his administration’s signature tax-cut and spending bill into law. The final measure includes a 2.5% pay bump for physicians in 2026 but leaves out larger reforms to tie doc pay increases in the Medicare program to inflation.
Meanwhile, the bill also includes some $1 trillion in Medicaid cuts, with nearly 12 million kicked off insurance, drawing criticism from the American Medical Association and hospital lobbying groups. The U.S. House first passed its original version of the bill May 22 with annual physician pay updates linked to the Medicare Economic Index, a measure of inflation. However, the Senate stripped this provision in its own version passed July 1, settling on only the one-time increase for 2026.
“The inclusion of an updated Medicare Physician Fee Schedule conversion factor in this bill is a step forward,” Cindy R. Moran, American College of Radiology executive vice president of government relations and health policy, said in a statement July 3. “We look forward to working with CMS, regulators, lawmakers and other stakeholders to arrive at a sensible long-term physician payment plan that supports practices’ ability to continue to provide care in their communities and enables greater patient access to lifesaving care.”
Some additional reactions from key healthcare stakeholders:
- “This bill will have significant long-term impacts on providers, particularly with respect to Medicaid. The final product rejects a potentially workable framework to end the chronic cycle of patchwork MPFS fixes that forces providers to repeatedly plead for temporary relief days before cuts are implemented,” Kit Crancer, chair of the RBMA's Radiology Patient Action Network, told Radiology Business July 6. “Congress is ignoring MedPAC recommendations and dismissing clear data from the Radiology Business Management Association and others showing that the current MPFS rate spiral is hurting access to care and accelerating consolidation. We stand ready to keep working with members of Congress to produce serious, lasting solutions. They need to start keeping their promises to America’s healthcare providers and the patients they serve.”
- “Today is a sad and unnecessarily harmful day for patients and healthcare across the country, and its impact will reverberate for years,” Bobby Mukkamala, MD, president of the American Medical Association said July 3. “Care will be less accessible, and patients may simply forego seeing their physician because the lifelines of Medicaid and CHIP are severed. This is bad for my patients in Flint, Michigan, and it is devastating for the estimated 11.8 million people who will have no health insurance coverage as a result of this bill. The American Medical Association’s mission is promoting the art and science of medicine and the betterment of public health. This bill moves us in the wrong direction. It will make it harder to access care and make patients sicker. It will make it more likely that acute, treatable illnesses will turn into life-threatening or costly chronic conditions. That is disappointing, maddening and unacceptable.”
- “Today is an extremely disappointing and very difficult day for healthcare in America,” Rick Pollack President and CEO American Hospital Association said July 3. “Despite months of clearly demonstrating the implications that these Medicaid proposals will have on the patients and communities we serve, especially the most vulnerable populations, Congress has enacted cuts of nearly a trillion dollars to the Medicaid program. No matter how often repeated, the magnitude of these reductions—and the number of individuals who will lose health coverage—cannot be simply dismissed as waste, fraud and abuse. The faces of Medicaid include our children, our disabled, our seniors, our veterans, our neighbors, and friends. The real-life consequences of these reductions will negatively impact access to care for all Americans. The AHA remains committed to working with all stakeholders to mitigate the impact of these cuts wherever possible. Our goal is to help ensure hospitals can remain open for their communities, and people can get the care they need when they need it. Our nation’s health and economic future depend on it.”
- "After over a year of diligent work crafting a budget reconciliation package that extends the successful 2017 tax cuts, strengthens border security and our military, and cuts waste, fraud, and abuse, I was proud to support the final passage of H.R. 1, the One Big Beautiful Bill Act," Rep. Greg Murphy, MD, R-N.C., said July 3. "As a physician of over 30 years serving rural eastern North Carolina, and as a member of the House Ways and Means Committee, I vigorously advocated for a package that protects hardworking families, helps our country flourish, and preserves the fiscal viability of the United States. We achieved this and more while delivering on President Trump's and Republicans' vision to put the American people first. The Medicaid system, as we now know it, is broken. It desperately needs reform so that it can be a strong program for those who are eligible to receive the benefits. Throughout the bill-making process, I engaged in innumerable dynamic and spirited conversations with the Trump administration to protect rural patients, doctors and hospitals. As the only individual in Congress who continues to see patients covered by Medicaid, I have firsthand knowledge of how this program impacts our communities. This bill protects Medicaid benefits for those who are most vulnerable in our society, not able-bodied individuals capable of participating in the workforce, illegal immigrants and those ineligible for benefits. The $50 billion Rural Health Transformation Program, included in the package, ensures the sustainability of rural health providers with an immediate impact beginning next year. I look forward to working with President Trump and CMS Administrator Oz, as well as healthcare leaders across the beautiful State of North Carolina, on the successful implementation of this law."
- “The Senate recently passed the One Big Beautiful Bill Act that would make sweeping changes to Medicaid and the ACA Marketplaces resulting in significant coverage losses for rural Americans. This legislation will limit access to care for all rural patients by ending health care coverage for rural residents nationwide and putting financial strain on rural facilities who care for them. The National Rural Health Association is extremely concerned by the Senate’s cuts to provider taxes and state-directed payments which directly support rural providers and facilities,” Alan Morgan, CEO of the NRHA, said July 1. “Further, NRHA is concerned that the Rural Health Transformation Program, dedicated to offset the Medicaid cuts on rural communities, will fall short of addressing the other provisions in this legislation. We urge our partners in the House to reject these massive cuts and protect rural healthcare.”
- “The One Big Beautiful Bill Act includes changes that raise serious concerns for the breast cancer community,” Paula Schneider, Susan G. Komen president and CEO, said July 3. “Access to affordable, timely healthcare is critical—not only for those newly diagnosed, but also for those living with and beyond breast cancer. Policies that make it harder to secure coverage or navigate the system risk delaying care when every day counts. We urge our leaders to do better for the breast cancer community who depend on timely, affordable care.”
Marty Stempniak has covered healthcare since 2012, with his byline appearing in the American Hospital Association's member magazine, Modern Healthcare and McKnight's. Prior to that, he wrote about village government and local business for his hometown newspaper in Oak Park, Illinois. He won a Peter Lisagor and Gold EXCEL awards in 2017 for his coverage of the opioid epidemic.