Payment Policy Changes

Orthopaedic surgeons and the physician community are constantly facing cuts to Medicare reimbursement. In 2022, those combined cuts added up to nearly 10% of reimbursement. AAOS advocated fiercely against them and in December 2021, President Biden signed legislation that effectively decreased the cuts from 10% to 2.5% in 2022. AAOS was pleased to see Congress take action to mitigate the cuts before the end of the year, but it was only a temporary fix to Medicare's broken payment system.

Now CMS is again calling for a nearly 4.5% cut starting on Jan. 1, 2023. This is in addition to a looming 4% cut to physician reimbursement due to a congressionally mandated budget mechanism known as PAYGO. Without congressional action, orthopaedic surgeons and most physicians will experience an 8.5% cut to Medicare reimbursement starting Jan. 1, 2023.

Accounting for inflation and practice costs, physician payment in Medicare has decreased 20% over the past 20 years. The Medicare Physician Fee Schedule does not have a budgetary mechanism to account for inflation, while other groups that receive Medicare reimbursement, like hospitals, do. The fee schedule is also subject to congressionally-mandated budget neutrality requirements. AAOS is working to reform these budget neutrality rules. payment processes, and is supportive of the American Medical Association’s Characteristics of a Rational Medicare Payment System that were released in May 2022.


We will continue to advocate for long-lasting reforms that will help our members and improve patient access to care (see full AAOS statement).