2025 Proposed Medicare Physician Fee Schedule

Continuing cuts embolden AADA to demand Medicare payment reform

On July 10, CMS released the 2025 Medicare Physician Fee Schedule (MPFS) proposed rule, which included important policy changes to fee-for-service payments and the Quality Payment Program (QPP). The AADA strongly opposes these cuts and demands that Congress reform the Medicare physician payment system by adding an annual inflation adjustment and modifying budget neutrality requirements.

For 2025, CMS is proposing a conversion factor of $32.3562, which is about a 2.8% reduction from the final 2024 conversation factor of $33.2875. The proposed 2025 conversion factor is due to the expiration of the 2.93% payment bump provided by Congress for 2024 plus a budget neutrality adjustment of 0.05%.

CMS’s specialty impact estimates do not account for the removal of the temporary 2.93% payment increase for 2024. As a result, instead of the 0% impact on dermatologists as reported by CMS, the AADA anticipates an impact closer to a 2.8% cut for dermatology. However, individual practitioner outcomes may vary based on their specific practice mix.

The AADA evaluated the impact on dermatologic codes. The proposed payment rates for each code reflect the impact of various policy changes related to physician work, practice expense, and malpractice relative value units (RVUs).

2025 MPFS key proposals include:

• Continuing some telehealth flexibility, including allowing physicians to report their currently enrolled practice location instead of their home address when providing telehealth services from their home.

• CMS disagreeing with the RUC-recommended values for CPT codes 96920 – 96922 (Excimer laser treatment for psoriasis) and proposing lower work Relative Value Units (RVUs) of 0.83, 0.90, and 1.15 respectively.

• Introducing a new MIPS Value Pathway (MVP) for dermatology called “Dermatological Care,” despite AADA objections, which would be available for voluntary reporting in the 2025 performance year/2027 payment year. The AADA is committed to helping our members prepare for CMS’s planned transition from MIPS to MVPs. The AADA will continue to advocate to ease the reporting burden for dermatologists.

• Maintaining the MIPS performance threshold at 75 for the 2025 performance year/2027 MIPS payment year.

• Proposing a new MIPS dermatology quality measure for the 2025 performance period and future years — Melanoma: Tracking and Evaluation of Recurrence (High Priority; Outcome).

• Removing MIPS Measure 137, Melanoma: Continuity of Care – Recall System for performance year 2025 and beyond.

The AADA staff is reviewing the 2,000+ page rule and working with Academy leaders to submit comments to CMS in response to the proposals. We will prepare an analysis of the policies that will be featured in upcoming issues of DermWorld Weekly and on AAD.org. For more information, please review the proposed rule (PDF), the Medicare Physician Fee Schedule fact sheet, and the QPP fact sheet.

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