The shrinking dollar: Inflation's toll on oncology physician reimbursement.

21 Background: The Medicare Physician Fee Schedule (MPFS) serves as the primary mechanism for reimbursing physicians for services provided to Medicare beneficiaries and is used as the basis for reimbursing physician services by other insurers. However, the MPFS lacks a consistent inflation adjustment, leading to concerns about the sustainability of physician reimbursement over time. We examined trends of MPFS for oncology related services and compared them against the Consumer Price Index (CPI), a measure of general inflation trends. Methods: Using publicly available MPFS data from the Centers for Medicare & Medicaid Services (CMS) and CPI data from the Bureau of Labor Statistics (BLS) for 20 years from 2005 to 2025, we analyzed and compared historical trends and compound annual growth rate (CAGR) of the CPI with the MPFS (actual and inflation-adjusted) for 298 procedure codes frequently used in oncology, including evaluation and management (E&M) services, chemotherapy and therapeutic drug administrations, radiation oncology services, and select diagnostic/therapeutic procedures and services. Results: CPI increased 66.6% from 2005 to 2025. For the same period, the medical care inflation, a measure of practice cost inflation (operating expenses) rose 77.4%. On the contrary, the per-service MPFS payments increased by 3.5% for oncology related services (-0.23% CAGR) in the same time period. Inflation-adjusted per-service MPFS payments decreased by 25.4% for oncology related services (-2.6% CAGR). Trends reveal that the MPFS has consistently lagged behind the CPI, with physician reimbursement rates growing at a significantly lower pace and taking significant reductions than general inflation. Conclusions: The widening gap between reimbursement rates and inflation suggests exacerbating financial pressure on oncology practices. The lack of an inflation adjustment in the MPFS has resulted in a persistent decline in oncology specific physician reimbursements, undermining the financial sustainability of oncology practices and threatening access to high-quality cancer care. The proposal of tying inflationary adjustments to the Medicare Economic Index should offer some improvement, although incremental adjustments alone will remain insufficient. However, future research should explore the oncology specific economic and healthcare implications of this or other proposed changes. MPFS trends. Service Type (# of Codes) MPFS Trend (2005-2025) Inflation Adjusted MPFS (2005-2025) % Change CAGR % Change CAGR E&M Services (36) 14.4% 0.57% -30.1% -1.8% Radiation Therapy (106) 7.4% 0.06% -21.1% -2.31% Chemotherapy administration (35) -20.1% -1.48% -49.9% -3.8% Therapeutic drug administration (53) -9.9% -1.01% -30.3% -3.23% Select diagnostic/therapeutic procedures & services (68) 6.3% -0.26% -20.4% -2.75% Total (298) 3.5% -0.23% -25.4% -2.6%