Independent physicians, particularly in rural communities, have spent years navigating a steady stream of financial cuts, rising costs, and policy instability. Over time, these pressures have forced difficult decisions: scaling back services, reducing staff, and in too many cases, closing care centers altogether.
While there has been modest, temporary relief through adjustments in the Physician Fee Schedule (PFS), it has not been enough to reverse the broader trend. Many practices remain on the edge, operating on razor-thin margins, uncertain whether they can continue year to year. Without meaningful, structural reform, rural care is not just strained, it is on the cliff of collapse.
Independent medical practices, the backbone of care delivery in many rural areas, are declining at a significant rate. Financial pressures, driven largely by inadequate reimbursement, are forcing physicians to close practices, retire earlier than planned, or sell to larger health systems. This trend has serious implications not only for physicians, but for the patients and communities who rely on accessible, local care.
The growing imbalance in Medicare reimbursement
At the center of this challenge is a growing imbalance between the cost of providing care and the payments physicians receive. Reimbursement rates, particularly through Medicare, have not kept pace with rising expenses. In many cases, payments for common services fall below the actual cost of delivering them. At the same time, operating costs, staffing, supplies, technology, and compliance requirements, continue to increase.
The consequences are especially pronounced in rural areas, where patient volumes are lower and margins are already thin. When an independent practice closes, patients often face longer travel distances, delayed care, and fewer choices. Preventive services may be deferred, and conditions that could have been managed early in a local clinic may ultimately require more costly treatment in hospital settings.
This shift is not only burdensome for patients; it is also inefficient for the health care system as a whole. Care delivered in independent physician offices is frequently more cost-effective than the same services provided in hospital-based settings. Preserving these practices is therefore aligned with broader goals of controlling costs and improving access.
A legislative path forward for independent practices
There is, however, a path forward. The 2026 PFS Final Rule was the first meaningful improvement for office-based providers in years, and helped prevent many office-based facilities from facing closure. Prior to the 2026 Indirect Practice Expense policy, office payments had been declining every year through 2025. Additionally, a recently introduced bill, H.R. 7863, the Promoting Fairness for Medicare Providers Act, offers a pragmatic and targeted solution. The legislation, which was introduced in March 2026, would establish a more accurate payment model for high-cost, supply-intensive procedures performed in physician offices, aligning reimbursement more closely with actual costs while still maintaining savings for Medicare.
By tying practice expense payments to a percentage of ambulatory surgery center (ASC) rates and using updated, auditable cost data, this approach would help stabilize independent practices, reduce incentives for unnecessary consolidation, and preserve access to care, particularly in rural and underserved communities where alternatives may not exist.
While recent policy discussions at the federal level offer a measure of cautious optimism, policymakers must recognize that reimbursement policy is not an abstract financial mechanism, it directly shapes whether patients can access timely, local care. Additionally, without permanent and structural changes, this positive trend forward will only be temporary.
Independent physicians are not seeking preferential treatment. Rather, they are asking for a system that reflects economic reality and supports the continued delivery of high-quality care in community-based settings. The future of our health care system depends on it.
James Albert is a cardiothoracic surgeon and phlebologist.
