Medicare Should Pay Docs More, Cut Nursing Home and Home Health Pay, MedPAC Says

— Better data needed from Medicare Advantage plans, MedPAC tells Congress

June 15, 2026

• 3 min read

The Medicare Physician Fee Schedule should increase each year tied to the rate of medical inflation, while payments for inpatient rehabilitation and home healthcare should be cut, the Medicare Payment Advisory Commission (MedPAC) reiterated Monday in its June report to Congress.

"To bring fee-for-service Medicare's overall payment levels closer in line with providers' costs, the commission ... recommends slightly increasing (above current law) payment rates for the hospital outpatient and inpatient prospective payment systems and the Physician Fee Schedule, modestly decreasing payment rates for outpatient dialysis services and hospice services, and substantially decreasing payment rates for post-acute care providers (i.e., skilled nursing facilities, home health agencies, and inpatient rehabilitation facilities, which have high Medicare profit margins of 24%, 21%, and 17%, respectively)," the authors wrote, hearkening back to recommendations from MedPAC's March 2026 report.