Deeper Dissection #6

Enter the PFS

The open-ended payment system, where CMS reimbursed doctors based on “reasonable and customary” charges, had little natural downward cost pressure. Once a doctor raised prices, that became the new benchmark. Today’s inflated rate became tomorrow’s “customary” price. And with patients shielded from costs and CMS obligated to pay, neither side had any reason to push for lower prices.