Kennedy on the Medicare Doctor Pay Cut: 'Watch What People Do, Not What They Say' (February 15, 2023)

On February 15, 2023, Sen. John Kennedy of Louisiana went to the Senate floor to answer President Biden’s charge that Republicans wanted to hurt Medicare. The president, Kennedy argued, had “tried to cut Medicare himself” by reducing what Medicare pays doctors [1]. His evidence was the 2023 Medicare physician fee schedule and a bill of his own that he said would have prevented the cut. This video shows part of that speech. Quotes are from the Congressional Record [1].

Key Moments

”Watch what people do, not what they say”

Kennedy explained that the Centers for Medicare and Medicaid Services (CMS) sets an annual fee schedule for doctors who treat Medicare patients: “They tell the physicians that this is what you can charge and not a penny more.” “President Biden’s CMS, last year, proposed to cut all physician payments, all provider payments by 4.5 percent,” he said. “He didn’t want to lift up Medicare; he wanted to cut it—not Republicans, the President.” Many physicians, he said, already refuse Medicare or Medicaid patients because fees are “not keeping up” with inflation. Speaking for them, he said: “We are paying more in rent. We are paying more for our nurses. We are paying more for supplies.” He added that the cut would reach “900,000 people in my State” who are in the program. “Watch what people do, not what they say."

"I found $9.8 billion sitting in a fund”

Kennedy said he introduced the Protecting Medicare Patients and Physicians Act, filed in December 2022 as S. 5194 [6], to eliminate the cut, and that he offered a way to pay for it rather than borrow: “I found $9.8 billion sitting in a fund at the Department of Health and Human Services. … It was called the Provider Relief Fund.” Congress had given health care providers money to cope with COVID, he said, and “not all of the money, thankfully, was needed. Many of the healthcare providers returned some of the money."

"Your bill, Kennedy, is unnecessary”

When Kennedy sought unanimous consent to pass the bill, the Finance Committee’s chairman, Sen. Ron Wyden of Oregon, objected. In Kennedy’s account, Wyden told him that Democrats were writing a year-end spending bill, the omnibus, that would “address that problem,” and that “your bill, Kennedy, is unnecessary.” “I am not blaming this on Chairman Wyden,” Kennedy said. But when he read the omnibus after it passed, he found “a 2-percent cut for every provider, every physician, who treats a Medicare patient in America. … That is better than a 4-percent cut, but it is still a cut at a time of raging inflation."

"He already did it”

Kennedy said he did not know what had happened to the unspent relief money: “It got spent on something, but it didn’t get spent on helping Medicare doctors and patients. They got cut 2 percent.” He closed by returning to the president’s charge: “The President can try to blame the Republicans and say: Well, they don’t want to seriously negotiate about controlling spending and controlling debt. All they want to do is cut Medicare. He already did it. He did it in December.”

Background: How Medicare Pays Doctors

Medicare pays physicians using a dollar amount called the conversion factor, multiplied by the value assigned to each service. In its final rule for 2023, CMS set the conversion factor at $33.06, “about 4.5% lower than the 2022 amount,” according to the American Academy of Family Physicians [2][3].

The Record

The 4.5 percent cut. CMS’s final rule for 2023 set the conversion factor about 4.5 percent below the 2022 amount, the cut Kennedy described [2][3].
The omnibus still left a cut. The Consolidated Appropriations Act, 2023, added 2.5 percent to the 2023 conversion factor, raising it to $33.8872, which still left doctors facing a cut of about 2 percent [4].
Who passed it. The Senate approved the omnibus on Dec. 22, 2022, by 68–29. Forty-eight Democrats, 2 independents and 18 Republicans voted yes; 29 Republicans, including Kennedy, voted no [5].
The relief money. Kennedy put the returned, unspent money in the Provider Relief Fund at $9.8 billion and said it may have reached $15 billion [1].

What Happened Next

Doctors’ Medicare payments kept falling, and Congress kept partly patching them, according to the American Medical Association’s history of the conversion factor [4]:

2024: a 3.37 percent cut took effect January 1, lowering the conversion factor from $33.8872 to $32.7442. A spending law signed March 9 restored part of it, raising the factor to $33.2875 for services from March 9 through December 31.
2025: a 2.83 percent cut, to $32.3465, largely from the expiration of a 2.93 percent temporary update.
2026: an increase of about 3.3 percent for most physicians, to $33.4009, which included a temporary one-year 2.5 percent update enacted in H.R. 1, the budget law President Trump signed on July 4, 2025 [4][7].