Following a whirlwind presidential election, it’s easy to get caught up in sensational and scandalous headlines. For example, pundits and politicians have zeroed in on Department of Health and Human Services (HHS) Secretary nominee Robert F. Kennedy Jr.’s vaccine skepticism and criticism of water fluoridation. Similarly, Centers for Medicare and Medicaid Services (CMS) administrator nominee Dr. Mehmet Oz has been scrutinized for pushing dubious medical treatments.

But, this focus shouldn’t distract the public or Congress from the less flashy (but no less important) policy positions. According to a report by the Financial Times, Kennedy and Oz are considering reevaluating Medicare’s billing codes and cutting fees paid to physicians. The Medicare payment system is in dire need of reform, but any billing shifts need to be carefully considered. With a steady and balanced approach, RFK Jr. and Oz can save taxpayers and consumers from a costly Medicare bailout.

The incoming Trump administration is eager to keep physician trade groups away from the levers of power. The truth is that doctors have already been losing their clout at the CMS. The agency’s recently finalized Medicare Physician Fee Schedule rule trims Medicare physician payments by 2.9% for 2025. Similarly, the agency lowered physician payments by 3.4% in 2024. According to an analysis by the American Medical Association, Medicare payments to physicians have decreased by 29% since 2001 after adjusting for inflation. Further reductions in reimbursements could result in doctors shifting Medicare patient expenses onto patients paying with private insurance, and potentially even hospital closures.

Fortunately, there are other ways to reform Medicare billing codes without further slashing doctor reimbursements. For example, CMS has started allowing reimbursement for digital therapeutics used as part of behavioral health treatments.

While this is an important step in the right direction, Medicare reimbursement policies remain far too limited for patients to benefit from digital treatments currently in the marketplace. As Stat News reported, “While the FDA has cleared over 20 software-based medical treatments [i.e., digital therapeutics], only a handful of them would fall under the new regulation.” Given that digital treatments can improve patient well-being at a fraction of the cost of traditional treatments, CMS should consider expanding coverage to all FDA-cleared digital therapeutics.

The HHS and CMS should also work with lawmakers to implement site-neutrality in Medicare payments. Medicare creates considerable waste by reimbursing different amounts of money for the same services rendered at different types of health care facilities. It makes little sense that taxpayers pay 141% more for the first hour of chemotherapy in a hospital than that same hour at a doctor’s office. Hospital outpatient departments can bill Medicare more than $1,000 for an echocardiogram, a service that costs taxpayers just $350 at a doctor’s office.

In a 2022 report to Congress, the Medicare Payment Advisory Commission stated the obvious: “Medicare should base payment rates on the resources needed to treat patients in the most efficient setting.

If the same service can be safely provided in different settings, a prudent purchaser should not pay more for that service in one setting than in another.” Even though successive presidential administrations have advocated for reform, change remains elusive. Sens. Bill Cassidy of Louisiana and Maggie Hassan of New Hampshire have been leading the charge in Congress for site-neutral Medicare payments, and allies in the new administration could get the proposal across the finish line.

There’s more than one way to cut Medicare spending and save taxpayers from a fiscal calamity. RFK Jr., Oz and lawmakers must work together to reform Medicare’s unwieldy billing system and bring some much-needed sanity to the struggling program.

David Williams is the president of the Taxpayers Protection Alliance.