Starting Monday, doctors receiving Medicare and Medicaid patients will receive a 21 percent pay reduction.
The Senate on Friday failed to repeal a bill that would cut pay for doctors receiving Medicare patients by 21 percent. The payment cut applies to members of the military on the government's TRICARE program as well.
"This drastic cut will hurt our senior, disabled, and military patients, as well as baby boomers who start entering the Medicare program next year," said American Medical Association (AMA) President J. James Rohack in a statement.
According to the AMA, steep cuts will force physicians to scale back on the number of Medicare patients they treat or to possibly drop out of the program entirely.
A 2010 survey found that over 60 percent of neurosurgeons have reduced the number of Medicare patients in their practices.
On Friday, the AMA issued a brusque statement telling the Senate to stop playing games with physicians and seniors.
"The Senate had more than a year to repeal the formula and ensure the security and stability of Medicare and TRICARE, but that opportunity has been squandered," said Rohack in the statement. "It is shocking that the Senate would abandon our most vulnerable patients, making them the collateral damage of their procedural games."
An annual fee reduction beginning in 2002 was created by Congress in 1997 to reduce the amount of government spending but the cut has been continually delayed by lawmakers.
The 21 percent reduction is the largest faced by Medicare yet. In 2008, a Medicare cut of 10.6 percent went into effect, but was later repealed by Congress.