In January 1992, the federal government implemented a package of physician payment reforms for use in the Medicare program. Among these reforms is a resource-based fee schedule that replaces the customary, prevailing, and reasonable (CPR) method of payment that has been used since Medicare's inception. This article describes the recommendations of the Physician Payment Review Commission, a Congressional advisory group, concerning the implications of the resource-based fee schedule on nurse practitioners and other non-physician practitioners. Absent changes in current law, services provided by nurse practitioners will be paid based on the same formulas that were used under CPR. This author advises that these payment formulas be revised to reflect the differences in resource costs borne by physicians and nonphysicians. Furthermore, revisions to the payment formulas should be made in the near future before the Medicare fee schedule and the rules governing its use are adopted by other public (e.g., Medicaid) and private payers.