CMS on July 14 issued a proposed rule outlining Medicare Part B payment policy changes for physicians and other practitioners under the calendar year 2027 Physician Fee Schedule, with changes proposed to take effect Jan. 1, 2027. Here are nine things to know.
1. The proposed rule sets two separate conversion factors, as required by statute beginning in 2026: one for physicians who qualify as participants in an advanced alternative payment model, and one for those who do not.
2. The proposed conversion factor for non-qualifying APM participants is $32.84, a decrease of $0.56, or 1.68%, from the current $33.40.
3. The proposed conversion factor for qualifying APM participants is $33.17, a decrease of $0.40, or 1.19%, from the current $33.57.
4. The proposed decreases stem largely from the scheduled expiration of a temporary 2.50% conversion factor increase Congress attached to CY 2026 payments under the Working Families Tax Cut legislation. Without it, statutory updates alone would add 0.75% for qualifying APM participants and 0.25% for nonqualifying participants, plus an estimated 0.53% adjustment tied to proposed changes in work relative value units.
5. CMS proposed reducing payment when a physician bills a separately identifiable office or outpatient evaluation and management visit on the same day as a 0-, 10- or 90-day global procedure. Under the proposal, the costlier of the two services would be paid at 100%, while the other would be paid at 50%.
6. CMS proposed converting the G2211 evaluation and management complexity add-on code into a modifier, increasing payment for the associated E/M code by 16%. A separate proposed modifier for practitioners in Shared Savings Program or LEAD Model ACOs would increase payment by 32%.
7. CMS proposed a multiyear shift away from relying on American Medical Association survey data to set practice expense relative value units, moving toward what the agency described as more objective, routinely updated cost data.
8. CMS proposed sunsetting traditional Merit-based Incentive Payment System reporting beginning with the 2029 performance period, transitioning clinicians toward specialty-focused MIPS Value Pathways. MIPS eligible clinicians would have until the end of 2028 to make the switch unless they participate in a MIPS APM and report through the APM Performance Pathway. CMS also proposed three new MVPs, covering diabetes, hypertension and hospital-based care, which the agency said would extend a relevant reporting option to about 98% of specialties.
9. The proposed rule would introduce new MIPS Core Measures beginning in 2027, requiring every clinician to report at least one measure considered fundamental to their specialty. CMS also proposed changing how it calculates the Advanced APM incentive payment to close what it called a loophole, one the agency estimates could otherwise generate $2.38 billion in windfall payments over the next decade to clinicians who don’t participate in APMs. The rule is open for public comment before a final version is issued later this year.
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