CY 2027 Medicare Physician Fee Schedule: Proposed Rule Explained

The Centers for Medicare & Medicaid Services (CMS) released the CY 2027 Medicare Physician Fee Schedule (MPFS) proposed rule on July 14, 2026.

This is a proposed rule, not a final rule — it outlines planned changes to Medicare Part B physician reimbursement for services provided on or after January 1, 2027.

Public comments close September 14, 2026, and CMS is expected to publish the final rule around November 1, 2026.

Quick Summary:

• Proposed CY 2027 conversion factors are lower than 2026, due mainly to the expiration of a temporary statutory pay bump
• CMS wants to fold the E/M complexity add-on code G2211 into a percentage-based modifier
• A new proposal would cut payment 50% when an E/M visit and a global-period procedure happen the same day
• Remote patient monitoring (RPM) and remote therapeutic monitoring (RTM) billing rules would tighten significantly
• The rule also touches practice-expense methodology, MIPS, telehealth, and advance care planning

What Is the Medicare Physician Fee Schedule?

The Medicare Physician Fee Schedule (MPFS) is the annual system CMS uses to set payment rates for physician and other practitioner services billed under Medicare Part B.

Each year’s fee schedule is built from Relative Value Units (RVUs), a Geographic Practice Cost Index (GPCI), and a nationwide conversion factor that translates RVUs into a dollar amount for each CPT and HCPCS code.

CMS updates the fee schedule through a rulemaking process: a proposed rule in mid-year, a public comment period, and then a final rule that typically publishes in late fall ahead of the new calendar year.

Proposed CY 2027 Conversion Factors

CMS proposes two separate conversion factors for CY 2027, a structure required by statute for clinicians who participate in Qualifying Alternative Payment Models (APMs) versus those who don’t.

CMS attributes most of the projected decrease to the scheduled expiration of a one-time 2.5% statutory payment increase that applied only to CY 2026.

The proposed statutory update for 2027 is smaller — +0.75% for qualifying APM participants and +0.25% for everyone else — and is partly offset by an estimated +0.53% budget-neutrality adjustment tied to proposed work-RVU changes.

It’s worth remembering that a conversion factor is not a per-service payment amount. What a specific clinician actually collects for a specific CPT code still depends on that code’s RVUs, the local GPCI, place of service, and any applicable modifiers.

Key Proposed Policy Changes

G2211 E/M Complexity Add-On Overhaul

CMS proposes retiring HCPCS code G2211 as a standalone add-on and converting it into a modifier attached to the base evaluation and management (E/M) code instead.

• A general modifier would raise the associated E/M payment by 16%
• A second, ACO-specific modifier would provide a 32% increase for eligible clinicians in arrangements like the Medicare Shared Savings Program or the LEAD Model
• Use of the ACO-related modifier would be voluntary

CMS says shifting to a percentage-based approach keeps the payment bump proportional across every level of E/M coding, rather than applying one flat dollar amount regardless of visit complexity.

Modifier 25 and Global Surgery Overlap

When the same practice bills a separately identifiable E/M visit and a procedure with a 0-, 10-, or 90-day global period on the same day, CMS proposes paying only the higher-valued service at 100%, with every other same-day surgical or E/M service paid at 50%.

CMS frames this as closing a gap where practices may effectively be paid twice for overlapping same-day work.

Remote Patient Monitoring (RPM) and Remote Therapeutic Monitoring (RTM)

Following scrutiny from the HHS Office of Inspector General, CMS proposes tightening RPM and RTM billing rules:

• Monitoring staff must be direct employees of the billing practice — outsourced or third-party monitoring vendors would no longer qualify
• Remote therapeutic monitoring would generally be limited to established patients
• A separate, billable initiating visit would be required before monitoring starts
• CMS proposes revaluing several monitoring codes, citing lower-than-expected device costs, and is asking for comments on consolidating the RPM/RTM code set into new G-codes

Practice Expense (PE) Methodology

CMS proposes moving away from older specialty-specific practice-expense-per-hour data — some dating back to 2007 or earlier — toward more current, auditable inputs.

The proposal introduces a practice-expense stabilizer meant to smooth out short-term swings in payment, along with a new public-use file showing imputed professional and technical RVU components for globally billed services.

CMS is also asking whether the current facility-versus-nonfacility site-of-service payment differential still makes sense.

Quality Payment Program (QPP), MIPS, and MSSP

The proposed rule also touches reporting infrastructure:

• Updated Certified Electronic Health Record Technology (CEHRT) definitions aligned with ASTP/ONC HTI-5 requirements
• A one-year transition period in CY 2027 encouraging FHIR-enabled electronic prior authorization ahead of mandatory rules expected in CY 2028
• Continued movement toward MIPS Value Pathways (MVPs), with traditional MIPS expected to phase out by 2029

Other Proposed CY 2027 Provisions

CMS is also proposing or requesting comment on:

• Primary care valuation — potential changes to primary-care payment and prospective payment models within Original Medicare and the Shared Savings Program
• Shared medical appointments — new coding and payment structures
• Behavioral health and tobacco cessation — completing valuation increases for timed behavioral-health and SBIRT services
• Advance care planning (ACP) — two new HCPCS codes for ACP furnished by clinical staff, while existing ACP CPT codes would be limited to time the billing practitioner personally spends
• Rural Health Clinics (RHCs) and FQHCs — proposed treatment of Diabetes Self-Management Training and Medical Nutrition Therapy as stand-alone preventive visits
• Telehealth authorities — proposed extension through December 31, 2027
• Clinical Laboratory Fee Schedule — statutory changes to data collection and phased payment reductions
• Medicare eligibility — implementation of statutory limits under Public Law 119-21
• Interoperability — a request for information on duplicate lab testing, imaging, and result-sharing

Providers who manage billing across multiple government programs may also want to compare these Medicare proposals against the Medicaid Fee Schedule FY 2027, since state Medicaid rates and CMS’s federal proposals don’t always move in the same direction or on the same timeline.

What’s Not Yet Final

As of August 22, 2026, several pieces of the CY 2027 fee schedule remain unsettled:

• Final conversion factors for both APM categories
• Final RVUs and payment amounts for individual CPT/HCPCS codes
• Final GPCI values and related payment files
• Final treatment of G2211, the global-period E/M overlap policy, and RPM/RTM rules
• Final QPP and MIPS requirements for the 2027 performance year
• Specialty-by-specialty or place-of-service payment impacts

None of the figures above should be treated as locked in. Only CMS’s published final rule and official payment files will confirm actual CY 2027 rates.

Key Dates for CY 2027

How This Could Affect Providers and Patients

For clinicians and billing teams, the proposed conversion factor decrease means planning for tighter per-service reimbursement even as documentation and modifier rules grow more complex — particularly around G2211, Modifier 25, and RPM/RTM billing.

Practices should watch for the final rule in November 2026 before adjusting 2027 budgets or fee schedules.

For patients — especially those who rely on both Medicare and Medicaid — coverage rules can shift independently of provider payment policy.

If you’re unsure whether you still qualify for Medicaid alongside Medicare, it’s worth checking the Medicaid Income Limits by State in 2026 to confirm your eligibility hasn’t changed.

Frequently Asked Questions

Sources & Disclaimer

Sources:

• CMS, “Calendar Year (CY) 2027 Medicare Physician Fee Schedule Proposed Rule” — cms.gov
• Federal Register, “Medicare and Medicaid Programs; CY 2027 Payment Policies Under the Physician Fee Schedule and Other Revisions to Part B” — federalregister.gov

Last Updated: August 2026

Disclaimer: CheckMedicaid.com is not affiliated with any government agency. This content is for educational purposes only and reflects a CMS proposed rule that may change before finalization. For official, current Medicare payment rates, consult CMS.gov directly.