Final 2027 fee schedule leaves practices less than 60 days to retrain billing teams

Practices have less than 60 days to get billing, front desk and clinical teams ready for Medicare's final 2027 physician fee schedule. The same-day visit cut CMS scaled back in the final rule still means new rules to learn, new appeals to file and new payment checks to build before Jan. 1.

"I think the biggest thing is education," said Shawntea "Taya" Gordon, MBA, FACMPE, CEO of Atlas & Perpetua Healthcare Consulting, who spoke with Physicians Practice the morning after the Centers for Medicare & Medicaid Services (CMS) released the final rule Nov. 4. "I think the biggest challenges are going to be making sure everybody understands when it applies and when it doesn't, so that they can appeal properly."

Under the rule, most clinicians face a 2.31 percent conversion factor cut, from $33.40 to $32.63, according to the CMS fact sheet. Qualifying alternative payment model participants see a 1.83 percent cut. Both are deeper than CMS projected in July, largely because the one-year 2.5 percent increase Congress provided for 2026 expires and an adjustment for work relative value units (RVUs) swung negative, Medical Economics reported.

A smaller same-day cut, but not a simple one

When an office visit billed with modifier 25 falls on the same day as a 0-day global procedure, Medicare will pay the higher-paid service in full and the lower-paid one at 80 percent. The reduction applies only when the same physician, or a physician of the same specialty in the same group, furnishes both services.

CMS had proposed paying the second service at 50 percent, reaching 10- and 90-day global procedures and applying the cut to any physician in the practice. The draft drew 44,287 public comments. Nearly 150 medical organizations signed an American Medical Association-led letter arguing CMS had not shown the overlap it wanted to remove and estimating that, for CPT code 11300, the 50 percent cut would pay about $45 against roughly $60 in staff, supply and equipment costs.

Gordon said the final version shows CMS listened, but she isn't calling it a win. "I don't think we can ever count things as a win when they're still as complicated as they are," she said. "If it takes us 15 steps to figure out what we're going to get paid, I think that's too complicated and it's not a win."

The 50 percent proposal had some physicians talking about limiting patients to one procedure a day or asking them to come back, she said. The 20 percent reduction is far less severe, but Gordon expects orthopedics and primary care to feel it often because they frequently perform a second service on the same day. CMS' own impact analysis projects the largest hits from the policy for dermatology, otolaryngology and podiatry, with orthopedic surgery and hand surgery also facing significant decreases once practice expense changes are added in.

MGMA still objects to the 20 percent reduction, which Anders Gilberg, senior vice president of government affairs, said is "interfering with physician practices' ability to offer same-day care," according to Medical Economics' roundup of physician group reactions.

Gordon expects the bigger operational headache to come from commercial payers. "Most of them will see what CMS is doing, and they'll try to follow along," she said. "We're probably going to see some confusion, or we're going to see some different interpretations."

Her advice: build alerts into the practice management system so staff catch underpaid claims, make sure the team knows how to appeal them and watch payer bulletins for how each plan applies the change.

Budgets built on G2211 need another look

G2211, the visit complexity add-on, has paid a flat amount of about $16, James Haynes, JD, an associate director of government affairs at MGMA, said in September. Starting Jan. 1, it becomes modifier B1, which raises payment for the associated evaluation and management (E/M) visit by 16 percent at every visit level. CMS expects little overall payment impact because the volume billed under the code moves to the modifier. Clinicians in Medicare Shared Savings Program accountable care organizations (ACOs) and the LEAD Model can use modifier B2 for a 32 percent increase on any patient they see.

Gordon said she doesn't mind the switch, in part because she has seen G2211 misused this year. "I've seen a lot of groups who just started putting it on every single visit, every single time," she said. "That's just not appropriate."

That habit carries audit risk. In a contributed Medical Economics article, clinical informatics specialist Kaif Ruman warned that template language from ambient AI scribes often fails to document the longitudinal care relationship G2211 requires, and that the risk climbs when the code rides on a same-day modifier 25 claim.

The switch also complicates forecasting. "I think a lot of groups have already completed their budgets and forecasts for 2027," Gordon said. With a percentage in place of a flat rate, expected payment shifts by provider type, specialty and region, and administrators will need to rework those numbers.

Because modifiers usually fall to the billing office, Gordon said B1 will push clinicians and coders to work more closely. "This is one of those areas where they're going to kind of have to come together," she said.

Start with the impact table

Gordon's first move as an administrator this week would be simple. "I'm having a team meeting," she said, with billing, administrative staff and anyone else who touches the revenue cycle.

She points administrators to the rule's specialty-level impact analysis table, which estimates how all of the changes combined will affect reimbursement, broken out by facility and non-facility settings. Comparing the final table with the July proposed table shows how much has changed since practices started planning. If a projected 4 percent decrease shrinks to roughly neutral, "that tells you you can take a breath," she said.

CMS posted that table as a separate public use file and cautioned that its figures are averages that may not match what an individual practitioner sees. It reflects more than the same-day policy. CMS finalized a two-year phase-out of the indirect practice cost index, replacing it with a stabilizer, and backed off steeper cuts to joint replacement: total hip and total knee arthroplasty each carry a final work RVU of 16.70, down from 19.11 now but above the 15.37 and 15.94 CMS proposed.

Those shifts can hit specialties inside the same group differently. Because of budget neutrality, "if you're in a multispecialty practice, it could literally create tension in your practice politically as money is shifted back and forth," Gilberg told practice leaders at an MGMA government affairs town hall in September.

Remote monitoring buys time, not a pass

Practices that mapped out responses to each possible outcome in July can now put those plans in motion. "If CMS goes left, this is what we'll do. If they go right, this is what we'll do. If they go down the middle, this is what we're going to do," Gordon said of the approach she recommended over the summer.

Remote monitoring is where that planning bought the most time. CMS delayed to Jan. 1, 2029, the requirement that remote physiologic monitoring (RPM) and remote therapeutic monitoring (RTM) be furnished only by clinical staff the practice employs, a reprieve for the many groups that outsource the work. Other pieces still take effect Jan. 1: RTM is limited to established patients, both services must start with a separately reportable initiating visit and CMS updated how the services are valued.

The delay gives practices room to run the staffing math in the Physicians Practice remote monitoring handbook on a longer clock. Practices should still check what the revalued codes will pay in 2027, since the proposal would have cut the device supply codes sharply.

Congress unlikely to step in this year

MGMA wants Congress to reverse the conversion factor and modifier 25 cuts and to pass the Patients First Act, which would tie annual physician payment updates to the Medicare Economic Index. The cuts "further degrade an already fragile payment system," Gilberg said in a statement.

Gordon is not counting on relief. Avoiding annual reductions has depended on "some end of year rapid legislation," she said, "which probably isn't going to happen this year, I would imagine, during that lame duck period."

For more, see how nine organizations responded to the final rule and Gordon's video interview with Physicians Practice. The fee schedule changes take effect Jan. 1, 2027. "We have less than 60 days now," Gordon said, "and we've got to get them implemented."