CMS’ proposed 2027 Medicare Physician Fee Schedule includes several payment changes that could affect physician reimbursement:
- Overall payment reductions: Most physicians who are not qualifying APM participants face a proposed 1.68% reduction to the Medicare conversion factor. Average fee schedule reimbursement is estimated to decline by approximately 2.2%.
- Specialties facing the largest cuts: Dermatology and otolaryngology could see reductions of approximately 9%, followed by orthopedic surgery at 7%.
- Other specialties facing cuts: Hand surgery (5%), ophthalmology (3%), gastroenterology (approximately 3%), neurosurgery (2%), interventional pain management (2%), and urology (approximately 2%).
- Modifier 25 changes: A proposed policy would reduce payment for certain same-day evaluation and management services billed with modifier 25 when performed alongside procedures. This is expected to have a significant impact on specialties that commonly bill for both services.
- Potential payment increases: Clinical social work is projected to increase by 12%, clinical psychology by 11%, and diagnostic testing facilities and geriatrics by 4%. Psychiatry, interventional radiology, and physical and occupational therapy are also projected to gain.
- Next steps: CMS is expected to finalize the rule in November 2026. The proposed changes could still be revised before implementation.
Practices should review the proposed changes and consider how specialty-specific reimbursement adjustments could affect their billing and financial planning.
Resource: The proposed 2027 Medicare physician pay cuts, by specialty