Medicare’s 2027 fee schedule triggers fresh warnings on payment cuts and access
The 2027 Medicare Physician Fee Schedule has set off a familiar warning from internal medicine leaders and medical group advocates: targeted fixes do not make up for a payment system that continues to lag behind the cost of care. CMS finalized the rule on Nov. 4, and the reaction from physician organizations landed quickly. The central concern is not abstract accounting. It is whether Medicare beneficiaries will keep finding enough clinicians willing to take on complex, time-intensive care under shrinking reimbursement.
The conversion factor now stands at $32.95 for clinicians in qualifying advanced alternative payment models and $32.63 for everyone else. Those figures represent cuts of 1.83% and 2.31%, respectively, and both are steeper than the reductions CMS had floated in July. In a fee-for-service system built on relative value units, even small downward changes ripple through practice revenue, staffing decisions and appointment capacity. For primary care and internal medicine groups already operating on thin margins, the effect is immediate.
The payment squeeze is not limited to one year. It reflects a multiyear pattern in which Medicare rates have been pressed by budget neutrality rules while practice costs, wages and overhead continue to rise. After nearly two decades without a meaningful increase in the conversion factor, the margin for error in outpatient medicine has disappeared.
Internal medicine leaders press for stability instead of another temporary patch
The American College of Physicians put the issue in blunt terms. The group said the payment rates are unsustainable and will eventually reduce access for Medicare beneficiaries. That concern is especially sharp in internal medicine, where clinicians often manage patients with multiple chronic conditions, medication changes and same-day concerns that do not fit neatly into short, isolated encounters.
One flashpoint is the finalized 20% reduction for services billed with modifier 25, which signals that an office visit occurred on the same day as a separate procedure. CMS had proposed a 50% reduction, so the final policy is less severe than first feared, but it still raises a practical question in everyday care: how should a clinician be paid when one encounter legitimately contains more than one medically necessary service?
The answer matters in exam rooms, not just in coding manuals. A patient with diabetes, hypertension and a lesion removal may need counseling, medication review and a separate procedure during the same visit. Penalizing that structure can push practices toward fragmentation, forcing patients back for multiple appointments or discouraging physicians from addressing more than one problem at once.
ACP also wants payment tied to G2211 to reach the internal medicine and primary care physicians who provide longitudinal care. The code, now converted to a modifier, was designed to recognize the extra cognitive work involved in ongoing management of complex patients. CMS delayed the transition from traditional Merit-based Incentive Payment System reporting to MIPS Value Pathways until the 2031 performance period, giving physicians more time to prepare for the change.
Medical groups warn that Medicare still falls short of real-world costs
AMGA, which represents multispecialty medical groups and integrated delivery systems, framed the final rule as another example of Medicare payment drifting further from the cost of care. The next round of cuts follows the expiration of a temporary 2.5% increase Congress approved for 2026, leaving groups to absorb the renewed pressure without a durable offset.
Jerry Penso, M.D., MBA, said Medicare payment continues to fall behind what it actually costs to care for patients and called for a predictable, stable and sustainable payment system. The policy ask is straightforward: tie annual conversion factor updates to an inflation measure such as the Medicare Economic Index and modernize MACRA instead of relying on another one-year patch. For multispecialty groups, the stakes are operational as much as financial. Stable reimbursement determines whether a practice can recruit clinicians, keep nursing staff and maintain appointment access for older adults who rely on Medicare.
Telehealth advocates welcome delay, but remote monitoring rules still tighten
For telehealth organizations, the most immediate concern is not the conversion factor. It is the structure CMS chose for remote physiologic monitoring and remote therapeutic monitoring. ATA Action welcomed a two-year delay in a proposal that would have limited RPM and RTM furnishing to clinical staff directly employed by the billing practice. The requirement now begins Jan. 1, 2029 rather than Jan. 1, 2027.
The delay buys time, but it does not settle the policy dispute. CMS declined to finalize a plan to replace existing RPM and RTM CPT codes with four consolidated G-codes, although the agency may revisit the issue in future rulemaking. In the meantime, several changes still begin Jan. 1. RTM will be limited to established patients, clinicians must furnish a separately reportable initiating visit when RPM or RTM starts, and CMS updated payment values for remote monitoring services.
Those changes may sound technical, but they shape whether remote monitoring remains usable for smaller practices and chronic disease programs. A patient with uncontrolled blood pressure, heart failure or another ongoing condition may benefit from device-based monitoring only if the workflow is administratively realistic. When billing rules become too rigid, the service often disappears from use even when the clinical rationale is strong.
Remote monitoring policy may help large systems more than small practices
The staffing delay is especially important because remote monitoring does not operate like a simple one-time procedure. It depends on device setup, patient instruction, transmission review and follow-up. If CMS had immediately required only employed staff, many practices would have had to rebuild their programs overnight or abandon them altogether. By extending the deadline to 2029, the agency avoided an abrupt workforce disruption, but the underlying question remains: what staffing model will Medicare eventually accept, and at what cost to smaller practices?
Daniel Tashnek, J.D., who co-founded the remote monitoring company Prevounce, argued that the initiating visit requirement is more flexible than it may first appear. It can occur in person or by telehealth, does not need to focus on monitoring alone and is required only once per patient. Patients already enrolled before Jan. 1 are grandfathered in. He also noted that RPM device codes are taking the biggest cut in 2027 after CMS aligned them with self-measured blood pressure codes, while treatment management codes stayed steady.
Contracted clinical staff remain allowed in 2027 and 2028, a detail that matters for practices built around outsourced monitoring workflows. The deferred staffing policy leaves the market in a holding pattern, but not a static one. By 2029, the rule may look very different, and practices that rely on outside vendors will have to adapt or redesign their programs.
Speech-language treatment coding gets more granular, and more demanding
Speech-language pathology faces its own billing reset on Jan. 1, 2027. Ten new treatment codes will replace a single code that has been used for decades, according to the American Speech-Language-Hearing Association. Payment will vary by treatment type and duration, which means clinicians will need to track time and services with greater precision. CMS also added all 10 codes to the Medicare Telehealth Services List.
Linda I. Rosa-Lugo, Ed.D., CCC-SLP, acknowledged that the new coding structure is a major shift for speech-language pathologists. Some members have concerns about payment and implementation, but the added specificity may make therapy work more visible to payers. In practical terms, the change recognizes that speech-language treatment is not a monolith. Different interventions consume different amounts of clinician time and carry different documentation demands, so a more granular code set could improve alignment between service and payment if practices can absorb the transition.
Congress, not CMS alone, now holds part of the answer
Most of the policies take effect Jan. 1. The immediate question is whether Congress steps in before then to blunt the conversion factor cut. A second question hangs over remote monitoring: how CMS will define staffing rules before the 2029 deadline arrives.
For now, physician groups are responding to a rule that offers adjustments at the margins while leaving the broader payment structure under strain. The scheduled changes may rearrange billing mechanics, but they do not resolve the basic tension between Medicare’s rates and the cost of delivering longitudinal, complex care.