On November 4, 2026, the Centers for Medicare & Medicaid Services (CMS) released the Calendar Year (CY) 2027 Medicare Physician Fee Schedule (MPFS) Final Rule, establishing Medicare Part B payment and coverage policies effective January 1, 2027, except where otherwise specified.
Key provisions include:
- 340B Part D: Finalizes yet delays the mandatory quarterly 340B claims reporting, with initial Q1 and Q2 2027 submissions due September 30, 2027.
- Physician Reimbursement: Conversion factors decrease 1.83% for qualifying APM participants and 2.31% for other practitioners, primarily driven by expiration of the CY 2026 2.5% temporary payment increase.
- E/M Complexity: CMS replaces G2211 with two modifiers to modify the clinic visit add-on payment structure.
- Same-Day E/M: A 20% payment reduction applies to qualifying services billed with 0-day global procedures.
- Practice Expense: New allocation methodology may redistribute professional reimbursement across specialties and settings.
- Other Services: Changes affect telehealth billing, remote monitoring, MIPS/ACOs, rural health, behavioral health, preventive care, and chronic disease management.
Delayed Mandatory 340B Medicare Part D Reporting
CMS finalized mandatory submission of claim-level Medicare Part D data to the Part D Claims Data 340B Repository for drugs acquired at 340B discounts in the last iteration of the MPFS Final Rule. However, the current rule delays the requirements to begin submitting data to September 30, 2027.
The data elements and other operational considerations remain unchanged.
Importantly, these CMS obligations are distinct from manufacturer-specific 340B claims and encounter-level reporting policies that will be required under the Rebate Model issued by HRSA earlier this year. The Rebate Model data submission requirements will begin 1/1/2027, absent judicial action.
Covered entities should coordinate data readiness across pharmacy operations, contract pharmacies, and third-party administrators.
Physician Fee Schedule Conversion Factors
CMS finalized CY 2027 conversion factors of $32.958 for qualifying APM participants (down 1.83%) and $32.6286 for other practitioners (down 2.31%). The reductions primarily reflect expiration of the temporary 2.5% physician payment increase in CY 2026 and a negative 0.12% budget-neutrality adjustment. Actual impacts will vary by specialty, service mix, geography, and practice expense RVUs.
E/M Complexity Add-On (G2211)
CMS replaces G2211 with Modifier B1 (16% increase for eligible E/M services) and Modifier B2 (32% increase for eligible practitioners participating in Medicare Shared Savings Program ACOs or the Long-term Enhanced ACO Design Model). The percentage-based adjustment replaces the flat-rate complexity payment. B2 may apply regardless of whether the beneficiary is assigned or aligned to the participating ACO, subject to applicable requirements.
Same-Day E/M Payment Reductions
CMS finalized a 20% reduction for certain separately identifiable office/outpatient E/M services furnished on the same day as a 0-day global procedure by the same practitioner or a practitioner of the same specialty within the same group. The highest-valued qualifying service is paid at 100%, with remaining qualifying services paid at 80%. CMS narrowed its proposal, which contemplated a 50% reduction and included 10- and 90-day global procedures.
Physician Practice Expense and Hospital-Based Services
CMS finalized a two-year phaseout of the indirect practice cost index, revisions to indirect practice expense allocation using both work RVUs and clinical labor PE RVUs (excluding 10- and 90-day global services), and a practice expense stabilization adjustment. These policies may redistribute reimbursement across specialties and facility/non-facility settings, making service-level financial modeling important for hospital-employed physician practices.
Additional Payment Policy Changes
- Telehealth Billing: New Modifiers BB and BC identify certain contracted telehealth platform and incident-to arrangements, effective January 1, 2027, without independently affecting payment.
- Remote Monitoring: New RPM/RTM billing requirements, with restrictions on contracted clinical personnel delayed until January 1, 2029.
- MIPS and Accountable Care: Traditional MIPS reporting continues through 2030, with mandatory MVP reporting beginning in 2031. CMS also expanded ACO financial incentives and authorized certain beneficiary cost-sharing reductions beginning April 2027, subject to approval.
- Clinical Laboratory Fee Schedule: Statutory changes limit annual payment reductions to 15% through CY 2029.
- Global Surgery: CMS pauses existing postoperative visit data collection requirements while assessing payment accuracy.
- Advance Care Planning: New G0572 and G0573 codes address eligible clinical-staff services under direct supervision; existing practitioner-performed codes remain.
- Ambulatory Specialty Model: CMS finalized modifications to the mandatory specialty-care model focused on heart failure and low back pain.
Advis Perspective
The CY 2027 MPFS Final Rule affects physician reimbursement and 340B compliance, while creating new opportunities in preventive and chronic care. Healthcare organizations should model rate impacts, assess billing and operational changes, review quality reporting requirements, and begin preparing for 340B Part D reporting.
Advis continues to assist healthcare organizations nationwide with Medicare reimbursement, regulatory compliance, and operational readiness.
Source: CMS-1848-F, CY 2027 Medicare Physician Fee Schedule Final Rule (public inspection edition, scheduled for publication November 9, 2026). https://www.federalregister.gov/d/2026-22743
Related Advis Publications:
- CMS Releases CY 2027 MPFS Proposed Rule – https://advis.com/regulatory-updates/cms-releases-cy-2027-mpfs-proposed-rule/
Published November 5, 2026