Traditional MedicareReimbursementHigh impact
2026-07-16 - CY 2027 Medicare Physician Fee Schedule Proposed Rule
Medicare/CMS·Optometry, Geriatrics·Payment
Effective date
Jan 1, 2027
We identified it
Jul 16, 2026
Summary
CMS issued a proposed rule for CY 2027 Medicare Physician Fee Schedule with multiple payment and policy changes effective January 1, 2027, including modifications to E/M visit billing, ACO participation requirements, Quality Payment Program updates, and new HCPCS codes for home health consolidated billing and hospice telecommunications. Additionally, optometry services billing at nursing facilities must be corrected to avoid improper E/M code usage, and new hepatitis C screening code G0567 is now payable.
Action Required
REQUIREMENTS:
Immediate Actions (Now - Before January 1, 2027):
- Billing team: Review the CMS CY 2027 Medicare Physician Fee Schedule proposed rule fact sheet and quality payment program comparison table at cms.gov to understand full scope of E/M complexity add-on codes, remote monitoring policies, and global surgery payment changes
- Compliance team: Audit all optometry claims billed to nursing facilities in the past 12-24 months; identify any claims using moderate-to-high complexity E/M codes (99214, 99215, or equivalent) that do not meet Medicare E/M service criteria; prepare corrective action plan
- Billing staff: Stop billing high-level E/M services for optometry visits at nursing facilities; reference Medicare Vision Services (PDF) booklet and Items & Services Not Covered Under Medicare (PDF) booklet to determine appropriate billing codes for eye exams, diagnostic tests, and treatments
- Clinical staff: Educate optometrists on Medicare billing requirements for nursing facility services to prevent future improper claims
Before October 1, 2026:
- Billing team: Add the 19 new HCPCS codes for non-routine supplies to billing system; update home health consolidated billing enforcement rules in system (effective October 1, 2026)
Before January 1, 2027:
- Billing team: Update billing system to implement CY 2027 PFS rate setting and new conversion factor; configure system for E/M complexity add-on code requirements; update remote monitoring billing rules
- Clinical documentation staff: Revise provider templates and encounter forms to support new E/M documentation requirements for complexity add-on codes
- Hospice billing staff: Implement modifier or G code requirements for face-to-face encounters reported via telecommunications technology (effective January 1, 2027)
- Providers: Submit public comments on proposed rule changes if desired before comment deadline (deadline date not specified in newsletter)
Consequences of Inaction:
- Claims for optometry at nursing facilities using improper E/M codes will be subject to denial and potential overpayment recovery
- Home health claims using old non-routine supply codes after October 1, 2026 will be denied
- Hospice face-to-face encounter claims without proper modifiers/G codes after January 1, 2027 will be denied
- Failure to implement PFS conversion factor updates will result in incorrect reimbursement amounts