OmniMD warns 2027 Medicare fee schedule could squeeze practice revenue

OmniMD says practices should update coding, billing and workflow rules before Jan. 1, 2027, as CMS’ proposed Medicare Physician Fee Schedule would lower conversion factors, change how G2211 is billed and cut pay for some same-day E/M visits. The company argues the rule could turn revenue cycle setup into a direct revenue driver for independent and specialty practices.

Why it matters: - The proposed 2027 Medicare Physician Fee Schedule could reduce payment for many practices even before broader cost growth is considered. - Practices that do not update coding and billing workflows before Jan. 1, 2027, could miss revenue tied to same-day E/M visits, the revised G2211 policy and changing conversion factors. - The rule is especially material for specialties with high Medicare volume and for practices paid under commercial contracts that track Medicare rates.

What happened: - OmniMD released an analysis of CMS’ Calendar Year 2027 Medicare Physician Fee Schedule proposed rule, CMS-1848-P. - CMS released the proposal on July 14, 2026, and published it in the Federal Register on July 16, 2026. - The public comment period closed Sept. 14, 2026. - CMS is expected to issue the final rule around Nov. 1, 2026, and the rule would take effect Jan. 1, 2027. - OmniMD urged practices to start preparing now rather than waiting for the final rule.

The details: - The proposed qualifying APM conversion factor would be $33.17, down $0.40, or 1.19%, from $33.57. - The nonqualifying conversion factor would be $32.84, down $0.56, or 1.68%, from $33.40. - The lower rates largely reflect the expiration of a temporary 2.50% increase attached to CY 2026 payments. - Statutory updates of 0.75% for qualifying APM participants and 0.25% for others, plus an estimated 0.53% work RVU adjustment, only partly offset that loss. - The minus 2.5% efficiency adjustment from the 2026 final rule would remain in place. - CMS projects practice costs will rise another 2.5% in 2027. - AMA analysis cited by OmniMD says Medicare physician pay fell 33% between 2001 and 2025 after inflation in practice costs. - For same-day E/M visits with procedures, the higher-valued service would be paid in full and additional same-day services would be paid at 50%. - The same-day E/M reduction would apply when the E/M is furnished by the same physician or another physician in the same group. - The American Academy of Otolaryngology–Head and Neck Surgery urged CMS not to finalize the same-day cut, citing data from more than 1,400 members on access and viability concerns. - G2211 would become a modifier billed in the same circumstances as today and valued at 16% of the base E/M code. - A separate modifier for practitioners in Shared Savings Program or LEAD Model ACOs would be valued at 32% of the base E/M code. - CMS would phase out the Indirect Practice Cost Index, which covers overhead such as rent and administrative staff. - CMS would apply 50% of the IPCI adjustment in 2027 and eliminate it in 2028. - The IPCI is based on the AMA’s 2007 Physician Practice Information Survey. - A new PE stabilizer would cap most codes’ annual PE changes at plus or minus 5%. - MedPAC supports eliminating the IPCI and the new PE stabilization adjustment. - Specialty impacts vary widely, with ophthalmology’s estimated combined impact on total allowed charges at negative 3%. - OB/GYN services are estimated to fall 2% in facilities and 1% in offices, while gynecologic oncology is projected to rise 1% in facilities and hold steady in offices. - Traditional MIPS would sunset after CY 2028, leaving MVPs as the only option outside the APM Performance Pathway from CY 2029. - CMS proposes core measure designations for quality measures and has not proposed changes to the performance threshold. - The MIPS CEHRT definition would be updated to align with ONC’s HTI-5 proposed rule starting with the 2027 performance year. - Medicare telehealth flexibilities were extended through Dec. 31, 2027, under the Consolidated Appropriations Act, 2026. - The telehealth originating site fee, Q3014, would increase from $31.85 to $32.65. - The rule includes proposed changes to the mandatory Ambulatory Specialty Model, which begins Jan. 1, 2027.

Between the lines: - The proposed rule shifts more financial risk onto workflow quality, documentation and charge capture. - The biggest near-term exposure is not just the conversion factor drop, but missed payment opportunities from poor modifier use and same-day service documentation. - The G2211 change and the same-day E/M proposal make billing logic more important for revenue than in prior years. - The phaseout of the IPCI suggests CMS is continuing to simplify practice expense methodology, but the transition could create winners and losers by specialty. - The move away from traditional MIPS after 2028 points to a narrower set of quality-reporting paths for practices to plan around.

What's next: - Practices should model 2027 revenue by CPT family and compare top Medicare codes against the proposed conversion factors. - Billing teams should audit same-day E/M and procedure pairs and tighten documentation that separates the services. - Workflow teams should build the G2211 modifier into visit templates and charge capture rules before the start of 2027. - Practices in APMs and ACOs should review participation status, since the gap between 16% and 32% modifier values could affect financial strategy. - Practices should prepare for the MVP transition in 2027 and 2028, then revisit commercial contracts tied to Medicare percentages. - OmniMD said the final rule could still change, so practices should keep their workflows flexible until CMS publishes the final version.

The bottom line: - OmniMD’s message is simple: Medicare payment changes in 2027 will reward practices that treat coding and billing as revenue operations, not back-office admin.