CMS Releases Proposed Rule for 2027 Medicare Physician Fee Schedule

July 16, 2026

On July 14, the Centers for Medicare and Medicaid Services (CMS) released the proposed rule for the 2027 Medicare Physician Fee Schedule (MPFS).  

The AMA is working on a formal summary of the 1,600-page proposed rule. In the meantime, the MMA offers the following overview: 

Conversion Factors 

For the second year, CMS proposes four conversion factors: 

1. $33.1693 for Medicare payments to qualified providers (QPs) in advanced alternative payment models (APMs). This reflects a 1.19% decrease from 2026. 

2. $32.8409 for Medicare payments to all physicians who are not QPs, including Merit-based Incentive Payment System (MIPS) eligible clinicians. This reflects a 1.68% decrease from 2026.  

3. $20.4165 for Medicare payments to QPs for anesthesia services. This reflects a 0.89% decrease from 2026. 

4. $20.2143 for Medicare payments to non-QPs for anesthesia services. This reflects a 1.38% decrease from 2026. 

The conversion factor changes are attributable to several factors, including: 

• the expiration of a temporary 2.5% increase for CY 2026 under H.R. 1 (i.e., the “One Big Beautiful Bill Act”), 

• a 0.53% decrease from a budget neutrality adjustment to balance coding and payment policy changes, and 

• a 0.5% increase for QPs under the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). 

The AMA is disappointed that Congress continues to neglect the AMA’s standing request for permanent baseline updates to conversion factors that account for practice cost inflation, which CMS projects will be 2.5% in 2027.  

Relative Value Unit Recommendations  

Each year, the Relative Value Scale Update Committee (RUC), a body maintained by the AMA and national specialty societies, recommends changes to relative value units (RVUs). This year, CMS proposes the adoption of 90% of the RUC recommendations, including changes to RVUs associated with maternity care services, prostate biopsy, and magnetic resonance angiography.  

Merit-Based Incentive Payment System (MIPs) 

The proposed rule maintains the 2024 MIPS performance threshold at 75 points for the calendar 2026 performance year through the 2028 performance year (i.e., MIPS-eligible clinicians at or below 75 points will avoid a MIPS penalty of up to 9%). Despite AMA’s criticism, CMS is proposing to sunset traditional MIPS reporting in 2029 and transition to a new MIPS Value Pathways (MVPs) system.  

The AMA has urged Congress to address fundamental problems with MIPS with more significant, lasting changes to the program, including, but not limited to, the Medicare Physician Data-driven Performance Payment System Act (H.R. 8622).  

Maternity Services Codes 

CMS has adopted the AMA’s recommendations to update the Maternity Care Services code set effective January 1, 2027. Currently, maternity care is largely reported using one bundled, “global” code that captures nine months of care as a single service. The CPT revisions will allow care to be reported at a more granular level to improve transparency for patients, physicians, and researchers. 

Advanced Alternative Payment Model (APM) Determinations 

CMS proposes to evaluate APM Qualifying Participant (QP) status at the TIN/NPI combination level instead of the NPI level. Under this change, APM incentive payments and QP conversion factor adjustments would only apply to the clinician’s APM-relevant TINs.  

CPT Request for Information 

CMS includes a request for information (RFI) to critically analyze the AMA’s CPT coding system, CPT licensing, the CPT code development process, and the RUC.  

CMS is accepting public comments on the proposed rule through September 14, 2026.  

The MMA will continue to monitor AMA analyses of the proposed rule and share findings with MMA members. For more information in the meantime, please contact Adrian Uphoff, manager of health policy and regulatory affairs.