Payers Are Changing Your Rates. Most Practices Haven’t Noticed Yet. 

By Tatyana Kantor, Billing Department, WCH 

Rate changes are showing up across New York Medicaid MCO plans, contracts, specialties, and CPT codes, but many practices may not see the pattern until revenue is affected. 

There is a problem, and it is growing. 

Across several New York Medicaid managed care (MCO) plans, practices are seeing changes in what they are paid. Some rates go down, some go up, and the changes are not uniform. Payment may change without any special signed agreement from your side.  

The changes come as New York’s Medicaid program faces funding pressure, while Medicaid MCO plans revise reimbursement rates across products and contracts. Payers have always adjusted rates. What makes this moment different is how irregular the patterns have become. Without reports and without an analyst, they are very hard for a biller to catch by reading EOBs. In-house billing teams are often not set up for this kind of monitoring, and many do not know what rate-tracking features their EMR or billing system offers. 

We have spent the last month reviewing this across actual payments among different specialties and plans. We have held several internal meetings and opened projects with payers to challenge what we found. We are telling you now because the Healthfirst changes are already showing up in many practices’ payments, and the next round, from Fidelis, takes effect in January. 

What Healthfirst changed 

Healthfirst’s new Standard Fee Schedule took effect March 1, 2026. Except for select office-based E&M and preventive visits, rates for all plans are now set as a percentage of the locality-specific CMS fee schedule. The notice warned that practices with locations in different Medicare localities may see different rates. 

For the E&M codes that kept fixed rates, the scale was flattened. Levels 2, 3 and 4 now pay the same amount: 

Code	PHSP: approx. change since 3/1/26	HFHP: approx. change since 3/1/26
99212	+89%	+93%
99213	+16%	+19%
99214	-19%	-18%
99203	+5%	+8%
99204	-31%	-29%
99205	-8%	-12%

Under PHSP, a 99214 pays roughly 19% less per visit and a new-patient 99204 pays roughly 30% less. A 99213 pays roughly 16% more, and a 99212 almost doubled. 

The impact depends on your CPT mix 

The new schedule shifts reimbursement toward lower-level E&M visits. Practices with a high share of level 2 and 3 visits may see an increase, while practices weighted toward level 4 visits may see a decrease. For those practices, volume stays the same while each visit pays less. 

The pattern may matter most for two groups. Primary care and pediatric practices, which typically bill more level 2 and 3 visits, may benefit. Specialty practices with a high share of level 4 visits may face lower reimbursement per visit. 

We see both sides in our own client base. One podiatry group bills mainly level 2 and 3 visits and will likely see revenue rise. Another practice we reviewed saw its payment for a level 4 visit drop by roughly 30%. 

It is not only E&M 

Separately from the published schedule, our review of client data across several specialties shows lower reimbursement on other services under direct contracts. The areas affected include: 

• Pulmonary function testing (PFT) 

• Allergy 

• Sleep testing 

• Diagnostics 

• Vascular and cardiology 

• Podiatry procedures 

In one practice’s data, rates now sit at roughly 70% of the Medicare Physician Fee Schedule, and at about 55 to 60% on Medicaid lines. In the Healthfirst data we reviewed, Medicaid and Essential Plan products showed some of the largest reductions. By comparison, one IPA contract we reviewed paid 70% across all lines of business. Some of the temporary rate shifts we saw turned out to be system glitches rather than real changes. A single snapshot can mislead, so look at the trend. 

Direct or IPA? Find out today. 

So far, the reductions we see are concentrated in direct contracts. Early information suggests IPA-contracted providers were not affected in the same way, but we are still confirming that. If you are not sure whether you contract directly or through an IPA, pull your contract and credentialing records. Your contract type determines how your rates are set and how much room you have to respond. 

Other plans are moving too 

Fidelis has told facilities, in individually addressed letters, that rates drop on January 1, 2027. Physical therapy and other ancillary services under Article 28 will be reduced to 80% of the fee schedule, and the letters arrived only weeks before the effective date. One possible response is leaving the Article 28 structure and enrolling through an IPA, but that brings other administrative and reimbursement rate changes that must be carefully analyzed before making a decision. This is not a change you can make by simply switching a billing setting. It requires a plan, and January is close. Independent physician practices may be affected next, but we do not have the data yet. 

Other payers: trends at other major payers are being further analyzed and monitored. Routine rate monitoring is becoming vital for healthcare practices, and we recommend that your team stay on top of it. 

What to do now 

1. Confirm your contract type, direct or IPA, and read your contracting terms. 

2. Request your sample Healthfirst fee schedule from DSEProviderRaterequests@healthfirst.org. Include your TIN and specialty. 

3. Compare claims paid since March 1 with your contracted rates and the current fee schedule. Check your E/M volume by level to see the impact, and check the volume of your other procedures. 

4. If you have Article 28 therapy services with Fidelis, review your structure before January 1. 

5. Open every payer letter and keep the dates. Notice windows are short. 

Where we come in 

We built Revenue Recovery because this is difficult to catch through manual review alone. It monitors payers, fee schedules and rates, tracks increases and decreases, and compares what different plans pay for the same CPT code. It also compares what the same plan pays different specialties for the same service. It surfaces patterns before they turn into lost revenue. 

If you want to know how these changes affect your practice, WCH can review your payer mix, contract structure, and recent reimbursement data. We also consult directly on restructuring, as in the Fidelis case above. 

Next in this series: what we are seeing from other New York Medicaid MCO plans.