2027 Medicare PFS: Payment Cuts and Cardiology Model

An analysis for physicians and practice leaders by Tatyana Kantor, Billing Department, WCH

On November 4, 2026, CMS issued the final CY 2027 Medicare Physician Fee Schedule (PFS) rule, effective on or after January 1, 2027. For most practices, the main points are lower conversion factors, a new payment rule for same-day visits and procedures, a restructured G2211 add-on, and a longer runway for remote monitoring rules. For roughly 2,600 cardiologists, there is an additional change: a mandatory heart failure payment model that starts in 2027.

Conversion Factors Fall

The 2027 conversion factor is $32.95 for qualifying APM participants, down $0.62 (−1.83%) from $33.57, and $32.63 for everyone else, down $0.77 (−2.31%) from $33.40.

The statutory updates are positive (+0.75% and +0.25%). The cut comes from the expiry of a one-time bump. A one-year 2.50% conversion factor increase from Public Law 119-21 (which CMS calls the Working Families Tax Cut legislation, and which most clinicians know as the One Big Beautiful Bill Act) applied only in 2026, so current law effectively requires a 2.50% reduction compared with 2026. The conversion factor also includes an estimated −0.12% adjustment for changes in work RVUs for some services.

A note on figures: the American College of Cardiology cites slightly different percentages (−1.86% and −2.36%, at $32.9548 and $32.6286). The dollar amounts agree when rounded, so the difference is in how the percentages are calculated. Practices modeling revenue should use the unrounded factors in the rule itself.

Same-day E/M Visits and Procedures

This policy changed the most between proposal and final rule. CMS proposed reducing payment when a separately identifiable office/outpatient E/M visit is billed with a 0-, 10-, or 90-day global procedure, paying the second service at 50%. The final rule applies only to 0-day global procedures, and the lower-valued service is paid at 80% rather than 50%. The higher-valued service, whether the procedure or the visit, is paid at 100%.

CMS’s rationale is that there are efficiencies when the same physician provides both and that current payment likely duplicates some resources. This matters for specialties that routinely bill a visit with a minor procedure (dermatology, gastroenterology, ophthalmology, cardiology device checks and similar), though CMS’s fact sheet does not list affected specialties.

G2211 Becomes a Modifier

HCPCS G2211, the visit complexity add-on, is being converted to a modifier. Modifier B1 raises the payment of the associated E/M code by 16%, instead of a flat amount. A second modifier, B2, is for ACO participants: it is available only to practitioners in a Shared Savings Program ACO or participant providers in a LEAD Model ACO, raises payment by 32%, is voluntary, and can be billed for all beneficiaries those practitioners serve, not only assigned ones. CMS says B2 claims will count in the ACO’s assignment, benchmark, and performance year expenditure calculations, which is worth discussing with ACO finance teams before adoption.

Remote Monitoring: One Restriction Delayed

CMS proposed four changes to RPM and RTM. It finalized three for 2027: RTM only for established patients, a separately reportable initiating visit, and updated valuation. The fourth, allowing payment only when clinical staff employed by the practice perform the service, not contractors, is delayed two years, to January 1, 2029. Practices using outside monitoring vendors have until then to adjust, but the initiating-visit requirement and revaluation apply sooner.

Practice Expense Methodology

CMS is moving practice expense (PE) calculations away from AMA survey data toward more objective, routinely updated, and auditable cost data. In this rule, CMS is phasing out the indirect practice cost index over two years and replacing it with a PE stabilizer, and allocating indirect PE on both work RVUs and clinical labor PE RVUs, except for 10- and 90-day global codes. The fact sheet does not quantify specialty-level effects, so these shifts will show up in individual code payments rather than in the headline conversion factor.

Other Changes Worth Noting

The rule also creates separate coding and payment for shared medical appointments, raises the valuation of CoCM services, creates new HCPCS codes G0572 and G0573 for advance care planning by clinical staff, and pauses MACRA section 523 global surgery data collection.

Section for Cardiologists: the Ambulatory Specialty Model

CMS did not use this rule to create the heart failure model, but it kept it in place. The Ambulatory Specialty Model (ASM) was finalized on October 31, 2025 in the CY 2026 PFS final rule, launches January 1, 2027, and runs for five performance years (2027-2031) with payment years 2029-2033. Cardiovascular Business reports that CMS kept the model in the 2027 rule, and the ACC says CMS made no further substantive changes to the heart failure model despite formal comments and several meetings.

Who is in it. CMS released a list of 2,600 general cardiologists required to participate. The AMA’s analysis of the list put the heart failure cohort at 2,600 participants, including more than 2,000 cardiologists, 300 interventional cardiologists, and fewer than 100 other physicians. The ACC reported that a number of cardiologists on the list (approximately 500, per the ACC’s check) did not meet the criteria. If you are unsure whether your name is on the list, verify it.

How it works. Participants are scored in four performance categories, compared to their peers, and final scores are translated into positive or negative payment adjustments. The model includes patient-reported outcome measures, such as the Kansas City Cardiomyopathy Questionnaire or the Minnesota Living With Heart Failure questionnaire, which many practices do not yet track.

The financial timeline. Performance in 2027 affects payments in 2029. In the first payment adjustment year (2029), adjustments range from about −9% to +9%, with larger potential adjustments later. Another summary puts the ceiling at 9% in 2029, rising to 12% by 2033. So the model does not reduce 2027 payments directly, but 2027 performance sets the later adjustment.

The main criticism. Cardiology leaders object that the model does not account for the team-based nature of heart failure care, and that outcomes often depend on factors beyond one cardiologist’s control. The AMA argued, about the proposed 2027 version, that the model’s 85% redistribution percentage means most participating physicians take a payment cut no matter how well they score. That is a stakeholder interpretation, not CMS’s characterization. The ACC said it was deeply disappointed in the final rule, citing payment updates below inflation, ASM launching without further testing, cuts to key cardiovascular services, and limits on remote monitoring.

Overall effect. CMS estimates the rule’s overall effect on cardiology payments at 0%, though the ACC noted that individual practices will see different results depending on their patient and service mix.

Practical Implications

Re-model 2027 revenue using the final conversion factors and, for procedural practices, the same-day E/M reduction. Check how often you bill a visit with a 0-day global procedure.
Update billing systems for the G2211-to-modifier change (B1, or B2 for eligible ACO participants).
Review remote monitoring workflows. Plan for the initiating visit now and for the in-house staffing requirement by 2029.
Cardiologists: confirm ASM status and build capacity now. Since 2027 performance drives 2029 adjustments, start collecting patient-reported outcomes and review your cost and care coordination data early.
ACO participants: evaluate B2 against its effect on benchmarks and expenditures before adopting it.

Limitations: This analysis relies on CMS’s fact sheet, not the full rule text, and the fact sheet does not give specialty-level impact tables beyond cardiology’s 0% estimate. CMS had proposed several ASM refinements for 2027, such as rural bonus points, a lumbar MRI measure, and a cardiologist subspecialty exception, and I could not confirm which were finalized. Check the rule text for those details.

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