CMS issued the CY 2027 Physician Fee Schedule proposed rule on July 14, 2026. It proposes a conversion factor of $32.8409 for clinicians who are not qualifying APM participants, down 1.68% from $33.4009, and $33.1693 for qualifying APM participants, down 1.19% from $33.5675. CMS proposes these figures, the final rule may change them, and comments close September 14, 2026.
Read that as a planning input rather than a rate. Model with it, do not quote it to a lender or reprice a live claim with it.
This guide explains why the factors fall, what else in the rule may matter more than the headline number, and how to size the impact on your own book before CMS publishes the final rule.
What the proposed 2027 factor does to your year
CMS has proposed lower Medicare Physician Fee Schedule conversion factors for 2027. Move the slider to your Medicare volume and the readout estimates the movement, before any change in code mix or RVUs.
Roughly $10,000 moves for every $1 million of Medicare PFS revenue per percentage point. Specialty-specific RVU changes can offset or amplify this.
The proposed drop is largely the expiry of the temporary 2.5% increase that applies in 2026, not a fresh standalone cut.
Model with these figures, do not quote them as final. Before the final rule, reprice your top twenty Medicare codes, count same-day claims that pair an E/M service with a global-period procedure, review current G2211 capture and separate facility from non-facility exposure. Then run it again once CMS publishes the final RVUs and factors.
What are the proposed 2027 conversion factors?
| Group | 2026 | 2027 proposed | Change |
|---|---|---|---|
| Qualifying APM participants | $33.5675 | $33.1693 | Down $0.40, or 1.19% |
| Everyone else | $33.4009 | $32.8409 | Down $0.56, or 1.68% |
Statute has required two separate factors since 2026, so check which one applies to you before you model anything. The gap between them widens slightly under this proposal.
Why do the factors fall when the statutory updates are positive?
Three inputs pull in different directions, and one of them dominates.
- Statutory MACRA updates raise them. The proposal reflects a 0.75% update for qualifying APM participants and 0.25% for everyone else.
- A budget neutrality adjustment raises them slightly. CMS includes a positive 0.53% adjustment to account for proposed changes in work relative value units.
- The temporary 2026 increase expires. Public Law 119-21 provided a one-year 2.5% conversion factor increase for 2026 only, and it does not carry into 2027.
So this is mostly an expiry, not a fresh cut. That distinction matters when you explain the number to physicians, because the framing changes what people expect Congress to do next.
What else in the rule may matter more than the factor?
For many practices, two other proposals move more money than 1.68% does.
1. Same-day E/M visits with global procedures
CMS proposes to reduce payment when the same physician, or a physician in the same practice, furnishes a separately identifiable office or outpatient E/M visit on the same day as a procedure carrying a 0, 10 or 90-day global period. Under the proposal the most expensive service, whether the procedure or the E/M visit, would be paid at 100%, and every other same-day procedure or E/M visit would be paid at 50%.
If your specialty routinely pairs a visit with a same-day procedure, count those encounters before you form a view on this rule. The exposure concentrates in a handful of specialties and barely touches others.
2. G2211 becomes a modifier
CMS proposes to delete HCPCS code G2211 and replace it with a modifier appended to the base E/M code, increasing payment by 16% rather than paying a flat amount. That keeps the increase proportional across E/M levels. A second modifier would offer 32% for eligible clinicians participating in Shared Savings Program or LEAD Model ACOs.
Practices with strong G2211 capture should model this carefully, because a percentage of the base code behaves differently from a flat add-on depending on your visit level mix.
How do you size the impact on your own practice?
Five steps, in this order, and none of them requires waiting for the final rule.
- Reprice your top twenty Medicare codes at both the 2026 and the proposed 2027 factor. Twenty codes usually cover the large majority of Medicare volume.
- Count same-day encounters that pair an E/M visit with a procedure carrying a global period, split by specialty and provider.
- Review your current G2211 capture rate. If it is low, the modifier change matters less than fixing the capture.
- Separate facility from non-facility exposure, because the practice expense side of the rule affects those settings differently.
- Re-run everything after the final rule, since RVUs and the factors both move between proposal and finalization.
A rough sense of scale helps while you work: roughly $10,000 moves for every $1 million of Medicare fee schedule revenue per percentage point of change. That is arithmetic, not a forecast, because specialty-specific RVU changes can offset or amplify the factor entirely. Our guide to calculating RVUs shows the mechanics, and the Medicare fee schedule lookup guide covers pulling the right figures by locality and setting.
Should you submit a comment?
Comments close September 14, 2026, and a specific comment carries far more weight than a general objection. A useful one does three things: it names the exact proposal, it shows your own numbers, and it explains the operational consequence in plain terms.
"This reduces our payments" persuades nobody. "This proposal affects 1,840 same-day encounters annually in our four-physician practice, and here is what that changes about how we schedule procedures" gives CMS something it can weigh. You can read the proposal in the CMS fact sheet and the full text in the Federal Register.
What should you tell your physicians now?
Three things, and no more. CMS has only proposed the factor, so it may still move. The bigger variable for your specialty is probably the same-day E/M proposal rather than the headline percentage. You will bring them modelled numbers once the final rule publishes, rather than reacting twice.
That last commitment matters. Practices that panic in August and re-panic in November lose credibility with their clinicians. If you want the modelling done properly, our clinic and physician group RCM team repriced client books within days of the proposed rule and will do it again when the final rule lands.
Frequently asked questions
What is the Medicare conversion factor for 2027?
CMS proposes $32.8409 for clinicians who are not qualifying APM participants and $33.1693 for those who are. Both figures remain proposed until CMS publishes the final rule, so treat them as planning inputs rather than rates.
Why is the 2027 conversion factor lower than 2026?
Mainly because the one-year 2.5% increase that applies in 2026 under Public Law 119-21 does not continue into 2027. Positive statutory updates of 0.75% and 0.25%, plus a 0.53% budget neutrality adjustment, offset only part of that expiry.
How much will the 2027 proposal cost my practice?
As a starting estimate, about $10,000 for every $1 million of Medicare fee schedule revenue per percentage point. Then adjust for your specialty's RVU changes, your same-day E/M volume and your G2211 capture, because those can swamp the factor.
When does the 2027 Medicare Physician Fee Schedule become final?
CMS accepts comments through September 14, 2026 and typically publishes the final rule later in the year, with rates effective January 1, 2027. Figures can move between proposal and finalization.
What is happening to G2211 in 2027?
CMS proposes deleting the code and replacing it with a modifier on the base E/M code, worth 16% of that code rather than a flat amount. A second modifier would provide 32% for eligible Shared Savings Program and LEAD Model ACO clinicians.
Does the same-day E/M proposal affect every specialty?
No. It bites hardest where clinicians routinely furnish an office or outpatient E/M visit on the same day as a procedure carrying a 0, 10 or 90-day global period. Count those encounters in your own data before assuming the impact.