CY2027 Physician Fee Schedule Proposed Rule: What Specialists Should Watch

The rule is out. This page covers the actual numbers, what CMS proposed for each audience, and where VBCA is pushing back during the comment period.

Our Take, by Audience

One rule, very different consequences depending on where you practice. Start with yours:

Why This Rule Matters More Than Most

Every summer, CMS publishes the proposed Physician Fee Schedule for the following year—several thousand pages covering payment rates, the Quality Payment Program, the Medicare Shared Savings Program, and Innovation Center models. Most years, the changes are incremental. The CY2027 rule is different for two reasons.

First, 2027 is year one of the Ambulatory Specialty Model—the first mandatory, specialist-level accountability model in traditional Medicare. This rule is CMS's last full rulemaking cycle before the model goes live on January 1, 2027, and it carries the model's operational refinements. Second, the one-time 2.5% payment increase Congress provided for 2026 expires at the end of this year, which means the 2027 math starts with a pay cut unless Congress acts.

Key Dates

What Is Already Locked In by Statute

Some of the most consequential numbers in the CY2027 rule aren't up for debate—they're set by law:

• The 2.5% bump disappears. The one-year 2.5% increase Congress passed for 2026 (in H.R. 1) applies to 2026 only. It does not carry into the 2027 baseline.
• Two conversion factors, small statutory updates. Since 2026, MACRA sets separate updates: +0.75% for qualifying Advanced APM participants (QPs) and +0.25% for everyone else. For reference, the 2026 conversion factors are $33.5675 (QP) and $33.4009 (non-QP).
• The proposed 2027 conversion factors are $33.17 for qualifying APM participants (down 1.19%) and $32.84 for everyone else (down 1.68%). The components: statutory updates of +0.75%/+0.25%, a +0.53% budget-neutrality adjustment, and the expiration of the one-year 2.5% increase Congress funded for 2026. Restoring any of that cut requires legislation, not comments.
• Anesthesia has its own conversion factors: $20.4165 (QP, down 0.89%) and $20.2143 (non-QP, down 1.38%).
• The MIPS performance threshold stays at 75 points through the 2028 performance year—CMS finalized that through prior rulemaking. What this rule changes is everything around the threshold: measure inventories, benchmarks, and scoring policy.

Watch #1: The Ambulatory Specialty Model Enters Year One

ASM was finalized in the CY2026 rule, so its core design—mandatory participation for cardiologists (heart failure) and spine/pain specialists (low back pain) in selected geographic areas, payment adjustments scaling from ±9% to ±12% of Part B revenue—is settled. The proposed rule delivers the operational layer: clarifications to quality measure scoring, exclusions for certain participants based on subspecialty, a new rural adjustment, and a voluntary patient-reported outcome data submission option. We are reviewing each against our clients' positions and will cover the details in the ASM sections of this series.

Just as notable is what the rule does not do: CMS proposes no new mandatory models this cycle. After TEAM (2026) and ASM (2027), the model pipeline pauses—which makes ASM's first year the template to watch for whatever comes next.

Separately—likely around the same window—CMS will publish the final participant list. The February preliminary list named 6,637 clinicians, but CMS re-runs the episode-volume and specialty determinations on updated claims data. If you were on the preliminary list, plan as if you're in. If you weren't but practice in a mandatory area, check the final list carefully—you can be added. Our ASM participant lookup will be updated the day the final list is available.

Watch #2: The MVP Endgame Is Now a Formal Proposal

The speculation is over. CMS formally proposes to sunset traditional MIPS after the CY2028 performance period, making MIPS Value Pathways the only reporting option for non-APM clinicians beginning with CY2029. If finalized, every practice reporting traditional MIPS today has two more full cycles before the pathway question stops being optional.

• Three new MVPs proposed for 2027—Diabetic Disease, Hypertension, and Hospitalist—bringing the total to 30, with all 27 existing MVPs modified. CMS estimates the expanded inventory gives roughly 98% of specialties a relevant reporting option. (The Hospitalist MVP's measure composition was not yet public at this writing.)
• The quality inventory shrinks from 190 to a proposed 180 measures: 20 removals, new additions, and substantive changes to 43 more. Selection math changes even where clinical performance doesn't.
• A new "core measure" requirement (78 designated measures) would replace the outcome/high-priority measure requirement in traditional MIPS. Small practices are exempt.
• What this means for the registry inventory. The proposals directly determine which measures reportable through our registry remain available in 2027 and how benchmarks shift. We maintain the full library—2026 measure list and benchmarks—and will publish the 2027 registry-supported inventory when the final rule locks it.
• Registry requirements. Beginning with the 2027 performance year, QCDRs and qualified registries must fully support the MVPs applicable to the clinicians they submit for—a requirement finalized in the CY2026 rule. (VBCA's registry roadmap already accounts for this.)

Watch #3: Efficiency Adjustment, Round Two — Answered

The most contested policy in last year's rule—the 2.5% "efficiency adjustment" to the work RVUs of most non-time-based services—does not reappear for 2027. CMS treats it as recurring every three years; the next application would be CY2029.

What the rule does instead on practice expense is arguably bigger. It extends the facility indirect-PE treatment to SNF Part A visits, begins phasing out the 2007-era specialty PE/HR survey data in favor of a "PE stabilizer," and—most consequentially—openly solicits comment on whether the facility/non-facility payment differential should exist at all, floating facility indirect PE as low as zero. For clinicians who practice in facilities, that question is the whole ballgame. Our hospital-based clinicians deep dive, where VBCA's site-of-service comment lives, covers it in full when it publishes this window.

Watch #4: The Rest of the Rule

• Telehealth. RHC/FQHC telehealth and the mental-health in-person waiver run through December 31, 2027—statutory, via the CAA 2026. The broader flexibility cliff remains a congressional question, not a rulemaking one.
• MSSP. The largest Shared Savings package in years: quality reporting relief, a new collection type, six benchmark methodology changes, and an ACO-only payment modifier. Full analysis in the MSSP ACO deep dive.
• Digital quality measurement. The rule carries an RFI on a FHIR transition: optional dual-track reporting CY2028–2029, mandatory for transitioned measures CY2030. Our comment will focus on EHR and certified-technology readiness, and on where the burden actually lands—registries and small practices.
• Innovation Center signals. No new mandatory models this cycle. The signals worth watching are the prospective primary care payment solicitation and the MSSP specialty-integration RFI—both covered in the ACO article. Our policy landscape overview tracks the longer pattern.

What to Do Between Now and the Final Rule

• Baseline your top codes now. Pull your highest-volume Medicare CPT codes and model them at the proposed conversion factors, not 2026 rates.
• Check the final ASM participant list the day it publishes—even if you weren't on the preliminary list.
• Model 2027 at $33.17 / $32.84. If Congress restores some of the expired 2.5%, that's upside. Budgeting on the proposed numbers costs nothing.
• If you're in (or considering) an ACO: the participant-list decision has real money attached in 2027; read the ACO deep dive.
• Comment. Comments are due September 14, 2026, and this is a cycle where they matter: collection-type mechanics, modifier administration, and the RFIs are exactly what CMS refines in response to specific, operational input. VBCA is drafting its letter and collecting clinician input now—if a proposal would hit your practice in a way CMS should hear about, tell us and we'll carry it into the letter.