By Barbara Rubel, MBA, FRBMA
MSN Senior VP, Marketing & Client Services
On July 14, 2026, the Centers for Medicare & Medicaid Services (CMS) released the Calendar Year (CY) 2027 Medicare Physician Fee Schedule (MPFS) Proposed Rule, outlining payment and policy changes that will, if finalized, determine physician reimbursement beginning January 1, 2027. While the conversion factors are proposed to decline due to the expiration of the one-year 2.5 percent increase that was included in the “Big Beautiful Bill,” CMS estimates that radiology will experience modest net payment gains. That said, a true impact analysis must also include changes in relative value units (RVUs) and a significant revision to the practice expense (PE) methodology.
Conversion Factors
Specialty Impact Based on RVU Changes (Table D-B5)
The above estimates reflect changes in RVUs only and individual practices should expect actual impacts to vary based on status as a QP or a non-QP, procedure volumes and modality mix, sites of service, and Medicare as a percentage of the total payer mix.
Qualifying Participant Thresholds
Providers who meet the thresholds outlined below at either the ACO level or the individual NPI level are deemed to be Qualifying Participants (QPs). CMS has updated the 2026 thresholds (which are now equal to the 2024 thresholds) and the proposed 2027 thresholds are identical to the 2025 thresholds. In 2026, QPs are eligible for the 0.5 percent higher conversion factor and a QP bonus of 3.1 percent. However, they are not eligible for any MIPS payment adjustments.
Proposed Changes to the Practice Expense Methodology
Radiology is a capital-intensive specialty. MRI systems, CT scanners, PET equipment, angiography suites, PACS infrastructure, Artificial Intelligence (AI) software, and highly trained technologists make Practice Expense RVUs (PE RVUs) a larger component of reimbursement compared to many other specialties.
CMS is proposing to retain the 2026 policy of reducing the amount of indirect PE RVUs that are allocated to facility-based services by 50 percent. They are seeking comments on whether 50 percent is an appropriate reduction or if it should be less than 50 percent and potentially as low as zero percent.
They are also seeking comments on whether/how they might define and identify providers who are employed by facilities to ensure the services they furnish are not inappropriately consuming PE RVUs that would be more appropriately assigned to providers who incur comparatively greater practice expenses. They are questioning if a new HCPCS modifier for employed physicians would be a reasonable way to identify and reduce facility PE from the services they perform in the facility setting. With respect to the indirect allocation of the PE RVUs, there is no change to codes with modifier 26 in either the facility or the non-facility setting.
Phasing Out Specialty Surveys
Phasing out reliance on outdated specialty survey data that ties PE RVUs to 2007 specialty cost data is another proposal being considered by CMS. This transition would occur over a two-year period, and a PE “stabilizer” would be implemented to limit annual PE RVU changes to +/-5 percent.
Evaluation and Management (E/M) Add-On Code G2211
In the CY 2021 PFS final rule, CMS finalized separate payment for HCPCS G2211, the Office/Outpatient E/M visit complexity add-on code, with payment implemented in CY 2025. CMS is proposing to delete this code and to replace it with two modifiers, MOD1 and MOD2. Both modifiers would be appended to the base E/M code and both would recognize the complexity of providing longitudinal care. However, MOD2 would be exclusively available to ACO participants and payment for the base E/M code would increase by 32 percent versus 16 percent for non-accountable care.
*Long-term Enhanced ACO Design
Stand-Alone E/M Visits and Global Periods
CMS is proposing to reduce payment when a separately identifiable office/outpatient E/M visit is furnished by the same physician (or a physician in the same practice) on the same day as a 0-, 10-, or 90-day global procedure. The most expensive service (either surgical or E/M) would be paid at 100 percent and all other surgical procedure(s) or E/M visit(s) furnished on the same day would be paid at 50 percent. This proposal is introducing the Multiple Procedure Payment Reduction (MPPR) to E/M visits and global periods.
Artificial Intelligence (AI)
The Proposed Rule does not create broad new payment pathways for AI; however, CMS continues to support technologies that improve quality, efficiency, and patient care coordination. Radiology practices should expect future Medicare policy to recognize AI applications that demonstrate measurable improvements in workflow, diagnostic accuracy, and/or patient outcomes.
Quality Payment Program
The primary themes in the Proposed Rule include:
- Continued expansion of MIPS Value Pathways (MVPs).
- Sunsetting traditional MIPS after calendar year (CY) 2028 with MVPs as the only option outside of Advanced Alternative Payment Models (AAPMs) beginning in CY 2029.
- Greater emphasis on specialty-specific quality measures which a) provide fewer choices with more difficult measures and b) allow for comparing peers who are in like specialties.
- Continued emphasis on data extraction for reporting electronic Clinical Quality Measures (eCQM) and Fast Healthcare Interoperability Resources (FHIR) measures to encourage a more interoperable, standards-based quality reporting framework.
- Prioritizing outcome measures over process measures.
- Continued incentives for participation in Advanced Alternative Payment Models (AAPMs).
- Qualifying Participants (QPs) will be determined at the TIN level versus the current method of assessing at the NPI level.
General Changes
- The penalty threshold remains at 75 points which means positive payment adjustments will remain low and it will not be harder to avoid a penalty.
- The data completeness threshold remains at 75 percent.
- The automatic Extreme and Uncontrollable Circumstances (EUCs) will no longer use the practice address that is listed in the Provider Enrollment, Chain, and Ownership System (PECOS).[1] This proposal would align eligibility with where care is delivered versus where the enrollment address happens to be.
[1] Under the current policy, CMS identifies affected clinicians based on the practice address in PECOS. If your PECOS practice address is in a FEMA-designated disaster area, CMS automatically applies the EUC exception, and the provider does not need to submit an application.
Quality
- High priority and outcome measure will be replaced by core measures.
- Measure 145 (Exposure Dose Indices Reported for Procedures Using Fluoroscopy) will be moved to a flat benchmark and will be worth up to 10 points.
- A new eCQM diagnostic radiology measure is proposed for 2028.
Improvement Activities
- There are no changes to the methodology or the requirements.
- IA_CC_19, reporting patient relationship modifiers, is a high-weighted Improvement Activity and will be available in 2027.
- 11 IAs were removed from the program, including IA_PSPA_2 Participation in Maintenance of Certification (MOC) Part IV.
- The following six new IAs have been added:
Cost
- There are no changes to the methodology or the requirements.
- There is a Breast Cancer Screening Episode-Based Cost measure that is being field tested in 2026 and could be proposed for future implementation.
Advanced Alternative Payment Model (AAPM)
- QP status will be assigned at the Tax Identification (TIN) – National Provider Identifier (NPI) level versus only at the NPI level.
- Currently, if a clinician has QP status in an ACO’s TIN, that QP status applies to all the TINs who bill for that provider and s/he is not MIPS-eligible.
- As proposed, the QP status will only apply to the TIN(s) that earned that QP status and the clinician will be MIPS-eligible under the other non-ACO TINs that bill for him or her.
- QP thresholds for 2026 have been reduced to the 2024 thresholds.
MIPS Value Pathways (MVPs)
- MVPs remain optional in 2027; however, they will replace Traditional MIPS in 2029 when Traditional MIPS is no longer an option.
- There are three new MVPs proposed for 2027, and none apply to radiology.
- Diabetic Disease MVP
- Hypertension MVP
- Hospitalist MVP (Hospital-Based Care)
- Clinicians can report under traditional MIPS, and an MVP and CMS will award the higher of the two scores.
- Registration is through the clinician’s QPP account, and the registration period is April 1st – November 30th.
- There is no penalty for registering for an MVP and then choosing to submit via Traditional MIPS only.
- Multi-specialty groups with a multi-focus of care must define their subgroups.
- Single specialty groups with a single focus of care do not have to define subgroups.
Core Measures
- Clinicians must report at least one core measure which is replacing the outcome or high priority measure requirement.
- This applies to both traditional MIPS and MVP submission.
- If the group or individual has no eligible encounters for any of the core measures an attestation must be made to CMS prior to the submissions.
- Failure to submit a core measure or attest to no eligibility will result in zero points for one of the six measures reported under traditional MIPS or one of four under an MVP.
- The proposed diagnostic radiology core measures are:
- 145: Radiology: Exposure Dose Indices Reported for Procedures Using Fluoroscopy
- 360: Optimizing Patient Exposure to Ionizing Radiation: Count of Potential High Dose Radiation Imaging Studies: Computed Tomography (CT) and Cardiac Nuclear Medicine Studies
- 405: Appropriate Follow-up Imaging for Incidental Abdominal Lesions
- The proposed interventional radiology core measures are:
- 145: Radiology: Exposure Dose Indices Reported for Procedures Using Fluoroscopy
- 413: Door to Puncture Time for Endovascular Stroke Treatment
- 420: Varicose Vein Treatment with Saphenous Ablation: Outcome Survey
Summary
The CY 2027 MPFS Proposed Rule reinforces several long-term Medicare trends as payments continue to shift from volume-based reimbursement to value, care integration, and quality measurement. There are several CMS initiatives that seem to reinforce and encourage participation in AAPMs, most notably the separate conversion factors for Advanced Alternative Payment Model (AAPM) participants and non-AAPM clinicians. The differential in payments for modifiers MOD1 and MOD2 (formerly HCPCS G2211) with respect to accountable care participants and non-participants is another good example.
The proposed overhaul of the practice expense methodology recognizes the need to update physician payments with more current and auditable data. And CMS’s interest in defining and identifying providers who are employed by facilities through a new HCPCS modifier to ensure PE RVUs are assigned appropriately will certainly impact physician payments in the facility setting.
The deadline for submitting formal comments to CMS is September 14th, 2026 and the Final Rule is typically published in early November.
Barbara Rubel
MBA, FRBMA
Senior Vice President, Marketing & Client Services
Barbara has been a leader with MSN Client Services since 1998. Her extensive background in strategic planning, market research, healthcare marketing and managed care negotiations provides a wealth of information to support MSN Clients.
Barbara has also been highly involved in industry organizations, serving as President of the Radiology Business Management Association (RBMA), the Georgia RBMA, and the Florida RBMA. In addition, she chaired the influential RBMA Federal Affairs Committee and the RBMA Technology Task force and was a member of the RBMA Data Committee. Her work on behalf of radiology has earned her the RBMA Special Recognition Award (2010), the RBMA Global Achievement Award (2013), and she is a Fellow of the RBMA.
