Ophthalmologists’ $69 million question: How M+ uncovered and resolved a Medicare rate-setting error

The situation

The Centers for Medicare & Medicaid Services (CMS) updates its Medicare fee-for-service payment rates annually through a formal rulemaking process. Although the updates are public, the underlying methodology is dense and technical, and CMS rarely provides granular explanations for specific rate changes.

For most physician advocacy groups, it’s difficult to interpret these changes and identify when CMS’s rationale for a rate change doesn’t accurately align with physicians’ reality. That calculation requires both deep policy knowledge and sophisticated data analysis capabilities.

The challenge

In 2025, CMS’s proposed rule included a 5% drop in Medicare fee-for-service reimbursement for cataract surgery. The change was unexpected and stakeholders were alarmed by the potential financial implications.

Ophthalmologists perform about 1.2 million cataract surgeries per year in traditional Medicare. The proposed payment reduction would amount to a loss of more than $69 million in payments during the next year alone. The change posed a direct threat to the ophthalmologists who rely on cataract surgery as a foundational service line for their practice revenue. Companies supplying and facilities hosting ophthalmologists also would realize downstream repercussions from lower payments to physicians.

Our objective

McDermott+ was engaged to investigate the proposed payment cut. The team set out to determine whether the reduction reflected sound methodology, or if there was a flaw in Medicare’s process that warranted a formal, evidence-based challenge.

The outcome

McDermott+ applied its suite of data capabilities to the investigation – including a full-scale replication of the model Medicare uses to set the payment rates. By peeling away the multiple layers of the proposed rule, one at a time, the team uncovered an error in the methods CMS had used to calculate the cataract surgery rate.

Organizations representing physicians and other stakeholders incorporated the results of the McDermott+ analysis into formal comment letters to CMS, and CMS corrected the error in the final rule.

The result was a +9% swing in reimbursement – from the proposed -5% to a final +4%.

For ophthalmologists across the country, this correction represented a meaningful recovery of revenue that would otherwise have been lost, and a clear demonstration of what rigorous, data-driven advocacy can achieve.

CMS’s rulemaking process is complex, and while all stakeholders can read the rules, few can replicate the models behind them. McDermott+ brings a critical combination of deep policy knowledge and advanced data analysis capabilities, putting clients in a strong position to examine whether rate reductions can stand up to scrutiny.

Partnering with McDermott+ allowed stakeholders to bring an unbiased, data-driven argument to CMS, driving change for physicians.