On our May 28 webinar, the McDermott+ team offered an early look at key issues that may appear in the Centers for Medicare & Medicaid Services (CMS) CY 2026 Medicare Physician Fee Schedule (PFS) proposed rule or are otherwise relevant to the upcoming rulemaking cycle. The session explored key developments in physician payment reform, including a preview of the conversion factor and other expected updates.
Drawing on newly released 2024 Medicare claims data, the team provided in-depth analysis of emerging coding and payment trends — highlighting utilization patterns for G2211, remote monitoring, and principal illness navigation services. The webinar also examined the evolving landscape of the Quality Payment Program, with insights into the future of the Merit-based Incentive Payment System (MIPS) and potential policy shifts on the horizon. Watch the recording here and read on for more key takeaways.
The conversion factor (CF) continues to decline in real terms, despite short-term legislative fixes. Structural issues — such as the Medicare Access and Children’s Health Insurance Program (CHIP) Reauthorization Act’s (MACRA) limited annual payment updates and separate, ongoing budget neutrality requirements — have led to a persistent gap between payment rates and inflation-adjusted benchmarks. Without comprehensive reform, physician reimbursement is expected to remain under pressure through 2035.
The team analyzed 2024 Medicare claims data to assess the real-world impact of recent coding changes. Utilization of G2211, a code intended to support longitudinal primary care for complex patients, is growing but remains below initial projections. Additionally, potentially significant repricing of supply packs could have a substantial redistributive impact across PFS payments. These changes underscore the broader impact of budget neutrality on the fee schedule.
The current practice expense (PE) methodology does not account for digital tools such as software, algorithms, and AI-enabled solutions. As a result, these technologies are appropriately reflected in payment rates for services, potentially limiting provider adoption and disincentivizing innovation. While CMS has acknowledged this issue in past rulemaking, a formal policy solution has yet to emerge.
Principal Illness Navigation (PIN) and Social Determinants of Health (SDOH) codes are gaining traction, with early data showing measurable use. However, the future of these services remains uncertain, particularly under a new administration that may shift focus away from equity-based initiatives. Continued investment in these codes will likely depend on stakeholder engagement and policy alignment.
Remote patient monitoring (RPM) services are seeing rapid growth in utilization, but reimbursement rates are not keeping pace. This trend raises concerns about the sustainability of remote monitoring technologies, among other digital health services, under the current payment model.
MIPS continues to impose administrative and financial burdens on clinicians, with limited return on investment. Despite high participation and performance rates, average payment adjustments remain modest due to budget neutrality. CMS is positioning MIPS Value Pathways (MVPs) as the future of the program, though a full transition has not yet occurred. The agency has also begun rolling back equity-focused quality measures, signaling a shift in policy priorities.
McDermott+ will continue to monitor developments and provide updates as the rulemaking process unfolds. For additional insights or support with comment letter drafting, regulatory analysis, or Medicare claims analysis, please contact our team.
When:
May 28, 2025 | 3:00 – 4:00 PM EDT
Where:
Webinar
