Medicare cuts doctor pay 2.31% in 2027 and adds new billing rules

Medicare will lower its base payment rate for doctors by 2.31% on January 1, 2027, according to a press release from billing company Remitwright. The same rule replaces a widely used add-on billing code with new modifiers. A modifier is a short code attached to a claim that explains a detail of the service.

What changed

The release says Medicare's 2027 physician fee schedule, which sets what Medicare pays doctors, was finalized this month. A separate home health rule raises payments by 2.4%. It also expands the reasons Medicare can revoke an agency's enrollment, which means taking away its permission to bill Medicare.

Who it affects

The release focuses on small medical practices, medical transport companies and home care agencies. It says claims are often rejected for small reasons, such as a missing modifier, an expired authorization or a missing driver signature. Each unpaid claim has a deadline, and once it passes, the money is gone.

What is not known

The release does not name the add-on code being replaced, list the new modifiers or explain the new grounds for revoking enrollment. It comes from a company that sells billing services. Its view that practices that let claims pile up will notice in February is that company's opinion, not a finding.