AAO-HNS Summary of CY2027 MPFS Proposed Rule

On July 14, 2026, the Centers for Medicare & Medicaid Services (CMS) published the Calendar Year (CY) 2027 Proposed Rule for the Medicare Physician Fee Schedule (MPFS), which also includes proposals related to the Quality Payment Program (QPP). CMS is soliciting public comment on the rule through September 14. The Academy will submit a comprehensive response to the proposals contained in the rule by this date. While AAO-HNS physician leaders and staff are still reviewing this extensive document, the following is a high-level summary of key proposals impacting the specialty.

MEDICARE PHYSICIAN PAYMENT:

Proposed Medicare Conversion Factor

• For those not qualifying under an APM (most otolaryngologist-head and neck surgeons), the conversion factor is $32.84, a decrease of $0.56 or –1.68% from the 2026 conversion factor.
• The proposed CY 2027 qualifying APM conversion factor is $33.17, a decrease of $0.40 or –1.19% from the 2026 conversion factor.

Estimated Impact to Otolaryngology

CMS estimates the overall impact of the MPFS proposed changes to be –9% for otolaryngology (with an estimated –10% change in the non-facility setting and a –3% change in the facility setting). It is important to note that this does not include the additional proposed –1.19% or –1.68% decrease to the Medicare conversion factor that all clinicians are subject to as noted above.

Payment Reduction for Same-Day Care

For 2027, CMS is proposing a significant payment reduction when an office/outpatient Evaluation and Management (E/M) visit billed with modifier 25 is provided to the same patient on the same day as a procedure with a 0-, 10-, or 90-day global period. Under the proposal, only the highest-valued affected service—whether an E/M visit or a procedure—would be paid at 100% of the fee schedule. Payment for each additional affected E/M service or global procedure furnished that day would be reduced by 50%.

The AAO-HNS strongly opposes this blanket payment reduction for medically necessary care and is encouraging members to push back. The Academy is also gathering member feedback to better understand the potential impact of the proposal. Please take a few minutes to complete this brief survey to help shape the Academy’s official comments to CMS and inform our conversations with legislators.

Payment for Telehealth Services

As specified in statute through the Consolidated Appropriations Act of 2026 (H.R. 7148), existing Medicare telehealth flexibilities (allowing broader originating sites, expanded practitioner eligibility, and audio-only telehealth) are extended through December 31, 2027. Additionally, CMS proposes to allow teaching physicians to bill for telehealth services involving residents when either the physician or the resident is in the same physical location as the beneficiary. This proposed change would improve logistical nuances from previous policymaking that required all three parties (the patient, the resident, and the teaching physician) to be in separate locations.

Changes to Methodology Used to Develop Practice Expense RVUs

For 2027, CMS is proposing significant changes to how Practice Expense (PE) RVUs are calculated. Most notably, CMS would phase out the Indirect Practice Cost Index (IPCI), which uses specialty-level survey data to allocate indirect costs, such as rent, administrative staff, and other overhead. CMS would apply only 50% of the IPCI adjustment in 2027 and eliminate it entirely beginning in 2028. Indirect PE would instead be allocated more directly using code-level inputs, including physician work, clinical labor, equipment, and supplies.

These changes would redistribute PE RVUs across specialties and services and could significantly affect office-based otolaryngology. CMS is also proposing a stabilization adjustment that would generally limit annual changes in a code’s PE RVUs to +/– 5%, with additional changes phased in over future years. The AAO-HNS plans to comment on the proposal and urge CMS to ensure that future refinements accurately reflect the practice costs of providing otolaryngology care, particularly in the non-facility setting.

Practice Expense RVUs and Any Other Coding Changes

For CY 2027, CMS proposes to continue implementing the supply pack pricing update and associated revisions as previously recommended by the RUC’s workgroup. See below for those that are commonly included in ENT PE inputs, including changes based on invoices submitted that are related to otolaryngology direct PE:

VALUATION OF SERVICES

Global Surgical Package Valuation

Expanding on sentiments expressed in previous rulemaking, CMS continues to question how to better define global surgical packages. Specifically, CMS questions whether the post-operative visits built into CPT codes with 10- or 90-day global surgical periods are occurring within the assigned period. The proposed rule cites a RAND study from 2019, which suggests that only 4% of reviewed procedures with 10-day global periods and 67% of reviewed procedures with 90-day global periods had at least one reported post-operative visit. CMS states that these findings suggest physicians may be receiving payment for post-operative visits that do not actually occur.

For CY 2027, CMS proposes to pause the requirement for certain practitioners to report post-operative visits using CPT code 99024, a no-pay reporting code. The AAO-HNS does not agree with CMS’s assumption that post-operative visits are not occurring and plans to clarify via written comment that physicians do not always submit separate claims for services that generate no additional reimbursement and are already included in the global payment.

Potentially Misvalued Services

• Allergy Immunotherapy (CPT 95165): CMS received inquiries from interested parties regarding the definition of an immunotherapy allergy dose. The interested parties stated that the current Medicare definition of a dosage is not consistent with current clinical practice, and since this was last evaluated, the number of Medicare beneficiaries receiving these services has increased over 15%. The interested parties also state that the current claim limit of 30 doses is not appropriate, and instead, an annual limit would be more accurate for this medically necessary treatment.
• Nasal Sinus Irrigation (CPT 31000 & 31002): CMS accepted the nomination of these codes as potentially misvalued. They are requesting pricing information via device invoices and comments on its typical usage within CPT codes 31000 and 31002.

Valuation of Specific Codes

Following review of the American Medical Association’s Resource-Based Relative Value Scale Update Committee (AMA RUC), the proposed rule includes work RVU (wRVU) valuations for new, revised, or potentially misvalued CPT codes. The codes listed below are of particular relevance to otolaryngology-head and neck surgery (note: highlighted values indicate that the RUC-recommended wRVUs were not accepted by CMS):

Speech Language Pathology Services (CPT Codes 92X0X-92X9X)

CMS is proposing the RUC-recommended values for the new speech pathology family of codes without modifications. The proposed rule designates these codes as always therapy services which must be furnished under a therapy plan of care and billed with a therapy modifier regardless of who provides the service—whether physicians and NPPs furnish the service themselves, or therapists furnish the services incident to the physician/NPP. Codes that represent the initial 30 minutes is subject to the multiple procedure payment reduction (MPPR), and the CPT codes that represent an additional 15 minutes are not subject to the MPPR. Those values are as follows:

QUALITY PAYMENT PROGRAM:

Merit-Based Incentive Payment System (MIPS)

Sunsetting of Traditional MIPS: CMS is proposing to sunset the traditional MIPS reporting option following the CY 2028 performance period (2030 MIPS payment year). Beginning in 2029, most otolaryngologist-head and neck surgeons—unless already reporting through the Alternative Payment Model (APM) Performance Pathway (APP)—would generally be required to participate through a MIPS Value Pathway (MVP). The AAO-HNS continues to advocate for adequate measure testing and specialty-specific refinement before MVPs become mandatory for all clinicians.

Quality Reporting Requirements:

For the CY 2027 MIPS performance categories and scoring, CMS has proposed the following:

• For the Quality Performance category:
  • Data completeness would remain at 75%.
  • Beginning in CY 2027, MIPS eligible clinicians would be required to report a MIPS core measure as 1 of 6 of their quality measures. For MVPs, clinicians would be required to report a MIPS core measure as 1 of 4 of their quality measures. Small practices (defined as a group with 15 or fewer clinicians) would be exempt from this new requirement.
• For the Cost Performance category:
  • CMS proposes no major changes to cost measures other than routine updates to the code sets used for existing measures.
• For the Improvement Activities category:
  • CMS is proposing six new improvement activities (emphasizing wellness, nutrition, lifestyle interventions, obesity management, and integration of clinical guidance into practice workflows), modifications to five existing activities, and the removal of 11 activities.
• For the Promoting Interoperability category:
  • CMS is proposing to remove several required attestations and the Security Risk Analysis measure beginning with the 2027 performance year.
  • Electronic prior authorization for medical services would be optional for bonus points in 2027 and required in 2028.
  • A new electronic prior authorization measure for prescription drugs would also become required in 2028.
• Final Score: The MIPS performance threshold remains 75 points through the 2028 performance year (2030 MIPS payment year), under policy finalized previously. This proposal provides continued MIPS scoring stability for ENT practices.

MIPS Value Pathways (MVPs)

• New MVPs: CMS proposes three new MVPs to be available for reporting in the CY 2026 performance period: Diabetic Disease, Hospitalist, and Hypertension.
• MVP Modifications: CMS is proposing to modify all 27 existing MVPs to include MIPS core measure selections, add measures to capture additional specialties, and remove measures that are scheduled to be removed from their respective MIPS inventory or replaced by more robust measures.
• Virtual MVP Reporting: Beginning with the CY 2029 performance period, virtual groups would be able to report an MVP.
• Scoring Methodology: CMS issued a Request for Information (RFI) on new scoring methodologies that would allow more equitable performance comparison of clinicians within the same MVP. The Academy plans to respond to this RFI.