# Medicare sets a lower physician payment rate for next year

By Ali Peivandizadeh, business growth and AI implementation specialist.
Published Nov 13, 2026. Last checked Nov 13, 2026. Last changed Nov 13, 2026.
Section: News
Who it is for: Medical practices. All sizes. Owner, manager, billing.

Medicare's final rule for 2027 cuts the payment rate for most physicians by 2.31% from Jan 1, 2027.

## The facts
- CMS released the final 2027 physician fee schedule on Nov 4, 2026. It takes effect on Jan 1, 2027.
- The conversion factor for most physicians falls from $33.40 to $32.63. That is a cut of 2.31%.
- For physicians in qualifying payment models, it falls from $33.57 to $32.95.
- In July, CMS had proposed a smaller cut of 1.68%.
- A new rule pays 20% less for the lower-paid service when an office visit and a minor procedure are billed on the same day with modifier 25.
- Medical Economics reports that dermatology, ear, nose and throat, and podiatry are affected most by that rule.
- Medicare telehealth flexibilities run through the end of 2027 under a separate law.

## What it means for you
A practice is paid less by Medicare for the same work from Jan 1, 2027, unless Congress changes the rate.

## Sources
- Medical Economics, trade publication, Nov 4, 2026: https://www.medicaleconomics.com/view/medicare-s-final-2027-fee-schedule-cuts-physician-pay-more-than-proposed-but-softens-the-same-day-visit-penalty

General business information, not medical or legal advice.

Page: https://healthcaregrowthjournal.com/news/medicare-2027-physician-payment-rate-is-lower/