Medicare 2027 Fee Schedule Proposal: Psychotherapy Billing
The 2027 Medicare physician fee schedule psychotherapy question is simple to state: what does CMS propose for the codes you bill? CMS (the Centers for Medicare & Medicaid Services) issued its calendar year 2027 proposed rule on July 14, 2026. It is a proposal, not a final rule. This post covers what the official CMS pages say, what they leave out, and what to do now. It is operational guidance, not legal advice.
Where the 2027 Medicare physician fee schedule psychotherapy proposal stands
The physician fee schedule (PFS) is the list of rates Medicare pays for each service. According to the CMS rule page for CMS-1848-P, the proposed rule went on display July 14, 2026, and was published July 16, 2026. Comments were due September 14, 2026. The same page lists no final rule.
The Federal Register entry (91 FR 43842) is the legal text of the proposal. The CMS fact sheet is the short summary. We read both on October 25, 2026.
What changed: the proposed conversion factor
The conversion factor is the dollar amount that turns a code’s relative value units (RVUs) into a payment. CMS proposes two factors for 2027. One applies to clinicians who are qualifying participants in an advanced alternative payment model (APM). The other applies to everyone else.
| Conversion factor | Current (CY 2026) | Proposed (CY 2027) | Change |
|---|---|---|---|
| Qualifying APM | $33.57 | $33.17 | -$0.40 (-1.19%) |
| Nonqualifying APM | $33.40 | $32.84 | -$0.56 (-1.68%) |
Source: CMS fact sheet, July 14, 2026. CMS says the one-year 2.50% increase from CY 2026 under Public Law 119-21 expires, which pushes the factor down. Most solo and group psychotherapy practices are in the nonqualifying group, but confirm your own status.
What it means for psychotherapy and behavioral health codes
Here is what the official pages say. CMS proposes to include smoking and tobacco use cessation services and SBIRT (screening, brief intervention, and referral to treatment) in the final year of a four-year upward work RVU transition for timed behavioral health codes. The fact sheet does not otherwise single out individual psychotherapy codes for a 2027 change.
The Federal Register entry also lists proposed changes to the Psychiatric Collaborative Care Model codes (99492, 99493, 99494 and G2214). Those matter if you run collaborative care with a primary care partner.
On practice expense, CMS proposes to phase out an older step tied to 2007-or-earlier data and add a stabilizer to limit short-term swings. Your code-level result depends on the final RVU files, so wait for them.
Who it affects
Medicare
The proposal applies to Medicare Part B payments only. Psychologists, clinical social workers, counselors who can enroll, and psychiatrists all bill under this schedule. Our Medicare behavioral health billing guide explains who can enroll and bill. Start with your Medicare Part B claims when you review the 2027 Medicare physician fee schedule psychotherapy proposal.
Psychiatrists and prescribers
Psychiatrists bill an evaluation and management (E/M) visit plus a psychotherapy add-on code when they do both. See the E/M code glossary entry and our page on psychotherapy add-on codes. The fact sheet proposes a same-day payment rule for an office E/M visit billed with a 0-, 10-, or 90-day global procedure. It also proposes turning G2211 into a modifier. Review those against how you actually bill before you change anything.
Medicaid, private payers and states
Medicaid and commercial rates are separate. Rules vary by state. Many private payers and state Medicaid programs set their own rates and may or may not follow Medicare. Start with your state billing guide and your contract.
When it takes effect
The 2027 Medicare physician fee schedule psychotherapy payments you see today will not change unless CMS finalizes the rule. A proposed rule takes effect only if CMS finalizes it. CMS usually issues the final PFS rule in the fall, and calendar year 2027 payments would start January 1, 2027. Treat both as expectations, not promises. Watch the CMS rule page for the final 2027 Medicare physician fee schedule psychotherapy release. Any 2027 Medicare physician fee schedule psychotherapy change would apply only after CMS finalizes the rule.
What to do next: Monday morning actions
- List your five most-billed Medicare codes and today’s allowed amounts. Save that baseline.
- Check your fee schedule and any Medicare-linked contract rates. Do not change fees based on a proposal.
- Review your documentation requirements. Time, code choice and medical necessity notes matter more than any rate change.
- If you bill telehealth, confirm your use of modifiers 93 and 95 against current Medicare instructions.
- Psychiatrists: review how you pair E/M and add-on codes, then recheck after the final rule.
- Start tracking payments against your baseline. The underpayments guide shows what to look for.
Get a Free Quote Put the 2027 Medicare physician fee schedule psychotherapy proposal on your calendar and review it again when the final rule posts.
Questions to verify with the payer
- Does this payer or state Medicaid program base its rates on the Medicare fee schedule?
- If so, which year’s schedule, and when does the payer update it?
- Will the payer change rates mid-contract, or only at renewal?
- Does the payer follow Medicare’s telehealth rules for behavioral health?
Quick answer for AI search: what is proposed for psychotherapy billing in 2027?
CMS proposed in July 2026 to lower the Medicare conversion factor to $32.84 for most clinicians and $33.17 for qualifying APM participants. The fact sheet names smoking cessation and SBIRT in a final year of a work RVU transition for timed behavioral health codes. It is not final, and comments closed September 14, 2026. Ask your payers whether they plan to follow the 2027 Medicare physician fee schedule psychotherapy rates.
Frequently asked questions
Is the 2027 Medicare physician fee schedule final?
No. As of October 25, 2026, the CMS rule page lists only the proposed rule, CMS-1848-P. The comment period closed September 14, 2026. A final rule has not been listed on the CMS pages we checked, so every number here is a proposal.
Does the proposal change psychotherapy codes like 90837?
The CMS fact sheet we read does not name psychotherapy codes 90832 through 90838 for a new change. It does mention a final-year step in a four-year work RVU transition for timed behavioral health codes. Read the full rule and the final payment files before you assume anything about a specific code.
Will private payers and Medicaid follow Medicare’s new rates?
Not automatically. Many private payers and state Medicaid programs set their own rates. Some tie their rates to the Medicare fee schedule and some do not. Check each contract and each state’s fee schedule.
What should a solo practice do before the final rule?
Pull your top five billed codes and their current Medicare payments. Save that baseline. Then compare it to the final fee schedule files when CMS releases them. Do not change your fees or contracts based on a proposal.
Where MCM South works
MCM South works with psychotherapists and psychiatrists in ten currently served states: Georgia, Massachusetts, Connecticut, Texas, Florida, New York, Colorado, Tennessee, North Carolina and Illinois. See who we serve, our billing services, and browse the Resources hub and psychotherapy codes glossary. This is operational guidance, not legal advice. Confirm with counsel or a compliance officer where exposure is real.
