# CMS Medicare and Medicaid payment reforms

> Live situation record from CLSTR: https://clstr.news/situations/cms-medicare-payment-reform-proposals
> Updated: 2026-08-14T09:25:07.000Z. Sources: 19. Developments: 7.

Since early July 2026, CMS has rolled out a suite of Medicare and Medicaid payment reforms for FY 2027. Proposed rules for Medicare home health include a 2.4% aggregate increase, offset by a temporary 3% cut to the standardized rate to recoup prior overpayments. To curb fraud, CMS announced a six-month moratorium on new home-health enrollments and expanded its authority to revoke enrollment, potentially saving $82 million annually.

Physician reimbursement reforms include a proposed 2.5% overall cut, though endocrinology payments would rise. The Physician Fee Schedule proposal seeks to transition from volume-based metrics to outcomes, sunsetting traditional MIPS reporting after 2029 in favor of new Value Pathways for diabetes, hypertension, and hospital-based care. Additionally, CMS proposed restricting remote physiologic (RPM) and therapeutic monitoring (RTM) services to direct-practice employees and requiring an initiating visit. Recent updates also suggest changes for anesthesia practices, including the potential replacement of traditional MIPS with the Ambulatory Specialty Model.

Medicaid reforms include tightened work-reporting requirements and a July 23 proposal to overhaul the provider tax system. This overhaul aims to reduce federal Medicaid spending by $246 billion over 2026–2035 by replacing the uniform 6% federal threshold with state- and provider-specific limits.

On July 30, CMS finalized the FY 2027 Skilled Nursing Facility Prospective Payment System, increasing Medicare SNF rates by 2.4% (≈$883 million) and revising the SNF Quality Reporting Program by removing two COVID-19 vaccination measures and expanding mandatory assessment reporting to all patients.

## Timeline

### 2026-08-14: CMS proposes 2027 Physician Fee Schedule updates

CMS has proposed the 2027 Physician Fee Schedule, featuring lower reimbursement conversion factors and updates to MIPS reporting for anesthesia, while seeking input on AI and technology in primary care.

2 sources. https://clstr.news/cluster/cms-proposes-2027-physician-fee-schedule-updates

### 2026-07-30: CMS Announces 2.4% Medicare Payment Rise for Skilled Nursing Facilities

CMS released the FY 2027 SNF payment rule, raising Medicare rates by 2.4% ($882 M) and revising quality reporting by dropping COVID‑19 vaccine measures and shortening data deadlines.

3 sources. https://clstr.news/cluster/cms-announces-24-medicare-payment-rise-for-skilled-nursing-facilities

### 2026-07-30: CMS proposes Medicare physician payment and billing rule changes

CMS proposed a 2027 Medicare physician fee rule cutting overall payments, boosting endocrinology rates, changing code G2211, raising FNA fees, and tightening remote monitoring requirements, while also overhauls

2 sources. https://clstr.news/cluster/cms-proposes-medicare-physician-payment-and-billing-rule-changes

### 2026-07-23: CMS Proposes Medicaid Provider Tax Overhaul to Cut Federal Spending

CMS proposes a Medicaid provider tax overhaul that would replace the 6% threshold with variable limits, add health insurers as a tax class, and cut federal Medicaid spending by about $246 billion over ten years

3 sources. https://clstr.news/cluster/cms-proposes-medicaid-provider-tax-overhaul-to-cut-federal-spending

### 2026-07-17: US CMS proposes 2027 Medicare Physician Fee Schedule changes and remote monitoring limits

CMS proposes 2027 Medicare fee schedule cuts, ends temporary 2.5% boost, adds new value pathways, and limits outsourced remote monitoring services to practice‑staff, with reduced payments and new code bundles.

3 sources. https://clstr.news/cluster/us-cms-proposes-2027-medicare-physician-fee-schedule-changes-and-remote-monitoring-limits

### 2026-07-14: CMS proposes sweeping Medicare and Medicaid reforms

CMS unveils a home‑health enrollment moratorium, a physician payment overhaul shifting to value‑based care, stricter Medicaid work‑reporting rules, and expanded authority to deny or revoke Medicare enrollment.

10 sources. https://clstr.news/cluster/cms-proposes-expanded-medicare-enrollment-revocation-powers-and-physician-payment-overhaul

### 2026-07-02: CMS proposes 2027 Medicare payment adjustments for home health and hospitals

CMS's 2027 proposals raise home health payments 2.4% with a -3% temporary cut, add anti‑fraud rules, and give hospitals a 2.4% base increase while slashing 340B drug rates and imaging payments, yielding mixed A

2 sources. https://clstr.news/cluster/cms-proposes-2027-medicare-payment-adjustments-for-home-health-and-hospitals

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Cite as: CMS Medicare and Medicaid payment reforms. CLSTR, https://clstr.news/situations/cms-medicare-payment-reform-proposals