CMS payment overhaul could cut specialist pay

Editor's Note

A “quiet transformation” in how Medicare pays doctors could reduce payments for specialty care, including rates for billing codes associated with surgery, diagnostic imaging, outpatient care, pain management, and orthopedics, Modern Healthcare reported July 22.

According to the article, The Centers for Medicare and Medicaid Services (CMS)’ 2026 Medicare Physician Fee Schedule proposed rule contains plans to move away from relying on survey data provided by the Relative Value Scale Update Committee (RUC), a panel formed by the American Medical Association (AMA) and other physician groups in 1991. While CMS has historically accepted RUC’s recommendations in most cases, the agency is considering alternative data sources to calculate the value of nearly 9,000 billing codes, many tied to specialty care. Reimbursements for these codes could decline by 2.5%.

In a recent LinkedIn post, Alex Krouse of the American Association of Provider Compensation (AAPC) outlined the top specialties at risk in 2026. These include:

• Dermatology, which tends to be high throughput with minimal variability.
• Ophthalmology, which is generally characterized by highly efficient, well-established procedures.
• Radiology, which is under CMS scrutiny and heavily impacted by automation.
• Pain management, which is generally characterized by repeatable, relatively less complex care.
• ENT, which is highly efficient in ambulatory surgery centers (ASC)s.
• Gastroenterology, which is generally characterized by routine, workflow-driven services.
• Urology, which generally involves many short-cycle outpatient encounters.
• Orthopedics, which have migrated to ASCs and are made more efficient by robotics.

As detailed in the Modern Healthcare article, a CMS spokesperson characterized the proposed change as part of a broader strategy to better align Medicare payments with modern clinical practice, value-based care principles, and increased investment in primary care. The outlet reports that billing codes commonly used by family medicine and primary care physicians would be exempt from reductions, while specialists could see cuts to many of their most frequently billed services.

Modern Healthcare describes how the proposal—described by CMS as an “efficiency adjustment”—revives longstanding tensions between primary care and specialty providers, who compete for a fixed Medicare budget due to statutory “budget neutrality” rules. These rules require that any reduction in payments for one set of services be redistributed to another.

Physician organizations including the American Medical Association (AMA) have criticized the proposal, although AMA also has reportedly faced criticism over conflicts of interest and the methodology used to determine relative value. Other organizations, such as the American College of Physicians, support CMS’s goals. Read the full report for more details.