NYHealth Comments on CY 2027 Medicare Physician Fee Schedule Proposed Rule

September 14, 2026

The Honorable Mehmet Oz, M.D.
Administrator
Centers for Medicare & Medicaid Services
7500 Security Boulevard
Baltimore, MD 21244

Subject: Public Comment on CY 2027 Medicare Physician Fee Schedule Proposed Rule
Docket ID : CMS-1848-P
Submitted via: regulations.gov

Re: Revisions to Payment Policies under the Medicare Physician Fee Schedule, Quality Payment Program and Other Revisions to Part B for CY 2027

Dear Administrator Oz,

The New York Health Foundation (NYHealth) appreciates the opportunity to comment on the Centers for Medicare & Medicaid Services' (CMS) proposed rule regarding the Medicare Physician Fee Schedule (PFS) for calendar year (CY) 2027. About 4 million New Yorkers^[1]-nearly 20% of the State's population^[2]-are enrolled in Medicare, making CMS's policy decisions highly consequential for New Yorkers' health and wellbeing. Medicare payment policy also shapes how Medicaid programs and private insurers value clinician services.

NYHealth is a private, independent foundation dedicated to improving the health of all New Yorkers. We advance policies and initiatives that strengthen primary care services so New Yorkers can better prevent and manage chronic conditions. This work has provided us with in-depth knowledge of how high-quality primary care systems improve health care access and delivery.

We strongly support CMS's continued efforts to correct the longstanding undervaluation of primary care and longitudinal care in Medicare. In particular, we support CMS's efforts to recognize more fully the value and resources involved in maintaining ongoing primary care relationships and delivering comprehensive care. We encourage CMS to use this rulemaking as the foundation for a broader transition toward comprehensive, prospective, team-based, and accountable primary care payment models.

Continue correcting the undervaluation of primary care

Primary care is the cornerstone of a strong health care system. It is often a patient's first and most frequent point of contact with care and is essential to delivering preventive care services, identifying illness early, and managing chronic conditions over time.^[3],[4] The evidence is clear: when high-quality primary care is available and accessible, people live longer, healthier lives.

Yet the nation continues to underinvest in primary care. In the United States, less than 5 cents of every health care dollar goes toward primary care, with the proportion under 4 cents for Medicare-even though primary care providers handle one in three health care visits.^[5],[6],[7] At the same time, more than one-third of New York State's primary care physicians are older than 60, signaling a potential wave of retirements as many communities already struggle to obtain timely care.^[8]

The current PFS contributes to this underinvestment by failing to recognize much of the work required to deliver high-quality primary care. Primary care teams coordinate referrals, review test results, manage medications, respond to patient messages, conduct outreach, and communicate with other providers before, after, and between office visits. Much of this work is performed by nurses, pharmacists, behavioral health clinicians, care managers, community health workers, and other members of the care team. The National Academies of Sciences, Engineering, and Medicine's 2025 report, Improving Primary Care Valuation Processes to Inform the Physician Fee Schedule, found that the current PFS valuation process does not adequately capture these activities or the contributions of the full interprofessional care team.^[9] As a result, Medicare payment remains poorly aligned with how comprehensive primary care is actually delivered; practices have difficulty hiring staff, integrating behavioral health services, supporting patients between visits, and investing in the systems needed to manage care.^[10]

CMS has begun to address these longstanding valuation problems. In our comments on the CY 2026 proposed rule, we supported CMS's efforts to modernize the valuation process and draw on a broader range of data sources. We appreciate that CMS is continuing this work through its efforts to value services more accurately and use empirical data, as well as through the broader Redesigning Primary Care Request for Information (RFI).

Recommendation: We urge CMS to continue identifying and correcting misvalued services and to use more accurate, empirical, diverse data sources to determine the time and resources required to deliver care. Continued improvements to the valuation process are essential to ensuring that Medicare payment reflects how primary care is actually delivered.

Adopt proposed changes to better support longitudinal primary care

Longitudinal primary care-the ongoing relationship between a patient and a primary care clinician or team over time-allows clinicians to develop a deeper understanding of patients' needs, coordinate services across settings, and manage complex conditions. These continuous relationships are a core strength of primary care and can help patients receive more coordinated and effective care.

Evidence from accountable care reinforces the value of primary care-centered approaches. accountable care organizations (ACOs) with a strong primary care focus have generated substantial Medicare savings, demonstrating the potential of models that emphasize coordinated, longitudinal care.^[11],[12]

CMS's proposed rule would better align additional payment for longitudinal primary care with the complexity of the underlying visit, rather than providing the same flat amount in every case. The proposal would also provide enhanced payment for clinicians participating in certain ACO models, recognizing the added responsibilities of coordinating care, conducting quality reporting, and managing overall costs and health outcomes.

Recommendation: We support CMS's proposed changes to better recognize and support longitudinal primary care, including care delivered by clinicians participating in accountable care arrangements. We urge CMS to finalize these changes and ensure that primary care practices across a range of settings can benefit from these reforms that strengthen continuous, coordinated care.

Accelerate the transition toward prospective, team-based, and accountable primary care payment

More accurate fee-for-service valuation is necessary, but not sufficient. Even when office visits are more accurately valued, a visit-based system cannot fully support all the activities that define comprehensive primary care. Patient outreach, medication management, referral follow-up, care coordination, and team communication, among other activities, frequently take place outside a billable encounter. A payment system organized by individual visits limits practices' ability to organize comprehensive care around patients' needs.

CMS's exploration of prospective primary care payment through the Redesigning Primary Care RFI offers an important opportunity to address this limitation. Prospective payment provides practices with a set amount in advance to support care over a defined period, rather than providing payment only after individual visits or services occur. Hybrid models combine this predictable payment with fee-for-service reimbursement for care that is still best paid for individually. As CMS develops these models, preserving and strengthening continuity between patients and their primary care teams should remain a central design principle.

Successful prospective payment will also depend on whether practices can use resources flexibly and without excess administrative burden. Primary care practices need flexibility to support the multidisciplinary care teams their patients need, including behavioral health clinicians, pharmacists, community health workers, care managers, and health coaches. Practices also need clear rules defining eligibility, covered services, documentation, quality expectations, and interactions between prospective payments and other Medicare payments.

Recommendation: We urge CMS to develop flexible prospective and hybrid payment options that provide predictable resources for comprehensive primary care and are accessible to practices of different sizes and capacities. These models should give practices the flexibility and resources to build and sustain multidisciplinary care teams that are responsive to patients' needs, while establishing clear expectations for quality, timely access to care, and improved health outcomes. CMS should also apply lessons from Advanced Primary Care Management and other care management models to simplify participation and avoid duplicative reporting and documentation requirements.

Ensure primary care payment reform is sustainable by reducing patient cost barriers and improving payment stability for practices

Primary care payment reform will not improve access and outcomes if beneficiaries cannot afford the services. Research involving nearly 900,000 Medicare beneficiaries found that increases in ambulatory care copayments were associated with fewer outpatient visits and more hospital admissions, with greater effects among beneficiaries with chronic conditions and those living in lower-income communities.^[13]

States have also recognized this barrier: Maine requires certain individual and group health plans, subject to limited exceptions, to cover the first primary care and behavioral health office visit each year without cost sharing.^[14] CMS is also proposing to give certain ACOs more flexibility to reduce or eliminate Medicare Part B cost sharing for covered services, which would help lower out-of-pocket costs for beneficiaries.

Affordability for patients must be matched by payment stability for practices. CMS's proposed reforms complement efforts underway in New York and other states to rebalance health care spending. New York policymakers are considering legislation that would establish a 12.5% primary care spending target and require payers below that target to increase their primary care investment over time.^[15] Other states have paired increased investment with more predictable payment. Massachusetts Medicaid pays participating ACO primary care practices through fixed per-member, per-month payments designed to provide consistent revenue, while Rhode Island requires commercial insurers to increase primary care funding over a multiyear period.^[16],[17] Together, these efforts show that sustainable primary care reform requires both increased investment and payment methods that give practices reliable resources to plan for the future.

Federal payment policy must provide similar stability. CMS has proposed changes to ACO benchmarks to prevent organizations that successfully lower spending from facing increasingly difficult future targets based on their own past success. We are concerned that the proposed reductions to the CY 2027 conversion factors could make it more difficult for practices to plan long-term investments in workforce, technology, and care delivery. We recognize that these reductions largely reflect the expiration of a temporary statutory payment increase and that budget neutrality constrains CMS's flexibility.

Recommendation: We support benchmark reforms that allow successful ACOs to sustain and reinvest their savings. We urge CMS to finalize its proposal to reduce or eliminate Medicare Part B cost sharing for eligible services and keep out-of-pocket costs from discouraging beneficiaries from receiving primary care, behavioral health care, and other services delivered through comprehensive primary care models. Within its existing authority, CMS should limit avoidable payment instability and clearly identify where Congressional action is needed to establish stable and sustainable payment updates. CMS should continue working toward greater alignment among Medicare, Medicaid, and private insurers so that primary care practices have more consistent incentives to invest in comprehensive care.

Conclusion

The CY 2027 proposed rule represents a meaningful step toward aligning Medicare payment with the way high-quality primary care is delivered. We strongly encourage CMS to continue improving how primary care services are valued, strengthen support for longitudinal care, advance a broader transition to prospective and accountable primary care payment, reduce financial barriers for beneficiaries, and improve payment stability for practices. Together, these proposals can strengthen comprehensive, longitudinal primary care and give practices the required resources and flexibility to meet patients' needs over time.

We would be happy to answer questions or share additional insights from our primary care partners in New York State. For more information, please contact Program Officer Victoria Russo ([email protected]).

Respectfully,

David Sandman, Ph.D.
President and CEO
New York Health Foundation

[1] Centers for Medicare & Medicaid Services. Medicare enrollment dashboard. Updated August 24, 2026. https://data.cms.gov/tools/medicare-enrollment-dashboard

[2] U.S. Census Bureau. ACS demographic and housing estimates. American Community Survey 5-Year Estimates. Table DP05. Accessed August 11, 2026. https://data.census.gov/table/ACSDP5Y2024.DP05?g=040XX00US36

[3] Shi L. The impact of primary care: a focused review. Scientifica (Cairo). 2012;2012:432892.

https://pmc.ncbi.nlm.nih.gov/articles/PMC3820521/

[4] Levine DM, Landon BE, Linder JA. Quality and experience of outpatient care in the United States for adults with or without primary care. JAMA Intern Med. 2019;179(3):363-372. doi:10.1001/jamainternmed.2018.671

[5] Neumann A, Phillips R, Coffman M, Jabbarpour Y, Bazemore A, Petterson SM. Investing in Primary Care: A State-Level Analysis. Patient-Centered Primary Care Collaborative; 2019.

https://www.pcpcc.org/sites/default/files/resources/pcmh_evidence_report_2019_0.pdf

[6] Jabbarpour Y. 2026 primary care scorecard shows continued underinvestment, workforce strain. Milbank Memorial Fund. Published February 12, 2026. Accessed August 14, 2026. https://www.milbank.org/2026/02/2026-primary-care-scorecard-shows-continued-underinvestment-workforce-strain/

[7] National Academies of Sciences, Engineering, and Medicine. Implementing High-Quality Primary Care: Rebuilding the Foundation of Health Care. National Academies Press; 2021. doi:10.17226/25983

[8] Ford MM, Allard A, Cobbs E, Sandman D, Cohen L. The State of Primary Care in New York: A 2025 Data Update. New York Health Foundation and Primary Care Development Corporation; 2026. https://nyhealthfoundation.org/resource/data-brief-the-state-of-primary-care-in-new-york-a-2025-data-update/

[9] National Academies of Sciences, Engineering, and Medicine. Improving Primary Care Valuation Processes to Inform the Physician Fee Schedule. National Academies Press; 2025. doi:10.17226/29069

[10] Cottrill A, Cubanski J, Neuman T. What to know about how Medicare pays physicians. KFF. Published October 7, 2025. https://www.kff.org/medicare/what-to-know-about-how-medicare-pays-physicians/

[11] Centers for Medicare & Medicaid Services. ACO Primary Care Flex Model frequently asked questions. https://www.cms.gov/priorities/innovation/innovation-models/aco-primary-care-flex-model/faqs

[12] Centers for Medicare & Medicaid Services. Medicare Shared Savings Program saves Medicare more than $1.8 billion in 2022 and continues to deliver high-quality care. Published August 24, 2023. https://www.cms.gov/newsroom/press-releases/medicare-shared-savings-program-saves-medicare-more-1-8-billion-2022-continues-deliver-high-quality

[13] Trivedi AN, Moloo H, Mor V. Increased ambulatory care copayments and hospitalizations among the elderly. N Engl J Med. 2010;362(4):320-328. doi:10.1056/NEJMsa0904533

[14] Maine Legislature. An Act to Enact the Made for Maine Health Coverage Act and Improve Health Choices in Maine. LD 2007, HP 1425. 129th Legislature. https://www.mainelegislature.org/legis/bills/bills_129th/billtexts/HP142501.asp

[15] Health Care for All New York. 2026 New York policy agenda. https://hcfany.org/policy-agenda/

[16] MassHealth. MassHealth Primary Care Sub-Capitation Program. Commonwealth of Massachusetts. https://www.mass.gov/masshealth-primary-care-sub-capitation-program

[17] Care Transformation Collaborative of Rhode Island. Commissioner King on new regulations to strengthen primary care. Published March 20, 2025. https://ctc-ri.org/03/20/2025/commissioner-king-new-regulations-strengthen-primary-care