On September 11, the Endocrine Society formally submitted a comprehensive set of comments to the Centers for Medicare and Medicaid Services (CMS) regarding the proposed rule for the Calendar Year 2027 Medicare Physician Fee Schedule (MPFS). This annual regulatory update serves as the primary mechanism for adjusting payment policies and reimbursement rates for Part B services, which are critical to the financial viability of endocrinology practices and the accessibility of specialized care for millions of Medicare beneficiaries. While the proposed rule includes several specialized victories for endocrinologists, it also presents significant challenges, most notably a projected 2.5% decrease in the conversion factor that would affect all physicians across the medical spectrum.
The Endocrine Society’s response, drafted in close collaboration with its Clinical Affairs Core Committee (CACC), highlights a complex landscape of regulatory shifts. The society is currently navigating a dual reality where specialty-specific adjustments could yield a 2.5% increase for endocrinology, yet the broader systemic reduction in the conversion factor threatens to negate these gains. This dichotomy has prompted the Society to intensify its calls for Congressional intervention, advocating for a permanent legislative fix that ties Medicare reimbursement to the Medicare Economic Index (MEI), ensuring that physician pay keeps pace with the rising costs of practicing medicine.
The Medicare Physician Fee Schedule and the Conversion Factor Crisis
The Medicare Physician Fee Schedule is the cornerstone of federal healthcare reimbursement, utilizing a resource-based relative value scale (RBRVS) to determine payment for services. Each service is assigned a value based on Work Relative Value Units (RVUs), Practice Expense RVUs, and Malpractice RVUs. These units are then multiplied by a "conversion factor"—a fixed dollar amount—to determine the final payment. For the 2027 cycle, CMS has proposed a 2.5% reduction in this conversion factor.
This reduction is not an isolated event but part of a long-standing trend of stagnant or declining Medicare reimbursement rates. According to historical data from the American Medical Association (AMA) and other medical advocacy groups, Medicare physician payment has effectively declined by approximately 29% since 2001 when adjusted for inflation. The Endocrine Society’s letter emphasizes that while the 2.5% specialty-specific increase for endocrinology is a positive step, it is insufficient if the underlying conversion factor continues to erode.
The Society has urged Congress to pass legislation providing an annual inflationary update to the MPFS. By tying the conversion factor to the MEI—a measure of the price of inputs used in providing physician services—the healthcare system could move away from the current "budget neutrality" requirement that often necessitates cuts in one area to fund increases in another. Without this legislative override, the Society warns that physician burnout will accelerate, and the financial sustainability of independent practices will remain in jeopardy.
Advances in Fine Needle Aspiration Reimbursement
One of the most significant "wins" identified in the Endocrine Society’s comments pertains to Fine Needle Aspiration (FNA) services. FNA is a critical diagnostic procedure used by endocrinologists to evaluate thyroid nodules and other endocrine-related masses. For years, medical societies have argued that the practice expense inputs for these services did not adequately reflect the modern costs of equipment and technology.
In the proposed rule, CMS has suggested the creation of a new practice expense equipment item: ER130, designated as "Fine Needle Aspiration portable ultrasound." This proposal follows extensive advocacy by the Endocrine Society and other medical organizations at the Current Procedural Terminology (CPT) and the RVS Update Committee (RUC). The inclusion of portable ultrasound as a recognized practice expense acknowledges the reality of modern endocrinology, where ultrasound-guided FNA has become the standard of care to ensure precision and patient safety.
The Society’s support for this change is rooted in the necessity of covering the high overhead costs associated with maintaining and operating high-resolution ultrasound equipment. By formalizing this equipment item, CMS would ensure that the reimbursement for FNA services more accurately reflects the resources consumed during the procedure. This adjustment is expected to bolster the financial stability of endocrinology clinics that provide these essential diagnostic services in-office, potentially reducing the need for hospital-based referrals.
The Controversy Surrounding G2211 and the MOD1 Proposal
While the FNA updates were met with approval, the Endocrine Society expressed deep concerns regarding CMS’s proposal to alter the reimbursement structure for complex care. Currently, physicians utilize the G2211 add-on code to account for the additional time, intensity, and resources required to manage patients with complex, chronic conditions—a hallmark of endocrinology practice. CMS has proposed deleting this code and replacing it with a new modifier code, temporarily titled MOD1.
Under the proposal, the MOD1 modifier would be appended to an appropriate Evaluation and Management (E/M) code, resulting in a payment increase equal to 16% of the value of the reported E/M CPT code. While this might appear to simplify the billing process, the Endocrine Society’s analysis suggests a detrimental impact on Work RVUs, particularly for physicians practicing within large hospital systems and academic medical centers.
The Society’s letter highlights that the transition from a distinct code (G2211) to a modifier-based system (MOD1) could lead to a net loss of Work RVUs. In many large healthcare systems, physician compensation and productivity metrics are tied directly to Work RVUs. A reduction in these units could lead to lower salaries for endocrinologists who specialize in managing the most difficult cases, such as brittle diabetes, rare endocrine cancers, or complex pituitary disorders. The Society has urged CMS not to finalize this proposal, advocating instead for the retention of the G2211 code to ensure that the "intellectual work" of complex disease management remains appropriately valued.
Modifier 25 and the Threat to Integrated Care
Another point of contention in the Society’s feedback involves the use of Modifier 25. This modifier is used to report a "significant, separately identifiable" E/M service performed by the same physician on the same day as a procedure or another service. CMS has proposed a reduction in payment when Modifier 25 is billed under certain circumstances alongside an E/M visit.
The Endocrine Society has asked CMS to reconsider this proposal, citing its potential to hinder integrated patient care. Endocrinologists frequently manage patients who require both a procedural intervention (such as an injection or a biopsy) and a comprehensive consultation for a separate chronic condition during the same visit. Reducing payment for these services disincentivizes "one-stop" healthcare, potentially forcing patients to schedule multiple appointments for issues that could have been resolved in a single encounter. This not only increases the burden on the patient—particularly those in rural areas with limited transportation—but also increases administrative overhead for the practice.
Chronology of the 2027 Rule-Making Process
The path toward the finalization of the Medicare Physician Fee Schedule is a months-long process involving multiple stakeholders. The timeline for the 2027 rule began in early summer when CMS released the initial proposal for public inspection.
- July: CMS releases the proposed rule, opening a 60-day public comment period.
- August: The Endocrine Society’s Clinical Affairs Core Committee (CACC) begins a rigorous review of the 2,000+ page document to identify impacts on the specialty.
- September 11: The deadline for public comments. The Endocrine Society submits its detailed letter, joining hundreds of other medical organizations in providing expert feedback.
- September – October: CMS staff review thousands of comments from physicians, patient advocacy groups, and healthcare systems.
- Early November: CMS is expected to release the Final Rule, which will outline the finalized payment rates and policy changes that will take effect on January 1, 2027.
This cycle highlights the importance of proactive advocacy. The Society’s collaboration with the CACC ensures that the voices of practicing endocrinologists are heard by federal regulators before policies are set in stone.
Broader Implications for the Endocrinology Specialty
The proposed changes come at a time when the field of endocrinology is facing a significant workforce shortage. Data from the Association of American Medical Colleges (AAMC) suggests that the demand for endocrine services is outstripping the supply of specialists, driven by the rising prevalence of diabetes and obesity. In this context, any policy that reduces reimbursement or increases administrative burden could have a chilling effect on the recruitment of new physicians into the specialty.
The Endocrine Society’s analysis suggests that the 2.5% specialty-specific increase, while helpful, may be offset by the broader conversion factor cut and the potential loss of RVUs from the MOD1 proposal. For a typical endocrinology practice, where a high volume of patients is covered by Medicare, these fluctuations can determine whether a practice can afford to hire additional staff or invest in new technology.
Furthermore, the Society’s focus on the Medicare Economic Index (MEI) reflects a broader movement within the medical community to seek stability. The current system of annual "fixes" and last-minute Congressional patches creates a climate of financial uncertainty. A permanent inflationary update would provide the predictability necessary for long-term clinical planning and investment.
Conclusion and Future Outlook
The Endocrine Society’s submission to CMS represents a critical defense of the endocrinology profession and the patients it serves. By advocating for the recognition of FNA equipment costs, defending the integrity of complex care reimbursement through G2211, and opposing cuts to Modifier 25, the Society is working to ensure that the regulatory environment supports high-quality, specialized care.
As the medical community awaits the final rule in November, the focus shifts toward Capitol Hill. The Society remains committed to working with lawmakers to address the structural flaws in the Medicare payment system. The goal remains clear: a sustainable reimbursement model that reflects the true cost of care and values the expertise of specialists who manage some of the most challenging chronic conditions in modern medicine.
For those interested in the granular details of the Society’s recommendations, the full comment letter is available for public review on the Endocrine Society’s advocacy website. This document serves as a roadmap for the organization’s ongoing efforts to influence federal policy and protect the future of endocrine health.
