The American Academy of Dermatology Association says Medicare’s 2027 physician payment rule could squeeze services used to detect and treat skin cancer, even after regulators narrowed a proposed reduction for care delivered on the same day. The rule is scheduled to take effect Jan. 1, 2027.
The Centers for Medicare & Medicaid Services (CMS) finalized a payment reduction when the same physician or practice bills separately for an office or outpatient evaluation and management visit and a procedure with a 0-day global period on the same day. Medicare will pay the highest-priced service at 100% and other services at 80%. The proposal would also have covered procedures with 10- and 90-day global periods and paid the other services at 50%.
The rule also changes how CMS calculates practices’ indirect expenses. The agency will phase out its indirect practice cost index over two years and use a stabilizer intended to limit short-term volatility. CMS says the changes will rely less on older specialty-level cost data and make payment rates more responsive to costs.
Murad Alam, president of the American Academy of Dermatology Association, said the same-day reductions and practice-expense changes could affect services used to find and treat skin cancer early. He warned that they could bring “the largest cut ever imposed on skin cancer care,” though the association’s statement did not give a skin cancer-specific payment estimate.
Dermatology Times reported that the association’s initial estimate put the overall payment reduction for dermatologists at about 6% in 2027. The outlet said the AADA was conducting a fuller analysis.
CMS says the rule is intended in part to reduce duplicate payments when a visit and procedure occur together.
