Austin, Texas – September 24, 2026 -- A proposed Medicare payment change involving Modifier 25 would reallocate approximately $889 million in annual fee-for-service payments, with private practices and solo physicians absorbing $724.4 million, or 81.5%, of the modeled reductions, according to a new analysis from Jiro Health.
Six specialties bear 82.3% of the total reduction
Jiro's Practice Impact Analysis, titled "Who Pays for CMS's Modifier 25 Proposal?", found that six medical specialties account for roughly $732 million of the modeled impact. Dermatology alone represents $395.4 million, or 44.5% of the total reallocation. Podiatric medicine and surgery, orthopaedic surgery, otolaryngology, ophthalmology and family medicine together account for an additional $336 million.
CMS proposal would cut payment for same-day dual services by 50%
Under the proposed 2027 Medicare Physician Fee Schedule, when a separately identifiable office or outpatient evaluation and management service is delivered alongside a procedure carrying a 0-, 10- or 90-day global period, CMS would pay the highest-valued service in full and reduce each other qualifying service by 50%. Modifier 25 is used to flag that a significant, separately identifiable E/M service occurred on the same day as another procedure.
Analysis draws on claims from 67,018 billing NPIs
Jiro applied the CMS-proposed methodology to de-identified Medicare fee-for-service claims covering October 2024 through September 2025, identifying $888,966,052 in annual modeled reductions across the Physician Fee Schedule. Private-practice classifications included confirmed private practices, practices without a hospital or health-system affiliation, and solo physicians billing under individual NPIs.
CEO says the change is far larger than a technical payment adjustment
"This proposal is often discussed as a technical payment change. The data shows something much larger: a nearly $1 billion annual impact concentrated among private practices and a small number of specialties," said Greg Field, CEO of Jiro Health. Eric Mann, MD, an ophthalmologist and Jiro Clinical Advisory Board member, noted the change could also affect patient care flow, citing the example of a foreign-body removal during an eye exam.
More than 10,000 public comments logged, 85% opposed
CMS's public comment period on the proposal closed September 14. Jiro's review of the public docket identified more than 10,000 comments referencing Modifier 25, with roughly 85% containing explicit language opposing the change. CMS is expected to issue the final 2027 Physician Fee Schedule this fall, with any finalized changes taking effect January 1, 2027.