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The Centers for Medicare and Medicaid Services finalized sweeping Medicare payment reforms it says will shift the program from volume-based "sick care" toward prevention, primary care and accountable care. The 2027 Medicare Physician Fee Schedule rule includes a roughly 2% reduction in baseline physician payment rates with targeted increases and new payment opportunities for accountable care, primary and chronic care and behavioral health. CMS also finalized a proposal that will prevent providers from using third-party vendors or contractors for RPM services, but the agency provided a two-year reprieve on the requirement as it goes into effect Jan. 1, 2029, "giving practices that rely on contractors two additional years to adapt," CMS said.
About two years after rumors emerged that CVS Health is exploring a breakup, the healthcare giant is finally making it official. But while vertical integration as was envisioned — with retail pharmacy, PBM and insurer all coming under one banner — may be dying a natural death, observers believe the conflict of interest issue is still left unaddressed. On Wednesday, the company announced that in the first half of 2028, it will split into two separate companies.
‘We’ve already cut to the bone’: Health system cost-cutting reaches its limits
As health systems face mounting financial pressures—including declining Medicaid coverage and rising uncompensated care—executives emphasize that cost-cutting alone is no longer enough to achieve sustainability. Instead, organizations are shifting their strategies toward administrative streamlining, back-office restructuring, and expanding into lower-cost outpatient care settings like ambulatory surgery centers.
Medicare Part D premiums projected to rise 50% in 2027 without plan switching: KFF
Medicare beneficiaries who remain in their current stand-alone Part D drug plans could face sharply higher premiums in 2027 if they don’t switch to lower-cost plans during open enrollment, according to a KFF analysis. The average monthly premium for stand-alone prescription drug plans, or PDPs, is projected to rise 50% in 2027, if current enrollees remain in the same plans. CMS projected a much smaller increase in the national average Part D premium, from $35 to $36. KFF noted that CMS, which based its estimate on September 2026 enrollment, did not explain its calculation methodology.
CMS ups hospital outpatient pay 2.3%, cuts 340B rates in 2027: 15 notes
CMS finalized its 2027 hospital outpatient and ASC payment rule Nov. 4, cutting payment for 340B-acquired drugs, expanding site-neutral payments to imaging and continuing to phase out the inpatient-only list. Outpatient payment rates will rise 2.3% in 2027 for hospitals that meet quality reporting requirements. CMS will pay for 340B-acquired drugs at average sales price minus 28% in 2027. CMS estimates the policy will cut Medicare drug spending by $4.35 billion and beneficiary costs by $1.1 billion in 2027, about $5.45 billion in total.
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