The Service Line

The wait is over, and the answer cost physicians more than the July proposal did. On November 4 the Centers for Medicare and Medicaid Services (CMS) released the final 2027 physician fee schedule and hospital outpatient and surgery center rules, and a home health final followed with a 2.4 percent aggregate increase. Last Sunday we told you none of the three had posted and the year was 61 days out. This week five of our six Service Line deep dives ran: radiology on Tuesday, orthopedics on Wednesday, women’s health on Thursday, emergency and hospital medicine on Friday, and pharmacy on Saturday. The Monday nephrology and dialysis issue did not publish, and we would rather say so than imply a full six. Below are the five items a cross-specialty operator should not have missed, each re-checked against a source this run where we could, plus one connective insight. Confidence: High on the outage note and the release dates; other levels stated per item.

Every Medicare-billing specialty: the 2027 finals are out, and the conversion factor fell further than proposed

The final non-qualifying conversion factor, the dollar multiplier on every relative value unit, is $32.63, against the $32.84 CMS proposed in July and $33.40 today. That is a 2.31 percent cut on our arithmetic from $33.40; the American College of Cardiology summary reports $32.6286 and a 2.36 percent decrease, so check the CMS fact sheet before you publish a percentage. The one-year 2.5 percent increase for 2026 expired, per Radiology Business. Specialty detail from our issues this week: orthopedic total knee and hip surgeon work value finalized at 16.70, above the 15.94 and 15.37 proposed but below 19.11 now, and the ambulatory surgery center update is 2.3 percent. CMS also paused surgical global-period visit data collection while saying paid follow-up visits “are not occurring,” and posted imputed values it may use to reprice 10 and 90-day globals. Budget on $32.63, then reprice surgeon pay and facility contracts before January 1. Confidence: High on the release date and the $32.63 figure across sources; Medium on specialty values, which we read in trade reports in Wednesday’s issue and did not re-fetch. Sources: AHA summary of the November 4 release, American College of Cardiology.

Home health: the final rule holds 2.4 percent, with a 3 percent temporary cut inside it

Home Health Care News reports CMS finalized a 2.4 percent aggregate increase over 2026, the same headline as the July proposal, with a temporary minus 3 percent adjustment to the 2027 national standardized rate inside it. The 30-day payment unit and the case-mix model carry forward, CMS did not finalize a home health-specific wage index, and CMS can now make Medicare enrollment revocations take effect as of the date noncompliance began. We could not confirm the final low-utilization payment adjustment thresholds, and one source describes a 2.1 percent per-visit figure, so read the rate tables before modeling an agency. The retroactive revocation language is the one to give your compliance lead: a billing problem found later can now reach back to when it began. Confidence: Medium, one trade report of a rule we did not read at the source.

Hospice and home health: the enrollment freeze lapses November 12 or 13, and no extension notice has posted

We said last Sunday the freeze ends this week with no extension announced. That is still the state of play. The searches this run show CMS imposed the two six-month nationwide moratoria on May 13, may extend them in six-month increments, and says it will publish any extension or lifting in the Federal Register. Sources disagree on the exact expiration, November 12 or 13, and we found no notice. Commentators expect an extension, but that is expectation, not announcement. Your plan has to cover both outcomes: new enrollment and majority ownership changes stay frozen into mid-May 2027, or applications reopen within days. Check the Federal Register on Monday and Tuesday. Confidence: High that no extension notice turned up in our search; Medium on the extension outlook. Source: Mintz summary of the moratoria, Home Health Care News analysis.

Cardiology: the moderate aortic stenosis trial came in positive on events, flat on death

We flagged the PROGRESS trial last Sunday, and it was presented November 2 and published in the New England Journal of Medicine. Among 744 patients with moderate aortic stenosis and at-risk features, valve replacement with Edwards Lifesciences’ Sapien 3 produced death or heart-failure events in 16.7 percent versus 23.9 percent for clinical surveillance at two years, with heart-failure hospitalizations falling from 14.9 percent to 7.4 percent. All-cause mortality at two years was similar between the groups, and 57 percent of the surveillance arm had a delayed replacement within two years. Edwards funded the trial and still labels this use investigational, and the presenters said the findings do not mean every moderate patient needs a valve. For a structural heart program, this widens the referral pool for imaging and heart team review before it widens Medicare coverage, since the national coverage analysis we covered in October concerns aortic regurgitation. Confidence: High on the reported figures across the Edwards release and trade coverage; Low on any coverage consequence. Sources: Edwards Lifesciences release, TCTMD.

Pharmacy and deals: CVS splits its drugstores from its benefit manager, and two specialty deals show what buyers are paying for

CVS Health said November 4 it will separate into two public companies by the first half of 2028, with Aetna and the benefit manager CVS Caremark staying together and about 9,000 stores, mail pharmacy and MinuteClinic going to a new CVS Pharmacy. Fierce Healthcare reports shares fell 12.6 percent and that no pro forma financials or separation costs have been given, and the split does not separate the insurer from its benefit manager. Two items from Saturday’s issue travel with it: the Labor Department’s final benefit manager fee disclosure rule, effective January 4, 2027 per law firm summaries, and a House Oversight inquiry into audits of independent pharmacies. On deals, Cencora’s roughly $2.4 billion bid for American Oncology Network includes about $2.3 billion at closing and up to $100 million in contingent value rights per the Cencora filing, still needs stockholder approval and regulatory clearance, and has no confirmed close date. RadNet’s October 26 agreement for teleradiology firm Onrad prices at about 5.4 to 5.8 times first-year adjusted EBITDA on the cash alone, our arithmetic from the company’s figures in Tuesday’s issue, not re-fetched. Confidence: High on the CVS structure and Cencora terms; Medium on the Labor Department details, law firm summaries of a rule text we could not read; Low on any network contract effect.

Connective tissue: CMS is repricing the bundle, and every specialty holds a piece of it

Read the week as one policy move. Obstetrics loses its global delivery package on January 1 to separate prenatal, delivery and postpartum codes, and PYA’s modeling puts about 4 fewer work value units against the 37 the global code credits today, per Thursday’s issue. Surgeons keep their global periods for now, but CMS paused the visit data and says paid post-operative visits are not occurring, which reads as groundwork for repricing. Emergency departments gain accreditor checks of federal emergency-care paperwork. Home health gets retroactive revocation. In each case the unit CMS pays, audits or revokes is getting smaller and more traceable, which favors practices that can document every visit and every site. The operator action is the same everywhere: record the work the bundle used to hide, such as post-operative visits under CPT 99024, prenatal visit counts and on-call logs, before a payer or surveyor asks for it. Confidence: Medium, our synthesis of the sourced items above, not a sourced finding.

This Week’s Operator Metrics, At a Glance

• Radiology and imaging: about 5.4x to 5.8x EBITDA, RadNet’s cash price for Onrad, our arithmetic (not re-verified this run).
• Orthopedics: about $93 of surgeon work value lost per Medicare knee or hip at final values, our arithmetic on work value units only (not re-verified this run).
• Women’s health: about 4 fewer work value units per vaginal delivery against 37 today, per a PYA model reported in trade press (not re-verified this run).
• Emergency and hospital medicine: minus 2.31 percent conversion factor, about $231,000 per $10 million of Medicare professional payments (arithmetic confirmed this run at $32.63).
• Pharmacy: 5 percent, the variance a benefit manager must explain under the Labor Department rule per law firm summaries (not re-verified this run).
• Nephrology and dialysis: no issue published this week.