CMS Proposes Ending Medicare Payment for Vendor-Run Remote Monitoring

The Centers for Medicare & Medicaid Services on Tuesday proposed to stop paying for remote patient monitoring services that physician practices outsource to third-party vendors, part of its proposed 2027 Medicare Physician Fee Schedule.

According to the CMS fact sheet, the agency would only allow payment for remote physiologic monitoring (RPM) or remote therapeutic monitoring (RTM) services when they are performed by clinical staff employed by the practice, and not when the services are delivered by contractors. The proposals would apply to services on or after January 1, 2027, if finalized.

What CMS proposed

CMS described RPM and RTM as two code families for certain remote monitoring services for which it has recently established payment. Besides the staffing requirement, CMS proposed that:

• RTM services be furnished only to established patients.
• Practitioners reporting RPM or RTM furnish a separately reportable initiating visit when the services begin.
• The services be revalued, because CMS said it understands the devices may be available at a lower cost than its initial estimates.

CMS said it also considered, and is seeking comments on, bundling the RPM and RTM CPT codes into four new HCPCS G-codes. The agency said that approach would address recommendations from recent Office of Inspector General reports that it does not believe can be fully resolved under the current coding structure.

The staffing rule does not require clinical staff to be on site or patients to come into the practice, according to TechTarget's account of the proposed rule, but it would bar billing for RPM or RTM work performed by contracted companies. TechTarget quoted the rule as stating that outsourcing to a third party "can fragment care, lead to insufficient involvement and oversight of the billing practitioner, or result in services that do not actually represent or facilitate all required aspects of RPM or RTM services." The publication reported that CMS pointed to unsolicited "cold calling" of Medicare enrollees as one reason for the proposal, and that a 2024 OIG report found 43% of enrollees who received RPM in 2022 did not receive at least one of its three components.

Industry reaction

Christopher Adamec, executive director of the Alliance for Connected Care, told TechTarget the proposal would make RPM harder to offer, especially for smaller, lower-resourced and rural organizations. "What CMS has done in this rulemaking is just like cutting off the entire arm, because this ends RPM, both high quality and low quality," he said. CMS is asking for comment on how often third-party billing now occurs and how the policy could affect access, according to TechTarget.

Other proposals

The proposed rule would set a 2027 conversion factor of $33.17 for qualifying alternative payment model participants and $32.84 for other clinicians, decreases of 1.19% and 1.68% from current levels, which CMS attributed in part to the expiration of a one-year 2.5% increase for 2026. It would also implement Consolidated Appropriations Act, 2026 changes to the Clinical Laboratory Fee Schedule, phasing in payment reductions from private-payer rate data of up to 15% a year through 2029, and includes a request for information on duplicate laboratory testing, imaging and result sharing.