CMS Wants Tech-Enabled Care. CMS Also Wants to Unwind It. Pick One.
By: N. Adam Brown, MD, MBA and Steven Farmer, MD, PhD
On July 14, CMS released its proposed 2027 Physician Fee Schedule, the annual rule that determines how Medicare pays physicians and, increasingly, how it shapes the entire digital health economy. Most years, this rule is a technical exercise that only policy staff, physician groups, and billing consultants can be bothered to read in its entirety. This year, however, I would encourage those building or investing in remote care, staffing companies, or medical groups and hospitals to take a close look: CMS just proposed reversing course on remote patient monitoring, less than a year after moving in the exact opposite direction.
Start with the headline numbers, because physicians everywhere will feel them first. The proposed conversion factor drops to $33.17 for clinicians in advanced alternative payment models, and $32.84 for everyone else. That’s a cut of roughly 1.2 to 1.7 percent from 2026, with the main culprit being the expiration of the temporary 2.5 percent increase Congress attached to 2026 payments. Practices spent years asking for a stable inflationary update and received an increase; they were temporarily boosted and now find themselves facing an unwelcome reversal. It lands on a base that has, coincidentally or not, been thinning for a generation: adjusted for practice-cost inflation, Medicare physician pay has fallen 33 percent since 2001, even as the cost of running a practice climbed 59 percent.
It is the remote monitoring section, however, where this rule becomes deeply consequential. CMS proposes four changes, all at once:
Remote therapeutic monitoring could only be furnished to established patients. That means any practitioner billing remote physiologic or therapeutic monitoring would need to conduct a separately reportable initiating visit when the monitoring begins.
Payment would be allowed only when the monitoring work is performed by clinical staff employed by the practice, explicitly excluding services delivered by contractors.
CMS wants to revalue the codes downward because it believes the devices now cost less than originally estimated.
On top of all that, the agency is seeking comment on collapsing the seventeen existing remote monitoring codes into four bundled G codes.
Each of these proposals is defensible on its own. Together, they could substantially disrupt the operating model that most remote monitoring programs in this country actually use. I will dig into the business implications in a separate piece. Here, I want to focus on something that should concern anyone who cares about coherent health policy: the whiplash.
Just consider the timeline. In November 2025, CMS finalized the most expansion-friendly remote monitoring policy in the program’s history, with new codes allowing billing for as few as two days of patient data per month instead of sixteen, and for ten minutes of clinical management time instead of twenty. Those changes took effect January 1, 2026, at which point companies had hired against them, practices had constructed workflows around them, and investors underwrote deals on them. Now, barely six months later, the same agency proposes an employment mandate and an initiating visit requirement that would make many of those same programs unviable. Providers and innovators cannot plan capital cycles, staffing models, or patient enrollment around a payment policy that reverses course inside a single calendar year.
Here is the part I find even harder to square. Nine days before this proposed rule dropped, CMS launched the first cohort of its ACCESS Model, the ten-year Innovation Center program built to prove that technology-enabled care can manage chronic disease at scale. CMS invited roughly 150 organizations into that first cohort, including digital health companies, AI-native startups, device makers, and tech-enabled plans. The premise of CMMI’s ACCESS model is anchored on Medicare paying outside organizations, many of them technology companies rather than traditional practices, to remotely engage patients with hypertension, diabetes, musculoskeletal pain, and behavioral health conditions, and to get paid on outcomes.
One arm of CMS (CMMI) is recruiting technology companies to deliver remote chronic care to Medicare beneficiaries, while another is concurrently proposing remote monitoring under the fee schedule, only to be performed by exclusively W-2 employees of a physician practice.
You are a digital health executive trying to decide whether to invest in Medicare-facing chronic care: what signal do you take from that?
The proposed rule creates a policy tension that CMS should address. On one hand, the agency is asking technology companies to invest in a decade-long model designed to demonstrate the value of tech-enabled chronic care. On the other, it is proposing fee-for-service policies that could materially disrupt the business models many of those same companies rely upon today. That uncertainty may not doom ACCESS, but it risks discouraging the very investment and participation the model is intended to attract.
To be fair, CMS is responding to legitimate concerns.HHS's Office of Inspector General has identified remote monitoring as an area vulnerable to fraud, and utilization has grown rapidly alongside broader adoption of digital health technologies. Medicare paid approximately $536 million for remote monitoring services in 2024—a 31 percent increase over the prior year—covering nearly one million beneficiaries. Some vendor programs clearly warrant greater scrutiny and, in some cases, enforcement. Last June, the Department of Justice announced its first False Claims Act settlement involving remote monitoring, resolving allegations that a company billed Medicare for services it did not properly furnish.
The policy question, however, is whether the proposed remedy is appropriately targeted.There is an important distinction between strengthening oversight and imposing operational requirements that apply broadly across the market. An employment mandate would treat organizations that have abused the program the same as physician practices that rely on reputable external monitoring partners because they cannot recruit or retain dedicated clinical staff. Those practices—particularly in rural communities—are often the least able to absorb the operational and financial burden of bringing monitoring services entirely in-house. Rural hospitals posted a median operating margin of 3.1 percent in 2023, compared with 5.4 percent for urban hospitals, and roughly two-thirds of federally designated primary care shortage areas are rural. For many of these practices, contracting for monitoring services is not simply a matter of convenience; it may be the only practical way to offer remote monitoring at all. Ironically, these are also the communities that stand to benefit most from technologies designed to extend access to specialty and chronic disease management.
This is a proposed rule, not a final one. CMS is required to read and respond to comments, and on issues like this, comments change outcomes. The comment period runs sixty days and closes in mid-September, with the final rule expected around November and an effective date of January 1, 2027. Submissions go through regulations.gov under docket CMS-1848-P.
If you run a remote monitoring program: submit data on your clinical outcomes, your staffing structure, and what the employment requirement would do to patient access. If you are a physician practice that relies on a monitoring partner: tell CMS what happens to your patients if that partnership becomes unbillable (i.e. unviable). If you are a health system, an investor, a staffing organization, or a patient advocacy group, explain the operational reality on the ground. Vague objections get discarded; specific, evidence-backed comments get quoted in final rules.
CMS is asking a real question about integrity in remote monitoring, and that question deserves a serious answer. The industry should respond with evidence, not blanket outrage—demonstrating where oversight is needed, where existing models are working, and how targeted safeguards can address abuse without unnecessarily limiting patient access. But the agency also needs to hear, clearly and from many voices, that preserving program integrity and fostering innovation are not mutually exclusive. If CMS wants innovators to bet a decade on technology-enabled care through ACCESS, it should ensure that its fee-for-service policies do not unnecessarily destabilize the ecosystem those same innovators depend upon today. Policy that points in two directions at once gets you nowhere. Tell them so, on the record, before September.
Adam Brown, MD, MBA is a physician, healthcare executive, and business professor. He is the founder and managing partner of ABIG Health, a Washington, D.C.-based healthcare strategy firm.
Steven Farmer, MD, PhD is a cardiologist and senior partner at ABIG Health. He serves as a Senior Advisor at the Duke-Margolis Institute for Health Policy and previously served as Chief Strategy Officer for Coverage at the Centers for Medicare & Medicaid Services (CMS).
