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AMA Urges CMS to Correct $1 Billion Medicare Payment Error Tied to G2211 Utilization Miscalculation
The American Medical Association (AMA) has formally requested that the Centers for Medicare & Medicaid Services (CMS) rectify a significant error in the 2024 Medicare Physician Fee Schedule that could impact physician reimbursement by as much as $1 billion. The issue stems from an overestimated projection regarding the use of the new billing code G2211, which CMS introduced to reflect the complexity inherent in certain office visits.
In a letter to CMS, the AMA urged an adjustment to the 2026 Medicare conversion factor to account for a budgeting miscalculation that stemmed from faulty assumptions in CMS's 2024 final rule. CMS had originally projected that G2211 would be billed in 38% (blended) of all office visits (higher for primary care/lower for specialists). However, based on actual Medicare claims data from the first three quarters of 2024, the code was only reported with 10.5% of office visits. If the current trend holds, total 2024 utilization is expected to be just 11.2%— less than a third of the original estimate.
This substantial disparity has direct consequences for physician payment. CMS applied a 2.18% budget neutrality adjustment to account for the anticipated cost of G2211 utilization when finalizing the 2024 Medicare Physician Fee Schedule. In reality, the much lower use of G2211 indicates that the adjustment should have been closer to 0.79%. As a result, physician reimbursement was reduced more sharply than necessary— by an estimated $1 billion. "The excessive reduction in physician payments was based on flawed assumptions," the AMA argued in its letter. "This miscalculation will perpetuate financial strain on physicians and health systems unless CMS takes corrective action in the upcoming 2026 payment rule."
The AMA is calling on CMS to correct this error by adjusting the 2026 conversion factor accordingly, which would help restore air compensation and address the unintended budgetary imbalance. Without this fix, physicians could continue to face lower reimbursements based on outdated utilization projections, potentially affecting patient access and practice sustainability. The issue underscores the importance of CMS using real-time claims data when implementing and adjusting policies that have far-reaching implications for the U.S. healthcare system. The IMA will continue to closely monitor this issue and provide updates once CMS responds.
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