JotPsych Notes

How to check your charges against the Medicare fee schedule

Medicare pays the lower of your charge and its rate. Any charge below the 2026 rate caps your payment, so set each charge at or above that rate.

Chris Hume
Head of Growth and Operations, JotPsych

You're setting next year's charges. Some codes still carry a charge you entered years ago.

How Medicare sets a payment from your charge and its rate

Medicare's payment rule in the Code of Federal Regulations, 42 CFR 414.21

Charge at or above the rate

Your charge: at or above Medicare's rate

Payment based on: Medicare's rate

Charge below the rate

Your charge: below Medicare's rate

Payment based on: your charge

Two charges, one at or above Medicare's rate and one below it, under the payment rule in 42 CFR 414.21. One low charge lowers the payment on every visit billed with it.

Pull your most-billed Medicare codes. For each code, such as 99214 or 90837, write down the charge your practice puts on the claim.
Look up each code's 2026 rate. The Centers for Medicare and Medicaid Services (CMS) posts every rate in its fee schedule look-up tool. Enter the code, your Medicare contractor, and your locality to see the physician rate, and use the non-facility rate for visits in your own office.
Set each charge at or above the rate. Then check your commercial contracts. See whether each one pays the lower of your charge and its rate, as Medicare does under 42 CFR 414.21. If you bill one charge per code to every payer, set that charge at or above the highest rate any payer pays you.
Check again when CMS posts the final 2027 rule. CMS builds each rate from the code's relative value units, which measure physician work, practice expense, and malpractice insurance, and adjusts them for your locality. Then CMS multiplies the result by a dollar amount, the conversion factor. The proposed 2027 rule would cut that factor to $32.84 from $33.40.

Medicare's conversion factor, 2025 to proposed 2027

dollars per relative value unit, for clinicians who aren't qualifying participants in an advanced alternative payment model (a Medicare model that shares financial risk with clinicians)

$32.35

$33.40

$32.84

2025

2026

2027, proposed

Conversion factors from CMS fact sheets on the 2026 final rule and the 2027 proposed rule. Medicare's 2026 rates rose with the factor, so a charge at or above the 2025 rate can fall below the 2026 rate.

Codes such as 99214 and 90837 kept their full work values for 2026. CMS left evaluation and management visits and behavioral health services out of a 2.5% cut to work relative value units, per its 2026 final rule fact sheet.

For a physician's visit, you'll get the full rise from the conversion factor only on a charge at or above the 2026 rate. Charges between the 2025 and 2026 physician rates get part of the rise. Charges below the 2025 physician rate get none.

Enter Medicare's rates on the Payer expected rates tab in JotPsych, and a charge below a rate shows Undercharge risk.

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Sources:

42 CFR 414.21, Medicare payment basis, Electronic Code of Federal Regulations.
42 CFR 414.22, relative value units, Electronic Code of Federal Regulations.
Centers for Medicare and Medicaid Services, Physician Fee Schedule Look-Up Tool.
CMS, Calendar Year 2026 Medicare Physician Fee Schedule Final Rule (CMS-1832-F), fact sheet, October 31, 2025.
CMS, Calendar Year 2027 Medicare Physician Fee Schedule Proposed Rule, fact sheet, July 14, 2026.