CMS Proposes Higher Medicare Payment for Psychiatric Collaborative Care in 2027

What Are the 2027 Behavioral Health Billing Changes in the Proposed Rule?

As of July 14, 2026, the CMS 2027 Medicare Physician Fee Schedule proposed rule (CMS-1848-P) includes work RVU increases for Psychiatric Collaborative Care Model (CoCM) and behavioral health integration codes, an exemption for behavioral health services from the negative 2.5 percent efficiency adjustment applied to most other specialties, and an extension of the in-person visit waiver for mental health telehealth through December 31, 2027. For psychiatry practices billing Medicare, these provisions represent a direct reimbursement increase and billing simplification if finalized.

• CoCM payment is going up. CMS proposes higher work RVUs for collaborative care management codes, increasing the Medicare value of one of the most evidence-based models for integrating psychiatry into primary care.
• Behavioral health is exempt from efficiency cuts. The negative 2.5 percent efficiency adjustment that reduces work RVUs for most non-time-based codes does not apply to behavioral health services, including psychotherapy and E/M visits.
• Telehealth flexibility continues through 2027. The in-person visit requirement for mental health telehealth remains waived through December 31, 2027, under Section 6209(c) of the Consolidated Appropriations Act, 2026.

What CMS Proposed on July 14

CMS released the CY 2027 Physician Fee Schedule proposed rule (CMS-1848-P) on July 14, 2026. The rule covers payment policies for all Medicare Part B services effective January 1, 2027. Within the roughly 2,000-page proposed rule, three provisions directly affect how psychiatry practices bill and get paid.

First, CMS proposes to increase the work relative value units (RVUs) for the Psychiatric Collaborative Care Model codes and related behavioral health integration codes. These codes, which include CPT 99492, 99493, 99494, and G2214, cover the work of a psychiatric consultant providing recommendations to a primary care team managing patients with behavioral health conditions. CMS is accepting the RUC-recommended increases for these codes, which reflect the actual physician time and complexity involved in collaborative care. The Bipartisan Policy Center noted in its July 2026 analysis that this would “meaningfully increase how Medicare values collaborative care.”

Second, CMS exempts time-based behavioral health services from the negative 2.5 percent efficiency adjustment applied to work RVUs across most other service categories. This exemption covers psychotherapy codes such as 90832, 90833, 90834, 90836, 90837, and 90838, as well as E/M visits, care management services, and services on the CMS telehealth list. For psychiatry practices, this means your reimbursement is protected from a cut that is reducing payments for most other specialties.

Third, CMS proposes conforming regulatory changes to implement Section 6209(c) of the Consolidated Appropriations Act, 2026, which extends the in-person visit waiver for mental health telehealth services through December 31, 2027. Medicare patients receiving psychiatric services via telehealth will not be required to have had a prior in-person visit with the treating provider during this period.

Does This Affect My Psychiatry Practice?

If your practice bills Medicare Part B for psychiatric services, collaborative care management, or telehealth-based mental health visits, these provisions apply directly. The scope includes psychiatrists, psychiatric nurse practitioners, clinical psychologists, licensed clinical social workers, and any provider billing under the PFS for behavioral health services.

The CoCM payment increase is most relevant to psychiatrists who serve as consulting providers in a collaborative care arrangement with primary care practices. This model has been growing since CMS first recognized CoCM codes in 2017, but reimbursement has lagged behind the actual work involved. The proposed RVU increase addresses that gap. Practices already billing CoCM codes will see higher payments per encounter if finalized. Practices that have not adopted the collaborative care model now have a stronger financial incentive to do so. Understanding the full range of psychiatric consultation codes is the first step.

One question we hear constantly from psychiatry practice managers is whether CoCM codes are worth the administrative complexity. The answer depends on whether your billing team understands the documentation requirements and time tracking that Medicare demands. Across the billing companies we vet for psychiatric practices, those with CoCM experience consistently deliver higher first-pass clean claim rates on these codes because they know exactly what the MAC expects.

How Will These Changes Affect Psychiatry Reimbursement?

The combined effect of the three provisions creates a meaningful reimbursement advantage for psychiatry relative to most other specialties in 2027. While the overall conversion factor is decreasing, the behavioral health exemption from the efficiency adjustment and the CoCM RVU increases partially or fully offset that decrease for psychiatry-specific services.

To illustrate: a non-behavioral-health specialty billing a non-time-based procedure in 2027 would face both the conversion factor decrease (1.19 to 1.68 percent depending on APM status) and the 2.5 percent efficiency adjustment on work RVUs, resulting in a combined payment reduction. A psychiatry practice billing psychotherapy or collaborative care codes would face only the conversion factor adjustment, with no efficiency reduction. On CoCM codes specifically, the higher work RVUs would produce a net payment increase even after the conversion factor decrease.

The important detail for billing teams is that the exemption applies to the service, not the provider. A psychiatrist billing a non-exempt service would still face the efficiency adjustment on that specific code. The protection is code-level, not specialty-level.

What Should Psychiatry Practices Do Before January 2027?

The rule is proposed, not finalized. CMS will accept comments through September 2026 and publish the final rule in late fall. But preparation should start now.

• Review your current CoCM billing. If your practice already bills 99492, 99493, 99494, or G2214, confirm that your documentation meets Medicare requirements for time tracking, caseload documentation, and consulting psychiatrist involvement. Higher RVUs attract more audit scrutiny.
• Evaluate whether to add CoCM to your service mix. Practices that have not adopted collaborative care now have a stronger reimbursement case. The model requires a consulting arrangement with a primary care practice and a care manager, but the financial return improves under the proposed RVUs.
• Confirm your telehealth billing is current. The in-person visit waiver extends through December 31, 2027, but your billing team needs to verify that telehealth claims are coded correctly with the appropriate POS codes and modifiers. Incorrect telehealth billing remains one of the top denial drivers for psychiatric practices.
• Verify behavioral health codes are flagged as exempt in your billing system. When the final rule takes effect, your practice management system needs to apply the correct RVUs to exempt versus non-exempt codes. If your system does not update automatically, your billing company should handle the mapping.
• Submit comments to CMS if the proposals affect your practice. The comment period for CMS-1848-P closes in September 2026. CMS considers stakeholder feedback before finalizing payment rates and policy changes.
• Audit your Medicaid behavioral health billing alongside Medicare. Review your Medicaid billing processes to anticipate how Medicare payment methodology changes will flow through to managed care contracts. Medicaid managed care plans often mirror Medicare payment methodology with a lag. Understanding the Medicare direction helps you anticipate Medicaid contract negotiations.

Common CoCM Billing Mistakes

Providers often come to us after losing revenue on collaborative care codes because the billing was set up incorrectly from the start. These are the patterns we see most often.

• Billing CoCM without a qualified care manager. Medicare requires that a designated care manager (typically a nurse, social worker, or psychologist) maintain a registry and provide structured follow-up. If the care manager role is not formally documented, the entire claim is at risk.
• Underdocumenting the consulting psychiatrist’s time. CoCM codes are time-based. The psychiatric consultant’s time reviewing cases, making recommendations, and communicating with the care team must be tracked and documented per encounter. Vague notes like “reviewed patient chart” do not meet the documentation standard.
• Confusing CoCM codes with general behavioral health integration (BHI) code G2214. G2214 is a general BHI code for practices that do not meet the full CoCM model requirements. It reimburses at a lower rate. Billing G2214 when you qualify for the full CoCM codes leaves money on the table. Billing CoCM codes when you only qualify for G2214 creates a compliance risk.
• Not tracking the 70-minute cumulative threshold. CoCM code 99492 covers the initial 70 minutes of collaborative care management per calendar month. 99493 covers each subsequent 60-minute block. Billing these codes without accurate cumulative time tracking across the month produces denials and audit findings.

Frequently Asked Questions

Next Steps

Start by reviewing whether your practice currently bills CoCM codes or qualifies to do so. If the proposed RVU increases are finalized, collaborative care will become one of the higher-value billing opportunities in outpatient psychiatry.

For practices that need a billing partner with psychiatric specialty experience, Psychiatry Billers connects you with vetted billing companies that understand CoCM documentation, behavioral health code exemptions, and the 2027 payment changes. The matching process is free and takes roughly 30 minutes.