What to Know

• The end of global OB billing could reshape reimbursement, productivity, and care delivery economics across your organization.
• Waiting for payer guidance may leave providers unprepared for significant financial and operational impacts.
• Organizations that model reimbursement changes, assess staffing implications, and review contracts now will be better positioned for 2027.

Note: ECG is closely monitoring emerging information on the OB billing change. As of mid-July, CMS is seeking comments on the most effective implementation process. The draft fee schedule has put forward G-codes in place of the existing global codes. While the final rule will not be available until December, we believe the ACOG-recommended principles related to the change remain valid and will be implemented eventually, though potentially delayed. Either way, organizations should have a proactive transition plan that models potential impacts on compensation or productivity and considers the associated operational implications.

The 2027 CMS obstetric (OB) billing changes collectively represent one of the most significant shifts in OB reimbursement in decades. While commercial payers have released limited information regarding their plans for implementation and execution, the transition away from the global billing structure will likely create reimbursement shifts for providers depending on contract terms, methodologies, and care delivery models.

Here are three ways providers can prepare for any potential financial and operational implications before payers introduce the new changes.

1. Model the Impact of the Changing Reimbursement Mix

Historically, a significant portion of OB reimbursement has been concentrated within the global OB codes, though it is now shifting toward separately billable services. The impact will vary based on payer reimbursement methodologies, contracted fee schedules, and the relative reimbursement rates assigned to individual services relative to global OB codes. This variability underscores the importance of understanding payer-specific fee schedules and modeling the financial impact of reimbursement changes to understand the full impact of potential implications.

If modeling identifies a reimbursement shortfall under the new payment structure, providers should evaluate opportunities to renegotiate existing rates, update fee schedules, or otherwise address the gap with affected payers.

Example: Under the historical payment model, a provider may have received $3,000 for a global OB episode. Under the revised reimbursement structure, the same episode may be paid through a combination of services, such as 12 prenatal E&M visits at $150 each ($1,800), delivery services at $1,000, and postpartum care at $300, resulting in a total reimbursement of $3,100. Alternatively, if E&M visits are reimbursed at $100 per visit, total reimbursement would decrease to $2,500.

2. Evaluate APP Staffing Models

Under global billing, the differences in reimbursement between physicians and APPs may have been less visible. However, as reimbursement becomes tied to individual encounters rather than a global code, organizations that rely heavily on NPs, PAs, CNMs, and other APPs for prenatal care may experience greater sensitivity in commercial payer reimbursement policies.

Many commercial payers reimburse APP services at a lower rate than physician services. As a result, even small reimbursement differentials could have a meaningful financial impact. Providers should evaluate how prenatal care is currently staffed and assess the potential revenue implications of their existing care model.

Example: Under the historical global billing model, a provider may have received a $3,000 global OB payment regardless of whether prenatal visits were performed by a physician or an APP. Under the revised encounter-based reimbursement model, the same pregnancy may include 12 prenatal visits, with reimbursement tied to the rendering provider.

If physician visits are reimbursed at $150 per visit and APP visits are reimbursed at 85% of the physician rate ($127.50), a pregnancy managed entirely by a physician would generate $1,800 in prenatal visit reimbursement, while one managed entirely by an APP would generate $1,530. Across 1,000 pregnancies annually, this difference could result in an approximate decrease in prenatal visit reimbursement of $270,000.

3. Review Contract Pricing for New Codes

Existing contract language should be reviewed to determine how payers will reimburse new codes that are not specifically included in the current fee schedules. A payer contract may reimburse existing delivery services at negotiated rates that are above the payer’s standard rates. If the contract defaults to a percentage of Medicare or another standard methodology to reimburse new codes, the payment may differ significantly from the rates providers expect based on existing OB services. Providers should evaluate provisions, reimbursement methodologies, and fee schedule updates related to newly established CPT codes to understand how they will be priced following the implementation of any new policies.

This transition also presents providers with an opportunity to review and identify payer agreements that are approaching renewal and evaluate whether reimbursement provisions should be updated through renegotiation. Organizations may be able to address any gaps in reimbursement, improve pricing for newly established services, or clarify how future code changes will be incorporated into the contract.

Example: If existing OB services are reimbursed at 120% of the fee schedule and a new L&D code defaults to 100% of the fee schedule, a code with a $1,000 fee schedule amount would reimburse $1,200 under the historical methodology but only $1,000 under the default methodology, representing a 16.7% decrease in reimbursement.

The OB Billing Transition Is Coming. Are You Ready?

The 2027 CMS OB billing changes represent more than a coding update. The shift from global billing to separately reimbursed services may have meaningful reimbursement and operational implications that vary across payers and provider organizations. As commercial payers release additional guidance, providers should proactively evaluate contract terms, reimbursement methodologies, staffing models, and potential revenue impacts to position themselves for a successful transition. Maintaining open communication with payer representatives and monitoring payer policy updates will be critical to understanding how these changes will be implemented and reimbursed.

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