A Senate Bill Would Let HHS Turn Up to 70 Percent of Medicare Primary Care Pay Into a Monthly Per-Patient Fee

The number to start with is a range: 40 to 70 percent.

That is how much of a primary care practice’s expected Medicare fee schedule revenue could arrive as a flat monthly payment per patient under S. 5269, the Pay PCPs Act of 2026. Senators Sheldon Whitehouse of Rhode Island and Bill Cassidy of Louisiana filed the text on August 5 and announced it on September 9. It carries a $10 billion appropriation and it sits with the Senate Finance Committee.

The structure will look familiar to anyone running a membership practice. Medicare pays a per-member-per-month amount for an attributed panel. Claims still cover whatever falls outside the monthly bundle. The bill calls that a hybrid payment.

Prospective primary care payment is not new to Medicare. The CMS Innovation Center has been testing versions of it for a decade. One of those tests, Making Care Primary, was a voluntary model that launched July 1, 2024 in eight states and ended early on June 30, 2025. What is new here is the vehicle. This bill would write the hybrid into the physician fee schedule itself rather than run it as a time-limited model in selected states.

What the text actually does

Section 3 lets the Secretary of Health and Human Services build hybrid payments into the physician fee schedule for primary care providers. The prospective portion “may represent between 40 and 70 percent of expected annual total allowed charges derived from the Medicare physician fee schedule,” and the bill instructs that it should exceed what those same services would have paid as claims. The range is not fixed. A following clause lets the Secretary consider percentages different from the ones specified, varying them by type of primary care provider on factors like historical fee-for-service revenue or quality performance. HHS may risk adjust the monthly amount using clinical diagnoses, demographics, and social determinants of health.

Section 4 halves it. The Secretary may cut beneficiary cost sharing under Part B by 50 percent for primary care services paid through the hybrid, on one condition: the patient has to designate a primary care provider as their usual source of care and tell Medicare who that is.

Section 5 sets up a technical advisory committee inside CMS to work on relative value units. Thirteen members appointed by the Secretary, drawn from across provider payment and including practicing primary care providers, with a CMS representative in the chair and CMS personnel doing the staff work. It advises on an ongoing basis and designs new valuation methodologies. The findings explain why: Medicare currently prices physician work starting from “subjective survey-based estimates of clinician time and effort per discrete service,” spread across more than 8,000 billing codes, an arrangement the bill says obscures pricing distortions that grow over time.

The appropriation is $10,000,000,000 for fiscal years 2027 through 2031, and the bill waives budget neutrality for it. That last clause matters more than it reads. Changes to the fee schedule that shift more than $20 million have to be offset inside the schedule itself. The bill exempts this appropriation from that test.

Two words govern the parts that matter most. The authority to build the hybrid and the authority to cut cost sharing are both written as “may,” not “shall,” and a rule of construction at the end states that nothing in the section requires a primary care provider to take the payment at all. Participation is voluntary in both directions.

The findings read like a DPC recruiting pitch

Congressional findings are usually boilerplate. These are not.

Finding two: research has shown that “25 percent or more of primary care activities are not recognized for payment under most fee schedules, including the Medicare physician fee schedule,” because those activities are high frequency and brief, and “the billing costs for submitting claims for such services would usually exceed the value of payment.”

Finding three says fee-for-service is “ill-suited” to support team-based care and care coordination.

A quarter of the work, unpaid, because billing for it costs more than the payment. That is the arithmetic every physician who left insurance ran on a napkin, printed in a Senate bill and endorsed by the American Academy of Family Physicians, the Primary Care Collaborative, and the American Association of Nurse Practitioners.

Attribution, and the part that is almost a membership

The bill’s attribution rule is two-sided. HHS identifies the relationship from historical claims data, and then “the beneficiary affirms that the provider is their primary care provider.” The cost-sharing discount in Section 4 requires the same affirmation.

Medicare attribution is ordinarily something that happens to a physician. An algorithm reads the plurality of a patient’s primary care allowed charges and assigns them to a panel, often after the fact, sometimes to a clinician the patient has seen twice. Asking the patient to confirm is a small change in text and a large change in kind. It produces a roster the patient agreed to.

Then there is Section 3(f), which strikes participating clinicians out of the Merit-based Incentive Payment System. For a physician weighing an exit from insurance, MIPS reporting is frequently the last straw rather than the first. A bill that removes it without requiring the exit is aimed squarely at the population DPC recruits from.

Who cannot collect any of this

Everything above is built on the Medicare physician fee schedule. The monthly amount is calculated as a percentage of expected allowed charges under that schedule, and the whole hybrid lives inside it.

A physician who has opted out of Medicare submits no claims and has no allowed charges. Nothing in the bill’s text addresses that population, and the eligibility definition points to practitioners and physicians furnishing primary care services under existing Medicare payment definitions. The bill never spells out the consequence, but it is hard to see what a percentage of zero allowed charges would attach to.

So the DPC practices that opted out of Medicare, the ones running a monthly fee with no claims at all, have no obvious place in the bill that borrows the structure. The eligibility definition turns on furnishing primary care services and never mentions practice model or participation status, so nothing in the text appears to shut out a DPC physician who stayed in Medicare. For them the arithmetic gets interesting. The rest would watch Medicare adopt their payment structure at a percentage the Secretary picks and keep their own at 100.

What To Watch

Three days. Comments on the CY 2027 Physician Fee Schedule proposed rule close September 14, 2026, and buried in that rule is a request for information on establishing prospective primary care payment in Original Medicare, starting with the Shared Savings Program. CMS is asking the same question this bill answers, and CMS can act on regulatory authority without waiting for Congress.

That is the nearer path. The legislative one runs through Senate Finance, which took no action on the 2024 version beyond receiving it. S. 4338 was read twice and referred on May 15, 2024, and the record shows nothing after that. A reintroduction announced in September of a midterm year is not a scheduling signal either.

Watch for a House companion, watch whether Finance schedules a markup, and watch what CMS says about prospective primary care payment in the CY 2027 final rule. If the agency moves on its own, the bill’s $10 billion becomes the thing Congress is arguing about rather than the thing that makes it possible.