On November 24, 2025, NeuroPace announced that the Centers for Medicare & Medicaid Services had finalized two Medicare reimbursement rules that will increase payments for its Responsive Neuro‑Stimulator (RNS) System implant and replacement procedures, effective January 1, 2026. The Physician Fee Schedule (PFS) final rule, issued on October 31, 2025, raises the professional payment for the initial implant by 43% (about $530) and the replacement by 45% (about $260). The Outpatient Prospective Payment System (OPPS) final rule, issued on November 21, 2025, moves RNS replacement procedures (CPT 61891) from APC 5464 to APC 5465, the highest‑paying neurostimulator level, lifting the average hospital Medicare reimbursement for replacements from $21,444 in calendar year 2025 to $31,526 in 2026—a 47% increase.
The 43% and 45% professional payment increases translate into a $530 and $260 boost per procedure, respectively, on top of the existing rates. Compared with the prior year’s professional payment for the initial implant, which was $1,230, the new rate of $1,760 represents a substantial margin expansion for physicians. For replacements, the jump from $580 to $840 per procedure not only improves physician reimbursement but also signals CMS’s recognition of the higher resource intensity required for replacement surgeries, which are typically more complex than initial implants.
The APC shift to level 5465 is significant because APC categories reflect the complexity and resource demands of outpatient procedures. APC 5464 is the second‑highest level for neurostimulators, while APC 5465 is reserved for the most resource‑intensive cases. By reclassifying RNS replacements to APC 5465, CMS acknowledges the advanced technology and multidisciplinary care involved, and the resulting $10,082 increase in hospital reimbursement per replacement aligns the payment with the true cost of care. This change is expected to encourage more hospitals to offer RNS replacements, thereby expanding the market for NeuroPace’s device.
NeuroPace’s financials underscore the importance of these reimbursement gains. In Q3 2025, the company reported $27.4 million in revenue—a 30% year‑over‑year increase—and a net loss of $3.5 million. The company’s guidance for full‑year 2025 revenue was raised to $97–$98 million, reflecting confidence in continued growth. The higher Medicare payments are projected to improve the margin profile of replacement procedures, which are becoming a larger contributor to the business, and to support neurosurgeon adoption of the RNS System. Management expects the reimbursement changes to translate into higher procedure volumes and a stronger revenue mix.
Market reaction to the announcement was positive. Analysts noted that the reimbursement increases could lift the RNS System’s competitive position by reducing the cost barrier for hospitals and neurosurgeons. The announcement also reinforced investor confidence in NeuroPace’s growth trajectory, as reflected in the company’s recent share performance and analyst coverage.
Joel Becker, CEO of NeuroPace, said the CMS decision “better reflects the physician resources used in treating patients with RNS therapy and, over time, should further support neurosurgeon adoption and procedure growth.” He added that the reassignment of replacement procedures to the highest‑paying APC level “better reflects the hospital resources required.”
The reimbursement changes are a tailwind for NeuroPace, positioning the company to capture a larger share of the growing epilepsy treatment market and to improve profitability as replacement procedures become a more significant revenue driver.
The content on BeyondSPX is for informational purposes only and should not be construed as financial or investment advice. We are not financial advisors. Consult with a qualified professional before making any investment decisions. Any actions you take based on information from this site are solely at your own risk.