The Centers for Medicare and Medicaid Services (CMS) recently released the CY 2026 Physician Fee Schedule (PFS) Final Rule, which includes updates to the Quality Payment Program (QPP), the Merit-based Incentive Payment System (MIPS), practice expense methodology, and more.
The key takeaway for Anesthesia: Overall, we expect to see a -1% impact on revenue for Anesthesia. A slight increase in Conversion Factor (CF) will be offset by changes to RVUs and a rebalancing in practice expense methodology.
The following summary provides the detail behind those conclusions, as well as the specifics on how changes in the final rule will affect Anesthesia practices.
Physician Fee Schedule
The CY 2026 Conversion Factor (CF) increased, but not by as much as suggested in the proposed rule. The final CY 2026 CF for Anesthesia is $20.4976 for most physicians, which represents a .88% increase over 2025. New this year, CMS finalized a separate CF of $20.5998 for physicians participating in Advanced Alternative Payment Models (APMs), which is 1.39% more than the 2025 rate.
The increases are based on three factors:
- A statutory increase in the Medicare Access and CHIP Reauthorization Act (MACRA) of 0.25% for non-APMs and 0.75% for qualifying APMs
- A 0.49% positive budget neutrality adjustment
- A 2.5% one-time payment boost from the One Big Beautiful Bill Act
Efficiency Adjustment
CMS is imposing a -2.5% efficiency adjustment that will cut RVUs for non-time-based services and will offset some of the CF benefits for Anesthesia providers and groups. CMS believes that current reimbursement rates may not reflect efficiencies gained by recent technological and operational improvements in care delivery. The efficiency adjustment, based on a five-year review of Medicare Economic Index (MEI) productivity data, is intended to correct for the issue by lowering work RVUs and making corresponding updates to the intraservice portion of physician time inputs for certain services. CMS will apply the efficiency adjustment to work RVUs every three years, which will further decrease work RVUs cumulatively over time.
Practice Expense Methodology
Changes to the Practice Expense (PE) portion of RVUs will also impact revenue for anesthesiologists and other facility-based physicians. CMS is changing the way it allocates indirect PE RVUs, which reflect the administrative overhead of running a practice. (Direct PE RVUs were already calculated differently for facility-based physicians.) CMS believes the current methodology of allocating the same indirect PEs to both facility-based and non-facility-based physicians is outdated and doesn’t factor in the rise in employed physicians. The CY 2026 final rule reduces payment of services performed in facilities by 7% but will increases payment by 4% for services performed in non-facility-based settings. This change obviously impacts reimbursement for Anesthesia providers. Critically, it will also impact compensation for practices that pay clinicians based on total RVUs, as a reduction in indirect PE RVUs will bring down total RVUs.
The Cumulative Effect on Revenue
Overall, we expect to see a slight negative effect on revenue for Anesthesia. Many procedures are time-based, which will limit the impact of the efficiency adjustment, but the rebalancing of indirect PE RVUs will likely result in a -1% shift.
Teaching Physician Supervision
CMS ended virtual supervision policies in urban areas after December 31, 2025, requiring teaching physicians to be physically present with residents during key parts of care. However, virtual supervision in teaching settings is now permanently permitted when the service itself is furnished virtually.
Direct Supervision
Direct supervision may be met via real-time audio-visual communication (not audio-only) for applicable incident-to services, diagnostic tests, pulmonary rehabilitation, cardiac rehabilitation, and intensive cardiac rehabilitation. This does not include services with global surgery indicators 010 or 090.
QPP and MIPS
CMS remains committed to the Quality Payment Program (QPP) and the Merit-based Incentive Program (MIPS), and they are making few substantive changes to the program.
Here’s what Anesthesia providers need to know:
Performance Thresholds and Category Weighting
- The MIPS performance threshold will remain at 75 points through CY 2028.
- The data completeness threshold will remain at 75% for the MIPS Quality Performance Category through the CY 2028 performance period, possibly rising to 80% in CY 2029.
- There are no expected overall changes to the 2026 weighting of the four reporting categories: Quality, Improvement Activities, Cost, and Promoting Interoperability. However, qualifying for a Special Status (small, non-patient-facing, etc.) will continue to affect the weighting of categories for individuals or groups. Check your Special Status when it becomes available in December 2026 to see what may be re-weighted.
- Eligibility criteria for individuals will remain the same for 2026.
Quality Category Updates
CMS re-evaluates the list of Quality measures annually, and they have removed one measure from the Anesthesia set:
- QID424: Perioperative Temperature Management
The Anesthesia measure set is small, so the removal of this measure may have a negative impact on providers and groups. The remaining measures still stand, and they include:
- QID404: Smoking Abstinence
- QID430: Prevention of Post-Operative Nausea and Vomiting (PONV) – Combination Therapy
- QID463: Prevention of Post-Operative Vomiting (POV) Combination Therapy (Pediatrics)
- QID477: Multimodal Pain Management
The good news: The new 10-point scoring system introduced in 2025 for highly topped-out Quality measures will continue, and CMS will also apply the 10-point scale to QID430, QID463, and QID477. For a more detailed explanation of the topped-out Quality measures, please read our 2025 analysis.
Cost Category Updates
A change to the Total Per Capita Cost (TPCC) measure’s attribution will positively impact facility-based groups with nurse practitioners (NPs) and physician assistants (PAs). Historically, groups with a Special Status that exempted them from this Cost measure were seeing negative impacts when an NP or PA that didn’t qualify for Special Status inadvertently triggered the Cost measure for the whole group.
Moving forward, NPs or PAs who are part of a group where the rest of the clinicians are exempt from the measure will now also be exempt. Further, CMS has implemented a new two-year feedback-only period for new Cost measures, which will allow clinicians to review and improve without penalty before the measure officially kicks in.
MIPS Value Pathways (MVPs)
CMS is signaling that MIPS Value Pathways (MVPs) will be important in the future, although providers still have the option to report in either Traditional MIPS or the Anesthesia MVP. The same quality measure removed from the traditional set has been removed from the Patient Safety and Support of Positive Experiences with Anesthesia MVP, as well:
- QID424: Perioperative Temperature Management
Next Steps
The Ventra Health team is committed to providing the support and guidance you need to make the best decisions for your practice. For specific analysis on how these changes will impact your reimbursement and revenue, please reach out to us.
Read more about the CY 2026 Medicare Physician Fee Schedule Rule on the CMS Fact Sheet.
