On October 31, 2025, CMS released the CY 2026 Physician Fee Schedule (PFS) Final Rule. Below is a summary of the most relevant updates impacting payment, practice operations, and telehealth policies.
CY 2026 Conversion Factor (CF)
- $33.4009 for most physicians, which is a small decrease from the $33.4209 in the proposed rule.
- $33.5675 for those in Advanced APMs (new in 2026) which is a small decrease from the proposed $33.5875.
- Both represent increases over the CY 2025 CF of $32.3465 (3.26% and 3.77% increases, respectively).
- These increases are based on:
- Medicare Access and CHIP Reauthorization Act (MACRA) update (+0.25% for non-APMs, +0.75% for APMs)
- +0.49% budget neutrality adjustment
- +2.5% one-time payment boost from the One Big Beautiful Bill Act
Separate Conversion Factor (CF) for anesthesia services:
- $20.5998, a 1.39% increase for those in Advanced APMs
- $20.4976, a .88% increase for all others.
Efficiency Adjustment
CMS confirmed a 2.5% reduction for certain services based on a 5-year review of Medicare Economic Index (MEI) productivity data. This cut would apply to non-time-based services and impact work RVUs and intraservice physician time. Emergency Medicine EM codes 99281 – 99285 are excluded from this reduction. Additionally, this would not apply to care management services, behavioral health services, services on the Medicare telehealth list, and maternity codes with a global period of MMM.
Practice Expense Adjustment
CMS confirmed reductions to the PE RVUs for facility-based services. Hospital based providers will see a reduction in PE RVUs impacting Total RVU and reimbursement.
Specialty Impacts
Anesthesia
- Slight CF increase
- $20.5998, a 1.39% increase for those in Advanced APMs
- $20.4976, a .88% increase for all others
- CMS is estimating a combined impact of –1% for anesthesiology which breaks down to a 7% impact on non-facility based and –3% on facility based.
Radiology
- CMS’ estimated overall impact: –2% diagnostic, –1% nuclear medicine, +2% interventional, –1% radiation oncology. When broken down, we are expected to see a decrease across facility-based charges, but a slight increase across non-facility charges.
Hospitalist/Inpatient
- Hospitalists treating inpatient beneficiaries will face decreased reimbursement from both efficiency and practice expense adjustments, despite nominal CF increase.
- Benefit from general Conversion Factor increase (+3.26% or +3.77% for Advanced APM users)
- Reduction from efficiency adjustment (-2.5% to wRVUs)
- Reduction in indirect Practice Expense RVUs (-50%)
Emergency Medicine
Emergency Medicine will be affected by the same overarching changes. Emergency Medicine physicians will see a decrease in Observation and Critical Care CPT RVU values and reimbursement.
- CF bump (+3.77% APM or +3.26% non-APM)
- –2.5% efficiency cut to work RVUs affecting non-time-based EM components excluding Emergency E & M 99281 – 99285 (will impact procedures)
- PE rebalancing, disadvantaging facility-based services (EM codes, observation, critical care and procedures in ED)
Net likely impact: CF increase provides a boost, but wRVU efficiency and PE adjustments may offset gains—potentially leading to modest net increase or flat reimbursement, for emergency physicians.
| Specialty | CF Change (APM / Non‑APM) | wRVU Efficiency Adj. | PE RVU Shift | Estimated Net |
| Anesthesia | +1.39% / +.88% | –2.5% | –1% PE | Slight negative |
| Radiology | +3.77% / +3.26% | –2.5% | Redistribution | –2% overall |
| Hospitalist (Inpatient) | +3.77% / +3.26% | –2.5% | Less PE in-facility | -5% to -7% hospital-based services |
| Emergency Medicine | +3.77% / +3.26% | –2.5%* | Less PE in ED | 0.5% to 1% increase (of note, -3% for Critical Care and -5% to -7% Observation) |
*Excluding ED E/M codes but will impact procedures, Critical Care & Observation
Practical Takeaways
- Across the board, conversion factors rise—especially for APM participants.
- However, efficiency RVU cuts and practice expense methodology shifts place downward pressure, disproportionately affecting facility-based and non-time services.
- Emergency medicine, particularly ED-based services in hospitals, will need careful coding and PE strategy to protect revenue, as net gains may be minimal or null.
Quality Payment Program (QPP) Updates
MVPs (MIPS Value Pathways): Six new MVPs have been confirmed including two specific to Radiology and one for Pathology.
Performance Threshold: The performance threshold remains at 75 points through 2028 (payment year 2030).
Quality Category: Introduced in 2025, the 10-point benchmarks will apply to specialties with limited measure options, impacting radiology, anesthesia, and pathology. Anesthesia is seeing the removal of a high use measure, 424 Perioperative Temperature Management.
Cost: CMS finalized changes to the Total Per Capita Cost (TPCC) measure’s attribution rules. In addition, a 2-year feedback-only period for new cost measures will allow clinicians to review and improve without penalty.
Improvement Activities: CMS added 3, modified 7, and removed 8 improvement activities. A new “Advancing Health and Wellness” subcategory has been created, and the “Achieving Health Equity” subcategory was removed.
Promoting Interoperability: Updates are proposed for the SAFER Guide and Security Risk Analysis measures. A new optional/bonus TEFCA measure is proposed under the Public Health and Clinical Data Exchange objective.
Learn More
CMS: Calendar Year (CY) 2026 Medicare Physician Fee Schedule Final Rule (CMS-1832-F)
AHA: CMS issues CY 2026 physician fee schedule final rule
ACEP: ACEP Statement Regarding the CY 2026 Physician Fee Schedule
ACR: CMS Releases 2026 Medicare Physician Fee Schedule Final Rule
