2026 Medicare Physician Fee Schedule and its Potential Reimbursement Impact

Dec 10th, 2025

On November 5, 2025, CMS officially released the 2026 Medicare Physician Fee Schedule Final Rule (click here to review the press release).There are three significant changes that will affect reimbursement rates:

• Conversion factor changes
• Relative Value Unit (RVU) efficiency adjustment
• Practice Expense changes

Rest assured that Find-A-Code.com is updating all of our products containing fee information so that our customers will be able to see the different reimbursement rates based on these revisions for 2026.

Conversion Factor Changes

One of the changes that has been a hot topic is that there will now be two separate conversion factors: one for providers who are qualifying alternative payment model (APM) participants (CMS designates these as qualifying participants or QPs) and one for providers who are not QPs.

RVU Efficiency Adjustment

CMS uses RVU information from the AMA Relative Value Scale Update Committee (AMA RUC) as part of their process for RVU valuation. They stated:

“Research has demonstrated that the time assumptions built into the valuation of many PFS services are, as a result, very likely overinflated. In order to mitigate these effects and take into account changes in medical practice, we are finalizing application of an efficiency adjustment to the work RVUs and corresponding intraservice portion of physician time for non-time-based services that we expect to accrue gains in efficiency over time. This would periodically apply to all codes except time-based codes, such as evaluation and management (E/M) services, care management services, behavioral health services, services on the Medicare telehealth list, and maternity codes with a global period of MMM."

CMS is applying a negative 2.5% “efficiency adjustment” to the work RVUs and intraservice time for many non-time-based services, because they assume many services have become more efficient over time. It might be worthwhile to review RVUs but keep in mind that RVU pricing is reflected in the calculated fees shown in Find-A-Code.

Practice Expense Changes

Changes to CMS’ methodology for creating the “practice expense (PE)” relative value units (RVUs) also impacts pricing. They said:

“[W]e are finalizing to recognize greater indirect costs for practitioners in office-based settings compared to facility settings. The original allocation methodologies assumed physicians maintained separate practice locations even if they furnished some care in hospitals. Since the methodologies were established decades ago, there has been a steady decline in the number of physicians working in private practice, with a corresponding rise in physician employment by hospitals and health systems. Therefore, we believe that the allocation of indirect costs for PE RVUs in the facility setting at the same rate as the non-facility setting may no longer reflect contemporary clinical practice.”

Again, changes to the PE RVUs affect the total RVU for a service; therefore, the fee amount changes.