The 2026 fee schedule, read from the practice side

Every November the Medicare Physician Fee Schedule final rule arrives, and every November practice owners ask the same question: are we getting paid more or less next year? For 2026 the honest answer is "a little more, for now, depending on what you bill."

Two conversion factors

For the first time, Medicare has two conversion factors. Clinicians who are qualifying participants in advanced alternative payment models get $33.5675. Everyone else gets $33.4009. Those are increases of 3.77% and 3.26% over 2025.

Part of that increase is a one-year 2.5% payment bump written into the One Big Beautiful Bill Act. Unless Congress extends it, that part goes away in 2027, and practices should budget as if it will.

The efficiency adjustment

CMS also finalized a 2.5% efficiency adjustment that lowers the work value of most services that are not time-based. Time-based codes, services on the Medicare telehealth list and maternity codes with an MMM global period are excluded. The idea is that procedures get faster as clinicians do more of them. The effect is that a procedure-heavy practice gets less of the conversion factor increase than one that mostly bills time-based visits.

Facility-based practice expense

For services performed in a facility such as a hospital, CMS cut the part of indirect practice expense that is allocated by work RVUs by 50%. Specialties that do most of their work in hospitals are the most exposed.

G2211 reaches home visits

The visit complexity add-on, G2211, can now be billed with home and residence evaluation and management visits, not only office visits. It is also payable when the visit carries modifier 25 because it happened on the same day as an annual wellness visit, a vaccine administration or another Medicare Part B preventive service. It is still not payable when modifier 25 is there because of a same-day procedure.