The Centers for Medicare & Medicaid Services (CMS) has released the final rule for the 2026 Physician Fee Schedule, introducing several changes that will affect physician payments and telehealth services.
The conversion factor, which determines how much physicians are paid under Medicare, will increase from $32.34 to $33.40 for those not participating in an advanced alternative payment model (A-APM). For physicians involved in an A-APM, the rate will rise to $33.56. This adjustment includes budget neutrality considerations, an efficiency adjustment, and a one-year 2.5% update passed by Congress to address inflation.
Policy groups have raised concerns about whether these increases are sufficient to maintain access to care for Medicare beneficiaries. The American Medical Association (AMA) commented on this issue: “In their June 2025 Report to Congress, the Medicare Payment Advisory Commission (MedPAC) expressed concerns about the growing gap between physicians’ input costs and Medicare payment, warning: ‘[t]his larger gap could create incentives for clinicians to reduce the number of Medicare beneficiaries they treat, stop participating in Medicare entirely, or vertically consolidate with hospitals, which could increase spending for beneficiaries and the Medicare program.’”
MedPAC has recommended that Congress replace current law updates with annual adjustments tied to the Medicare Economic Index (MEI). The 2025 report from the Medicare Trustees also noted potential long-term issues with patient access if current policies remain unchanged.
The Florida Medical Association stated its ongoing commitment: “At every available opportunity, the FMA will continue advocating for our long-standing goal of increasing Medicare payments for physicians.”
Telehealth policies have also changed as some flexibilities expired due to a prolonged federal government shutdown. However, CMS has lifted frequency limits on telehealth services provided in hospitals and skilled nursing facilities and made virtual direct supervision permanent for most supervised services. Exceptions remain in place for patients with mental health and substance abuse disorders.
Regarding quality reporting through the Merit-based Incentive Payment System (MIPS), CMS did not raise the performance threshold required to avoid penalties in Performance Year 2026. As a result, fewer physicians may face penalties when payments are adjusted in 2028.
Additional information can be found through official resources such as the CMS press release, Physician Payment Schedule Fact Sheet, and Medicare Shared Savings Program Fact Sheet.
