Introduction
The Centers for Medicare & Medicaid Services (CMS) has released the final 2026 Medicare Fee Schedule (PFS) and updates to the Quality Payment Program (QPP). This rule, published in late 2025, outlines Medicare payment policies effective January 2026. It includes changes in physician reimbursement rates, adjustments to the Merit-Based Incentive Payment System (MIPS) and Advanced Alternative Payment Model (APM) tracks, new quality reporting requirements, and other provisions.
Small and independent practices should pay close attention, as many of these changes directly impact their finances and administrative workload. Below we summarize the most relevant highlights – from conversion factor updates to telehealth policy and quality program tweaks – with a focus on real-world implications for solo and small group practices.
Payment Rates and Conversion Factor Changes
One of the headline changes for 2026 is an increase in the Medicare conversion factor, which reverses some of last year’s cuts. By law, CMS will now use two separate conversion factors: one for clinicians who are Qualifying APM Participants (QPs) in advanced alternative payment models, and one for those who are not.
For 2026, CMS set:
- QP Conversion Factor: $33.57, a 3.77% increase from 2025.
- Non-QP Conversion Factor: $33.40, a 3.26% increase from 2025.
These increases include a one-time 2.5% statutory boost enacted by Congress in 2025 to avert deeper cuts. Even with the bump, the 2026 rates are only slightly above 2024 levels, given that 2025 saw a –2.83% conversion factor cut. In other words, the update averts a pay cut but falls short of inflation, a point physician advocates have emphasized. Small practices should plan cautiously – the 2.5% increase is temporary (2026 only), so unless Congress acts again, base rates could flatline or drop in 2027. Both the AMA and MGMA have urged lawmakers to adopt an inflation-linked update to halt the cycle of temporary fixes and chronic underpayment.
Implication
For independent practices, the modest conversion factor uptick offers some relief in 2026 Medicare payments, especially compared to prior years’ cuts. However, the increase (roughly 3.3%) likely won’t fully keep up with rising practice costs—staff salaries, rent, supplies—meaning small clinics must continue budgeting for tight margins. Practices not in APMs will see essentially the same fee schedule increase as those in APMs (only $0.17 less on the dollar), but APM participants gain a slight advantage via the higher conversion factor. Over time, this differential will compound, functioning as a small built-in bonus for participating in Advanced APMs.
New “Efficiency Adjustment” – RVU Cuts for Certain Services
In a controversial move, CMS finalized an “efficiency adjustment” of –2.5% that reduces the Work RVUs (and corresponding intra-service time values) for nearly all non–time-based services. This across-the-board trim is based on the idea that many procedure and service times are overestimated—often relying on dated physician surveys—and that providers become more efficient over time. Importantly, time-based services such as Evaluation & Management (E/M) visits, care management, behavioral health services, and telehealth consultations are exempt from the cut. CMS focused the reduction on procedural and other services not strictly billed by time units.
The 2.5% efficiency adjuster will apply in 2026, and CMS plans to recalculate it every three years, using a five-year look-back at productivity data.
Approximately 95% of physician services are affected, according to the AMA, since over 7,000 codes will receive the cut in 2026. Newly created CPT codes for 2026 are exempt in their first year.
Primary care and other cognitive services are spared (no impact on E/M office visit codes), which aligns with CMS’s intent not to penalize time-intensive care. However, specialties heavy on procedures—cardiology, oncology, surgery, and others—will experience reductions. The AMA warns this policy “would reduce payment for more than 7,000 services” and could particularly affect fields like oncology or OB/GYN, where over one-third of clinicians could face 10–20% cuts when combined with other changes. Physician groups have proposed alternative approaches to update RVUs with better data without using broad, across-the-board cuts, but for now, the efficiency adjustment is moving forward.
Implication
Small specialty practices such as independent surgeons or cardiologists should prepare for slightly lower Medicare payments for procedures in 2026. Primary care and mental health-focused offices are largely protected—E/M visits will not be impacted, and these practices may even benefit as resources shift toward cognitive care.
The American College of Physicians (ACP) praised the concept of aligning RVUs with actual practice efficiency and commended CMS for excluding E/M services, noting that the work involved in E/M visits has only grown more complex and deserves full reimbursement. However, ACP and others urge CMS to be transparent and data-driven with future adjustments and to allow stakeholder input before each recalibration cycle.
Practice Expense & Site-of-Service Differential: Boost for Office-Based Practice
Another structural change in the 2026 rule aims to address the gap between independent office practices and hospital outpatient settings. CMS is revising the Practice Expense (PE) RVU methodology to increase indirect cost values for office-based services and reduce them for hospital or facility-based services. This site-of-service payment differential reflects CMS’s view that, as more physicians are employed by hospitals, the overhead costs for services provided in hospital settings are largely borne by the facility rather than the physician practice.
Key points:
- Facility-based cuts:
For services performed in a facility (hospital or ambulatory surgical center), CMS will cut the portion of indirect PE RVUs tied to physician work by 50% starting in 2026. This translates to about a 10% reduction in total RVUs for many hospital-based procedures, such as pacemaker implants and cardiac catheterizations. - Office-based increases:
The RVU savings from the facility setting are being reallocated to non-facility (office) settings, resulting in an estimated +4% average increase to indirect PE values for office-based services.
CMS believes these changes better reflect true resource costs and address a longstanding bias that favored hospital-owned practices over independent ones.
Commentators have noted that this creates a structural advantage for private practices, helping support the overhead of independent offices—staffing, rent, equipment—while narrowing the gap that often made hospital employment more financially attractive. The ACP applauded this change, stating it “will help support physicians in independent practices, including the next generation of physicians who wish to establish their own practices.” At the same time, ACP cautioned that some subspecialists practicing in both settings may see disproportionate financial impacts and encouraged CMS to consider gradual phase-ins where needed.
Implication
Small practices that operate primarily in their own offices stand to benefit from these PE adjustments. Primary care, specialty clinics, and procedures performed in-office may see higher Medicare reimbursement starting in 2026, improving financial stability.
Independent physicians who deliver services in both office and hospital settings should anticipate lower reimbursement for facility-based work. Practices may want to:
- Increase the number of services performed in-office when clinically appropriate.
- Renegotiate compensation arrangements or facility fees with hospitals.
- Evaluate service mix and scheduling strategies to optimize the new payment differential.
Overall, this policy is widely viewed as a win for independent outpatient practices, helping level the playing field with large hospital systems.
Telehealth and Virtual Care Policies Made Permanent
CMS is extending and solidifying many telehealth flexibilities that were temporarily allowed during the COVID-19 Public Health Emergency. The 2026 final rule locks in several telehealth policy changes that will benefit small practices and their patients.
Telehealth Service Expansion
CMS is streamlining the process to add telehealth services to the approved list. They will no longer label services as “provisional” versus “permanent.” Any service approved for the telehealth list will now be considered permanent unless CMS removes it later.
The agency is simplifying evaluation criteria, focusing primarily on whether a service can be effectively delivered through two-way audio-video technology, rather than requiring complex evidence comparisons. Practically, this means it will be easier for new telehealth services—such as certain group therapies or specialist consults—to be approved and remain on the list. Several codes were newly added for 2026, including group psychotherapy and obesity counseling, which were previously temporary.
No More Frequency Limits
CMS permanently removed previous Medicare limits on how often certain telehealth visits could be delivered. For example:
- The restriction that allowed only one telehealth hospital follow-up every 3 days is gone.
- The limit allowing only one nursing facility telehealth visit every 14 days is also removed.
Physicians can now provide telehealth follow-ups as often as medically necessary in inpatient and nursing facility settings. This flexibility began during the pandemic and is now permanent, improving continuity of care.
Virtual Direct Supervision
CMS finalized that “direct supervision” of clinical staff may be provided via real-time video technology on a permanent basis (with certain exceptions for high-risk procedures).
A supervising physician or practitioner does not need to be in the same room to oversee services such as:
- Incident-to clinic visits
- Diagnostic testing
- Rehabilitation therapy
Instead, they must be “immediately available” via audio-video connection.
For example, a solo physician can remotely supervise a nurse practitioner operating in a satellite office or oversee a stress test administered by staff over a live video feed. High-risk surgical procedures with global periods (such as 0- or 90-day global surgeries) are excluded and continue to require in-person supervision.
Advocacy groups, including the AMA, have praised this change as a long-term win that expands the feasibility of team-based care.
Teaching Physician Rules
CMS reversed its proposal to end virtual supervision for residents in telehealth settings. Teaching physicians will be allowed to supervise residents via virtual presence for telehealth services across all training settings, continuing the flexibility that originated during the pandemic.
Initially, CMS had considered ending this flexibility after 2025. However, widespread feedback emphasized how critical virtual supervision is for residency training and for expanding telehealth access. CMS agreed and retained it without geographic limitations.
Implication
These telehealth policies offer permanent flexibility that is especially beneficial for small and solo practices. Practices can confidently invest in telehealth tools and workflows knowing that many temporary rules are now permanently adopted.
For example, independent practices can:
- Continue offering telehealth follow-ups for nursing home or complex patients without arbitrary caps.
- Use virtual direct supervision to extend physician oversight across multiple sites or during remote work.
- Employ remote clinical staff under compliant supervision structures.
- Provide resident training through telehealth more easily and consistently.
CMS’s approach reflects a pro-telehealth stance intended to improve access, reduce unnecessary in-person requirements, and modernize care delivery.
Small practices should continue monitoring billing requirements such as POS codes and modifiers for telehealth services, but overall, the regulatory environment is now far more stable and supportive of virtual care.
MIPS Updates for 2026: Stable Threshold, New Measures & MVPs
For clinicians in the Merit-Based Incentive Payment System (MIPS), CMS finalized a mix of policy tweaks but kept several key requirements stable to promote continuity. Small practices often struggle with MIPS reporting, so understanding these updates is essential.
Performance Threshold Unchanged
The MIPS performance threshold will remain 75 points for the 2026 performance year (affecting 2028 payments). CMS chose not to raise the bar this cycle, citing the need for program stability. Clinicians must score at least 75 MIPS points to avoid a penalty. The maximum MIPS penalty/bonus remains at ±9%, excluding exceptional performance bonuses, which have expired.
Maintaining the threshold is a relief for many practices — avoiding a “moving target” — and suggests that CMS does not anticipate a substantial increase in median performance scores.
Quality Measures Revamped
CMS will offer 190 quality measures in 2026, with significant turnover in the measure inventory. The updates include:
- 5 new quality measures (including 3 high-priority measures)
- 10 retired measures that were topped-out or low-value
- 30 measures significantly modified (new specs, scoring changes, or updated benchmarks)
CMS continues to align ACO and APP measure sets with MIPS. For example, the APM Performance Pathway (APP) used by ACOs was revised to match updates across the broader MIPS quality library.
Small practices should review the 2026 list early to ensure measures they historically reported are still available and to determine whether the new or revised measures offer better reporting options.
Cost Measures and Reporting
The Cost category includes:
- Two updated Total Cost of Care measures
- A two-year “informational period” for newly introduced cost measures (first 2 years do not affect scoring)
- Updated definitions for episode-based cost measures to reflect modern coding and clinical practice
Cost performance continues to be assessed automatically through claims data, requiring no direct reporting from clinicians. Practices should review their feedback reports to understand how these updates may influence their future scores.
Improvement Activities (IA)
Changes include:
- A new subcategory titled Advancing Health and Wellness
- The removal of the “Achieving Health Equity” subcategory
- Three new Improvement Activities
Small practices (≤15 clinicians) continue to receive double weighting, meaning they only need:
- 2 medium-weighted activities, or
- 1 high-weighted activity
to achieve full credit for the IA category.
The changes in subcategories do not materially alter reporting requirements but may offer new options that align with wellness or preventive care initiatives.
Promoting Interoperability (PI)
CMS finalized:
- Two modified PI measures
- One new optional bonus measure involving Health Information Exchange through TEFCA (Trusted Exchange Framework and Common Agreement)
Many small practices qualify for PI hardship exemptions due to low volume or limited EHR capabilities. Still, practices capable of participating may earn additional points by engaging in TEFCA-based data exchange.
MIPS Value Pathways (MVPs)
CMS continues to develop the MVP framework, which offers more tailored, specialty-relevant reporting.
Key updates for 2026:
- 6 new MVPs added, including:
- Diagnostic Radiology
- Interventional Radiology
- Neuropsychology
- Pathology
- Podiatry
- Vascular Surgery
- All 21 existing MVPs from prior years will be modified.
Small Practice Relief: MVP Grouping
Beginning in 2026:
- A small multispecialty practice can report one MVP at the group level, without forming subgroups.
- During MVP registration, practices will self-attest to their specialty composition.
These policy changes reduce administrative burden and encourage small practices to consider MVP participation.
Voluntary Participation
MVPs remain optional. Practices may continue reporting traditional MIPS if preferred.
What This Means for Small Practices
CMS’s 2026 MIPS updates signal a desire to stabilize the program and reduce disruptions.
Key takeaways:
- The 75-point threshold staying the same gives stability and predictability.
- Practices should perform an early measure audit to ensure continuity if measures they relied on have been retired or modified.
- Small practices continue to enjoy:
- Automatic 6-point quality bonus
- Simplified IA requirements
- Hardship pathways for PI
- MVP participation may now be simpler for small multispecialty groups due to the new flexible subgrouping rule.
- Low-volume threshold protections remain unchanged (≤ $90k Medicare Part B billing OR ≤ 200 Medicare patients).
Small practices that have historically avoided MIPS penalties will likely be able to maintain compliance as long as they keep up with measure updates and reporting deadlines.
Advanced APM Track Updates: QP Incentives and ACO Policies
Clinicians in Advanced APMs (Alternative Payment Models)—such as those participating in qualifying Accountable Care Organizations (ACOs), medical homes, or other risk-bearing models—will see several important changes in 2026 as the QPP enters its ninth year.
End of the 5% Bonus, Start of Conversion Factor Differential
Through the 2022 performance year, QPs received a 5% lump-sum bonus on their Medicare payments as an incentive to participate in APMs. That bonus expired (a smaller 3.5% bonus was provided for 2023/2024 via legislation), and 2026 marks the first year of the new incentive structure established under MACRA.
Instead of a lump-sum payment:
- QPs now receive a higher annual fee schedule update, baked directly into the conversion factor.
- QPs receive a +0.75% base update, compared to +0.25% for clinicians not in Advanced APMs.
- As a result, every Medicare service billed by a QP pays slightly more than the same service billed by a non-QP.
While the incentive is much smaller than the former 5% bonus, it is permanent and cumulative. QPs also remain exempt from MIPS reporting and penalties, which continues to provide significant regulatory relief.
Qualifying Status Determination
CMS is refining its method for determining who qualifies as a QP.
Beginning in 2026:
- CMS will calculate QP status at both the APM Entity level and the individual clinician level.
- If an ACO or APM Entity fails to meet the aggregate threshold, individual clinicians may still qualify if their personal patient or payment mix through the APM meets the required threshold.
This more granular approach increases the likelihood that qualifying clinicians receive the QP designation, especially in larger, diverse ACOs.
The foundational QP thresholds themselves (percentages of patients or payments through an Advanced APM) remain unchanged, as they are set by statute.
Removal of APM Size Limit
Historically, certain Medical Home Model APMs could only qualify as Advanced APMs if the participant practice had 50 or fewer clinicians.
Beginning in 2026:
- CMS is removing the 50-clinician cap, allowing larger practices to participate in Medical Home–type APMs and earn QP credit.
For small practices, this change is largely neutral but expands opportunities for larger or affiliated organizations.
Medicare Shared Savings Program (MSSP) Changes
The rule includes numerous updates to the Shared Savings Program that affect ACOs, with several provisions designed to make ACO participation more attractive—especially for smaller, physician-led groups.
Key updates:
1. Flexibility for Smaller ACOs
ACOs with 5,000 or fewer assigned beneficiaries will be allowed to:
- Remain longer in one-sided (upside-only) risk
- Avoid being forced prematurely into the highest-risk ENHANCED track
This makes the MSSP more accessible to small, physician-led ACOs.
2. Faster Progression for “Inexperienced” ACOs
ACOs with no prior risk-bearing experience will eventually move to higher levels of risk faster than before. CMS is attempting to balance:
- Easing entry for new ACOs
- Ensuring meaningful progression into risk-bearing models over time
3. Quality Scoring Updates
ACO quality requirements can be met by:
- Scoring at or above the 40th percentile of all MIPS performance scores, or
- Qualifying through an alternative sliding-scale method based on outcome measures
Failure to meet quality requirements may affect eligibility for shared savings. CMS is also eliminating health equity bonus points for ACO scoring beginning in 2026.
4. Emphasis on Digital Quality Reporting
CMS reiterated its long-term intent to transition ACOs toward digital quality measures (dQMs) and electronic Clinical Quality Measures (eCQMs). Incentives and phased transitions continue to support this move.
5. New Mandatory Specialty APM Coming in 2027
CMS announced plans for a mandatory Ambulatory Specialty Value-Based Model beginning in 2027, targeting:
- Low Back Pain
- Heart Failure
Participation will be determined geographically. Selected providers will be automatically included and may see payment adjustments based on performance. This signals CMS’s intention to expand value-based care beyond primary care into specialty care.
Implication
For small practices, joining an Advanced APM remains a strategic consideration. While the financial incentives are smaller than in prior years, benefits include:
- A slightly higher conversion factor (ongoing and cumulative)
- Exemption from MIPS reporting and penalties
- Access to shared savings opportunities (via ACOs)
- Policies in 2026 designed to ease entry and participation for smaller, physician-led ACOs
CMS acknowledges that any shifts benefiting primary care and office-based services must be offset by reductions elsewhere, meaning not all providers “win” under budget neutrality. Procedure-heavy specialties operating in hospitals may see substantial cuts, making APM participation more appealing as a stabilizing strategy.
New and Revised Quality Reporting Requirements
Beyond the MIPS measure updates covered earlier, additional quality reporting changes in the rule are noteworthy for both MIPS-participating clinicians and APM entities.
End of Health Equity Adjustment in Quality Scoring
CMS will no longer apply the special health equity bonus points to quality scores for MIPS APM entities (such as ACOs) beginning in 2026.
Previously, ACOs could earn additional points if they served a higher proportion of underserved or low-income beneficiaries. Small practices participating in ACOs—especially those serving safety-net populations—benefited from this adjustment.
With its removal:
- All ACOs will be scored uniformly
- Quality score differences will depend solely on performance, not patient mix
- CMS is signaling that equity will be addressed through other levers (e.g., benchmark methodology, future measure domains)
This change does not directly affect individual or group MIPS reporters but has meaningful implications for ACO participants.
Push Toward Digital Quality Measures (dQMs)
While not an immediate requirement for 2026, CMS continues to emphasize the long-term transition toward:
- Digital Quality Measures (dQMs)
- Electronic Clinical Quality Measures (eCQMs)
- Data exchange through FHIR-based APIs
CMS extended incentives for ACOs that adopt eCQMs and continues refining patient experience data collection methods (such as web-based interfaces).
Small practices should be aware that:
- Future quality reporting will rely increasingly on EHR-generated data
- Manual abstraction and claims-based reporting will gradually decline
- Investment in modern EHR capabilities will become essential for compliance
This transition is part of CMS’s broader goal to modernize quality reporting and reduce redundant documentation.
Administrative Reporting Requirements
CMS periodically introduces new attestations or reporting elements within the QPP. For 2026:
- No major new MIPS clinician-level attestations were added
- Required elements like the annual Security Risk Analysis (SRA) remain unchanged
- ACO REACH entities (if applicable) will have new attestations tied to patient-centered principles
Small practices not participating in ACO REACH or specialized models will see minimal administrative changes.
It remains important to review the QPP Participation Overview annually, as small adjustments to attestation language or reporting interface options occur regularly.
Quality Reporting for Small Practices
Small practices (≤15 clinicians) continue to benefit from several long-standing flexibilities:
- Automatic 6-point bonus in the Quality category (if at least one measure is submitted)
- Double weighting of Improvement Activities
- Broader eligibility for PI hardship exemptions
- Ability to form virtual groups
- Ability to report through MVPs with simplified subgrouping rules beginning in 2026
None of these accommodations were removed or modified in the 2026 rule.
Bottom Line
The overarching quality reporting framework for small practices in 2026 remains very similar to 2025, with:
- Some refreshed quality measures
- A shift in ACO quality scoring mechanics
- Continued movement toward digital reporting
- Stable MIPS scoring categories and thresholds
The biggest long-term implication is the continued modernization of quality reporting—small practices should gradually prepare for a future where automated digital reporting becomes the norm.
Implications for Small and Independent Practices
What do all of these PFS and QPP changes mean on the ground for a small or solo medical practice? Below are the most practical takeaways and recommended action steps for independent practice owners and administrators.
Slight Pay Increase — But Plan for the Future
Medicare fees will rise by roughly 3% in 2026, offering some relief compared to recent years of cuts. This should yield modest increases for common services such as office visits.
However:
- The boost relies on a one-year statutory fix
- Without additional congressional action, conversion factors could stagnate or decline in 2027
- Medicare rates still lag behind inflation, adding pressure to practice margins
Recommendation: Use the relative breathing room of 2026 to stabilize finances, invest in improvements, or build reserves. Stay engaged in advocacy around long-term payment reform.
Expect Winners and Losers in Your Service Mix
CMS’s changes will impact practice revenues differently depending on the services provided.
- Primary care, mental health, and cognitive care gain:
- No impact from the efficiency adjustment
- Potential increases from PE rebalancing
- New care management codes
- Procedure-heavy specialties may lose:
- 2.5% efficiency cuts
- Up to ~10% reductions for hospital-based procedures
- Lower facility-setting reimbursement
Recommendation: Review your CPT code mix. Identify which services will benefit and which may decline. Consider shifting clinically appropriate services to your office setting where reimbursement will be higher.
Leverage Telehealth and Virtual Care
Permanent telehealth flexibilities present durable opportunities for independent practices:
- Maintain or expand virtual visits
- Use virtual direct supervision to extend your reach across multiple locations
- Support work-from-home arrangements or remote staffing
- Strengthen continuity of care for homebound or long-distance patients
Recommendation: Ensure documentation, POS codes, and billing practices align with CMS’s telehealth requirements. Consider investing in workflows or technology to streamline virtual care.
Review Quality Measures & Aim for 75+ Points
With the MIPS performance threshold stable at 75 points, practices should:
- Audit their 2026 quality measure selections early
- Confirm that frequently used measures have not been removed or drastically modified
- Leverage small practice benefits (automatic quality bonus, simplified IA credit, PI hardship options)
A MIPS score under 75 results in a –9% penalty two years later, so maintaining compliance is essential.
Practices exempt under the low-volume threshold should confirm their status annually.
Explore MVPs or APM Participation
CMS continues to incentivize movement toward more integrated, specialty-specific, or value-based reporting and payment models.
- MVPs may reduce reporting burden for some specialties
- APM participation offers regulatory relief (MIPS exemption) and a slight long-term payment advantage through the QP conversion factor differential
- New rules allowing small multispecialty practices to report a single MVP make participation more feasible
Recommendation: Evaluate whether an APM or MVP could simplify administrative burden or provide strategic revenue benefits.
Use New Codes That Pay for Care Coordination
CMS introduced new Advanced Primary Care Management (APCM) codes for 2026, allowing billing for integrated behavioral health services as part of primary care. These codes:
- Simplify requirements
- Remove burdensome time-tracking elements
- Pay for work many primary care teams already perform
Additionally, digital therapeutics coverage has expanded for conditions such as mental health disorders and ADHD, offering new billable opportunities.
Recommendation: Primary care and behavioral health practices should review these codes to identify new revenue sources.
Monitor Policy Changes Beyond 2026
Healthcare policy will continue evolving. CMS and Congress are considering:
- Reforms to budget neutrality
- Further permanent telehealth legislation
- Expanded digital quality reporting
- Increased value-based model participation
- Potential mandatory specialty models (beginning in 2027)
Recommendation: Engage with medical societies and use their policy updates to stay ahead of regulatory shifts. They also provide advocacy on behalf of small practices.
Summary
The 2026 Medicare PFS and QPP rule offers:
- A modest pay increase
- Significant structural advantages for office-based and cognitive care
- New telehealth and virtual supervision flexibilities
- Stable MIPS reporting requirements
- Continued movement toward APMs and digital reporting
Small and independent practices that understand these changes and adjust proactively will be better positioned to maintain financial stability and improve patient care in a challenging reimbursement environment.
Industry Stakeholder Reactions
Physician organizations and industry groups have weighed in on the 2026 final rule, offering perspective on how it will affect practices across the country.
American Medical Association (AMA)
The AMA expressed relief that 2026 avoids an across-the-board pay cut, crediting the one-time 2.5% statutory fix. However, leadership emphasized that this correction “does not keep up with increasing costs,” especially for small private practices.
Key concerns from the AMA include:
- The site-of-service differential may disadvantage physicians who treat patients in hospitals and ASCs
- The efficiency adjustment and facility-based cuts “fail to reflect true resource costs”
- Potential impacts on practice viability, with some specialties facing double-digit reductions due to combined policy changes
At the same time, the AMA praised CMS’s telehealth policies, including:
- Elimination of telehealth visit frequency limits
- Permanent adoption of virtual direct supervision
- Continued support for telehealth across diverse clinical scenarios
However, they underscored that the final rule might contribute to practice consolidation if cuts to procedural and facility-based services undermine independent practice sustainability.
Medical Group Management Association (MGMA)
MGMA delivered a more critical assessment, stating that the combined policies in the rule “will threaten the financial sustainability of medical groups.”
MGMA’s key concerns include:
- The 2026 conversion factor increase is “marginal” and does not compensate for the previous year’s 2.83% cut
- Long-standing issues with Medicare’s “flawed” payment system remain unaddressed
- Arbitrary reductions to work and practice expense RVUs do not reflect real-world costs
- Specialty services may be disproportionately impacted
MGMA argues that these challenges highlight systemic inadequacies and again calls on Congress to implement an annual inflationary update to stabilize physician reimbursement.
Primary Care Organizations (AAFP, ACP)
Primary care groups have been among the most supportive of the 2026 rule.
The American College of Physicians (ACP) stated the changes “will better support the primary and comprehensive health care provided by internal medicine specialists.”
ACP applauded:
- The efficiency adjustment’s protection of E/M services
- Updated practice expense calculations that favor office-based care
- Telehealth expansions
- The recognition of rising cognitive care complexity
However, ACP also acknowledged concerns about budget neutrality requiring offsetting cuts that may disproportionately impact subspecialists.
The American Academy of Family Physicians (AAFP) highlighted:
- The 3.26% conversion factor increase
- Implementation of code G2211 (complexity add-on code)
- Expanded care management and telehealth benefits
Primary-care-oriented analyses described the rule as “a distinct and powerful pivot in reimbursement policy, structurally benefiting independent primary care practices.”
Specialty Societies
Reactions vary significantly across specialties.
Cardiology:
The American College of Cardiology estimated a net +1% increase overall for cardiology, but with:
- A ~7% decrease for hospital-based cardiology services
- A ~5% increase for office-based services
Cardiology groups are deeply focused on understanding the efficiency cut and site-of-service impacts across various procedural codes.
Surgical specialties:
Surgeons expressed concern over significant RVU reductions, including a finalized 27% work RVU decrease for a major cardiac surgery code. Many fear these cuts could undermine independent specialty practices or incentivize further alignment with hospitals.
Internal medicine subspecialties:
ACP noted that while cognitive care benefits, subspecialties performing complex procedures in both office and hospital settings may face “disproportionate impact,” and CMS should monitor downstream effects.
Across specialty groups, there is broad agreement that:
- Mandatory budget neutrality creates arbitrary winners and losers
- Long-term reform is needed to ensure adequate reimbursement and preserve independent practice viability
Common Theme: Congress Must Act
Across stakeholder groups, a consistent message emerged:
Congress must implement long-term Medicare payment reform.
Advocacy groups are urging legislators to:
- Replace budget neutrality requirements
- Introduce automatic inflation-based payment updates
- Stabilize the conversion factor
- Ensure payment structures support independent practices and patient access
Stakeholders warn that without broader reform, ongoing instability could push more physicians into employment by large health systems.
Overall Sentiment
Across the industry, the 2026 PFS and QPP rule is viewed as:
Positive for:
- Primary care
- Office-based services
- Telehealth
- Small ACOs
- Practices shifting toward value-based care
Challenging for:
- Procedure-heavy specialties
- Hospital-based clinicians
- Practices affected by efficiency and PE reductions
- Clinicians facing MIPS penalties without robust reporting processes
Most organizations acknowledge the rule’s significant structural shifts but emphasize the need for further reform to ensure long-term practice stability — especially for independent physicians.
Sources
- CMS Fact Sheet: CY 2026 Physician Fee Schedule Final Rule
- AMA Press Release on 2026 Fee Schedule
- MGMA Statement on 2026 Final Rule
- ACC Analysis of 2026 PFS (Cardiology perspective)
- Holland & Knight Summary of 2026 PFS (MIPS & APM details)
- American College of Physicians Statement
- Elation Health Blog on 2026 PFS (Primary Care impacts)
- AAMC Washington Highlights on 2026 PFS & QPP
