The 2026 final rule: RVU adjustments, new codes among key changes

On November 5, 2025, the Centers for Medicare & Medicaid Services (CMS) released the final rule for the Calendar Year 2026 Medicare Physician Fee Schedule (MPFS), which outlines payment policies for the care of Medicare beneficiaries. CMS elected to disagree with many comments and has released a final rule that reflects most of the proposed changes and updates to the MPFS for 2026.

Conversion Factor

For the first time in years, the conversion factor (CF) is set to increase. On a high level, this is a win for the body of medicine. It is something that we have all been hoping for and is long overdue. But in reality, it is a mixed bag, especially for surgical specialists. Despite this increase in CF, the overall update to urology is estimated at 0% due to other factors described in this column.

The CF increase is due to a small statutory adjustment resulting from the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), a 2.5% boost from the 2025 One Big Beautiful Bill Act (OBBBA), and a 0.49% budget neutrality adjustment addressing changes in relative value units (RVUs). New for 2026 is that there will be 2 CFs: one for those who are part of a qualified alternative payment model (APM) and one for non-APM clinicians. APM participants will see a 0.75% update (in addition to the 2.5% and 0.49% as listed above) so that their CF overall will increase by $1.22 (3.77%), to $33.57, whereas non-APM participants will only get a 0.25% update (with the 2.5% and 0.49% above), resulting in an increase of $1.05 (3.26%) to $33.40.

Telehealth

On November 12, 2025, the President signed a Continuing Resolution (CR) to end the 43-day government shutdown. Included in the CR was an extension of the previously existing telehealth rules to include coverage of telehealth services from October 1, 2025 through January 31, 2026. We expect that CMS will direct Medicare Administrative Contractors (MAC) to reprocess claims submitted during the pause in coverage. If a practice provided these services and elected to hold the claims, we are going to recommend submitting these claims once the MACs have reprogrammed their systems. At the time this article was written, CMS had not released instructions for resumption to the MACs with regard to telehealth services provided after October 1, 2025. It is also not known whether not Medicare claim processing will be placed on a 10-day hold, so MACs can adjust claims processing rules to accommodate the changes dictated by the CR. The action does indicate a bi-partisan commitment to telehealth for Medicare patients, which will need to be taken into consideration if we experience a second shutdown if the CR is allowed to expire on January 31, 2026.

CMS did prepare for an extension or expiration of telehealth in the proposed rule. CMS has made permanent remote audio-visual supervision, will continue to cover audio-visual supervision for teaching physicians (a change from the proposed rule), removed frequency limitations for telehealth hospital visits, reduced the complexity and the requirements for adding services to the covered telehealth service list, and will continue to cover telehealth services for audio-visual and audio-only services under the existing evaluation/management (E/M) codes if Congress extends telehealth coverage.

CMS did extend coverage for telehealth services for rural health clinics and federally qualified health clinics for 1 year, in case Congress fails to extend telehealth coverage to all Medicare patients. Remember that Medicare Advantage plans and commercial carriers can continue to allow telehealth services even if Medicare does not; however, we are all aware of the influence Medicare has on the marketplace.

Finally, CMS has valued and marked as active new Current Procedural Terminology (CPT) codes for remote patient monitoring (RPM) for 2026. The new codes will allow reporting of services provided for shorter duration RPM services, which monitor patients between 2 and 15 days out of 30 days and can be billed once per month. We will update you on its application to urology services as we learn more.

RVU adjustments

Reduction in reimbursement due to efficiency adjustment

CMS is reducing by 2.5% work RVUs (and payments) for procedures, radiology services, and diagnostic tests in what they describe as an “efficiency adjustment,” stating that the efficiencies gained over time and experience are not currently accounted for and, therefore, these values need to be adjusted across the board.

This adjustment has been applied to all procedural services, excluding E/M codes and other time-based codes. As part of this argument, the agency flagged ongoing concerns about the data used to determine service values, which primarily comes from the American Medical Association's Relative Value Scale Update Committee (RUC) surveys. CMS has stated that the RUC survey data may not accurately capture the true time, intensity, or resource usage by practitioners, based on RUC survey processes, including subjectivity in responses, low response rates, potential conflicts of interest among survey respondents, and delays in data updates that may not reflect increasing efficiency over time in clinical practice.

CMS is proposing to revise the efficiency adjustment every 3 years. The agency also aims to place more emphasis on empirical evidence for the codes selected in order to minimize the limitations of relying on survey data.

Updates to the practice expense methodology

Payment for a physician service under the MPFS is derived from a formula that includes the RVUs for physician work, practice expenses (PEs; both direct and indirect costs), and malpractice costs. Indirect PEs include rent, electricity, wages for office staff, billing, and scheduling. CMS has assumed that physicians maintain an office-based practice while also providing care in a facility setting and, therefore, incurred indirect costs while performing services in the facility. With fewer physicians owning their practices, CMS believes they may be overpaying for the indirect costs to practitioners when services are performed in a facility/hospital setting. CMS is therefore reducing the facility PE RVUs allocated based on work RVUs to half the amount allocated to nonfacility PE RVUs. This means that the indirect PE paid to providers will decrease in the facility setting and increase in the nonfacility setting.

The impact of this reduction is projected to result in a cumulative 10% reduction in payments to urologists for services provided in a facility (eg, ambulatory surgical center [ASC], hospital outpatient department [HOPD], or inpatient hospital place of service).

New and revised CPT codes

Several new CPT Category I codes will be available starting January 1, 2026, and values have been assigned. Among those are 9 new codes for prostate biopsy services (such as including MRI-fusion guidance), Aquablation, NanoKnife, and laparoscopic prostatectomy with lymph nodes dissection.

RVU impact

As noted above, the overall impact in urology of the changes in values and the CF is projected to be 0% in overall payments to the specialty. Medicare did provide a slightly more detailed projection of a +5% impact for non-facility (office-based) services and a –10% impact for facility-based services (HOPD, ASC, and inpatient services). Although the overall impact on urologists is minimal, it will affect each one differently. You will need to analyze these impacts as you project your budgets and work RVU–based contracts, taking into account these significant and widespread proposed changes.

Conclusion

Urologists and urology groups should be aware of the key provisions outlined in the 2026 MPFS final rule. Although this summary clearly does not cover all of the changes and updates, the overall 0% impact on urology does not help urology practices deal with increasing costs incurred for staff, rent, supplies, and other overhead. At the time this article was submitted, the Outpatient Prospective Payment System final rule had not been released; we will attempt to summarize its impact in a future article.

Send coding and reimbursement questions to Jonathan Rubenstein, MD, and Mark Painter c/o Urology Times®, at UTeditors@mjhlifesciences.com.

The information in this column is designed to be authoritative, and every effort has been made to ensure its accuracy at the time it was written. However, readers are encouraged to check with their individual carrier or private payers for updates and to confirm that this information conforms to their specific rules.