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Final 2026 MPFS brings primary care payment boost and other wins
Nov. 10, 2025, News Staff—CMS has cemented Medicare primary care payment wins next year, which are outlined in the Academy’s summary of the 2026 Medicare physician fee schedule (MPFS) and Quality Payment Program (QPP) final rule.
The rule, published Oct. 31, confirms proposals the AAFP largely supported in detailed comments to CMS, including
- increases to both of the conversion factors (CF) that dictate physician compensation,
- a net estimated increase of 3% in total allowed charges by family physicians and
- an efficiency adjustment that should over time improve the valuation of most services delivered by family physicians.
Higher MPFS conversion factors boost primary care payment in 2026
CMS finalized the 2026 CF, which is the amount Medicare pays per relative value unit, at $33.40, a 3.26% increase over the 2025 CF.
As required by the Medicare Access and CHIP Reauthorization Act (MACRA), the 2026 MPFS introduces a second conversion factor next year, for qualifying alternative payment model (APM) participants. The final rule sets that CF at $33.57, which is 3.77% higher than last year.
Read the Academy’s summary of the 2026 MPFS final rule.
Congress mandated 2.5% of the increases to both CFs in H.R. 1.
“The rule’s higher conversion factors and more appropriate valuation of primary care’s real costs will meaningfully rebalance how Medicare compensates family physicians,” said David Tully, the AAFP’s vice president of Government Relations.
Practice expense update will help most family physicians
The final rule’s change to practice expense information marks another gain for most family physicians as CMS moves toward payment equity.
“CMS is concerned about consolidation and wants to make sure that independent practices can compete with larger, facility-based practices when they are delivering the same services,” said Kate Gilliard, senior manager for federal policy and regulatory affairs in the AAFP’s Government Relations division. “CMS is saying that the cost of doing business is higher for non-facilities, which have more costs per service because they are not operating at the same scale as facilities. To adjust for this, CMS is going to apply a cut to the practice expense portion of the CPT code for all services billed in the facility setting.”
Because many family physicians practice in facilities, Tully said, the AAFP will monitor this change for potential negative effects while urging CMS to avoid penalizing clinicians who work in both settings.
“We’re going to keep calling for exemptions for rural practices,” he said.
Academy welcomes efficiency adjustment, braces for conflict
CMS’ new efficiency adjustment, the agency says, is meant to keep the values of services fair over time.
David Tully and Kate Gilliard talk in depth about the 2026 MPFS final rule in the Fighting for Family Medicine podcast series on Nov. 14.
“The idea is that when the RUC—the Relative Value Scale Update Committee, volunteer physicians who advise CMS on how to value doctors’ work—assigns value to a Current Procedural Terminology (CPT) code, that code is often new and innovative,” Gilliard said. “Delivering these new services ultimately becomes routine as doctors become more efficient. But the RUC historically has taken a decade or more to revalue a service. To help payment keep up with the reality of care delivery, CMS has applied a 2.5% reduction to only the intra-service portion of the work RVU.”
Tell Congress to protect your Medicare payment increase.
The good news for primary care clinicians is that evaluation and management (E/M) codes and time-based codes are exempt from this cut, Gilliard added. “The conversion factor will increase as procedural codes are adjusted downward, while the E/M RVU values will not decrease, meaning better payment for primary care services.”
Because CMS will apply the new efficiency adjustment to numerous codes, leading to small reductions in their values, some specialty organizations representing practices that use those codes have begun lobbying Congress to halt this part of the MPFS.
“We need family physicians to voice support for this policy, which is why we’ve activated a new Speak Out campaign,” Tully said.
Other positive family medicine developments in the 2026 MPFS
- The fee schedule finalizes new advanced primary care management (APCM) add-on codes, aimed at more accurately valuing collaborative care management and behavioral health integration. APCM practices working in those areas can now be reimbursed for providing these additional services.
- CMS also indicated it would consider future policies that would increase adoption of these codes, including waiving patient co-pays. The AAFP will continue to push the agency to remove co-pays from APCM codes.
- CMS will allow the G2211 add-on code to be billed with home/residence E/M services. The Academy had long called for this change, which will let physicians who make house calls use code G2211.
- Responding to the Academy’s telehealth advocacy, CMS reverses the rule as proposed and permanently adopts policy allowing teaching physicians to have a virtual presence for purposes of billing services furnished involving residents in all teaching settings. The AAFP had long pushed for this policy change.
- The rule also makes permanent a definition of direct supervision that allows “immediate availability” of a supervising practitioner to include using audio/video real-time communications technology (excluding audio-only technology) across an expanded set of services.
- The rule finalizes CMS’ proposal to maintain the QPP performance threshold at 75 points through the 2028 performance year, in line with the AAFP’s advocacy.
Academy continues to press for long-term Medicare payment reform
Because the 2.5% payment increase included in H.R. 1 will expire at the end of 2026, Tully added, “the Academy will keep pressing for systemic Medicare physician payment overhaul ahead of the 2027 fee schedule, with continued emphasis on the need for annual inflationary updates.”
Members can find more details about the final rule, which goes into effect Jan. 1., in the executive summary.