AMA Analysis: 2026 Medicare Physician Payment Schedule and Quality Payment Program Final Rule

The American Medical Association (AMA) released its analysis of the 2026 Medicare Physician Fee Schedule (MPFS) and Quality Payment Program (QPP) final rule, highlighting both positive payment updates and several offsetting policy changes.

For 2026, all physicians will see positive conversion factor updates, including a 3.77% increase for Advanced Alternative Payment Model (APM) qualifying participants and a 3.26% increase for all other physicians. These increases reflect a temporary 2.5% congressional pay bump, Medicare Access and CHIP Reauthorization Act (MACRA) – mandated baseline updates, and a 0.49% budget-neutrality adjustment.

However, the AMA notes that these gains may be partially offset by two major CMS policies:

Efficiency Adjustment: CMS finalized a 2.5% reduction to work Relative Value Units (RVUs) and intra-service time for most services, applied every three years. Only 656 services are exempt.

Practice Expense Methodology Changes: CMS is redistributing indirect practice expense from facility-based to non-facility services. As a result, payment for services furnished in facility settings will decrease by ~7%, while non-facility office-based services increase by ~4%. AMA warns this shift may disproportionately affect specialties practicing primarily in hospitals, ASCs, nursing homes, and inpatient settings.

The AMA also expressed disappointment that CMS did not incorporate new data from the Physician Practice Information (PPI) Survey when updating practice expense inputs, despite broad support from medical specialties and recently collected cost data.

Additional updates include new Merit-Based Incentive Payment System (MIPS) Value Pathways (including Diagnostic Radiology, Interventional Radiology, Pathology, Neuropsychology, Podiatry, and Vascular Surgery), changes to cost attribution under the Total Per Capita Cost measure, modifications to Improvement Activities, and finalized telehealth flexibilities, including permanent virtual direct supervision.

The full AMA analysis provides further detail on impacts across telehealth, code valuations, global surgical packages, Advanced APM policies, and updates to the Medicare Diabetes Prevention Program.

Source: https://www.ama-assn.org/system/files/2026-mpfs-final-rule-summary-analysis.pdf