Decoding the 2026 Medicare Physician Fee Schedule Final Rule

FROM THE CHAIR OF THE COMMISSION ON ECONOMICS
Gregory N. Nicola, MD, FACR

Lauren P. Nicola, MD, FACR, Chair of the ACR Commission on Ultrasound; Guest columnist

On Oct. 31, CMS released the final version of the FY 2026 Medicare Physician Fee Schedule (MPFS) rule. For radiology practices, this rule bears meaningful economic signals — some beneficial, others cautionary. While the headline conversion factor (CF) increases offer a modest uplift, new efficiency adjustments and site-of-service payment shifts raise longer-term concerns about practice margins and access to care.

CF Increases: Some Good News, but It’s Complicated

The bottom-line CF that converts relative value units (RVUs) into dollar payments will increase in 2026: For non-Alternative Payment Model (APM) participants, CMS set the CF at $33.4009 (a 3.26% increase compared with 2025); for qualifying APM clinicians, the CF is $33.5675 (3.77% increase). These adjustments combine the one-year statutory 2.5% bump from Congress, a modest budget-neutrality add-on (approximately 0.49%) and the larger policy shifts below. These increases offer a short-term relief to imaging practices still reeling from prior-year cuts. However, one caveat looms large.

Efficiency Adjustment: A New Headwind for Imaging

CMS finalized a negative 2.5% “efficiency adjustment” for most non-time-based services. Essentially, the agency is shaving down the work RVUs (and thus payment) on the premise that physician productivity has improved due to workflow improvements and technology adoption. Unfortunately, CMS finalized the efficiency adjustment despite stakeholder concerns about its broad application to all non-time-based procedures, concern for reduced patient access to care and threat to the financial stability of practices. Diagnostic imaging and many procedural radiology services fall squarely into the non-time-based bucket, putting them against the adjustment. Indeed, preliminary estimates suggest a reimbursement impact of −2% for diagnostic radiology, −1% for nuclear medicine, 2% for interventional radiology and −1% for radiation oncology. The result is that, even with a higher CF, the net reimbursement uptick may be neutral or even negative. In other words: You’ll receive a slightly higher dollar per RVU, but you’ll likely need to generate even more RVUs or capture operational efficiencies to break even in 2026.

New Supervision Flexibility

Beyond reimbursement mechanics, CMS finalized a permanent expansion of the definition of “direct supervision” to include real-time audiovisual virtual presence of the supervising practitioner. Under this policy, “immediate availability” can now be met through interactive audiovisual technology (excluding audio-only) for all services, including the administration of contrast for imaging studies. This change, originally introduced under the COVID-19 public health emergency, is now permanent. For radiology and imaging practices, the implications are significant: The expanded definition provides operational flexibility for supervision of diagnostic tests, which may be especially useful in rural and increasingly short-staffed practice settings.

Quality Payment Program

CMS is also advancing its Quality Payment Program strategy through the Merit-based Incentive Payment System (MIPS) Value Pathways (MVPs) framework, aiming to simplify reporting and tie performance measures more directly to clinical practice. For the 2026 performance year, six new MVPs are being introduced, including one for diagnostic radiology and interventional radiology, which will now be available for voluntary reporting.

In MIPS, radiologists scored a win thanks to tireless ACR advocacy as CMS finalized changes to the total per capita cost measure to refine attribution methodology. Specifically, CMS will now exclude candidate events initiated by advanced practice providers (APPs) when all other non-APP clinicians (e.g., physicians) within the same TIN-NPI group are excluded based on existing specialty exclusion criteria.

Additionally, CMS is maintaining the scoring policy that revises the benchmark for certain measures in the quality category to allow scoring of 10 points on measures that had previously been capped at seven points. These measures are unchanged from last year and include MIPS measures 143, 360, 364, 405 and 406.

In summary, CY 2026’s MPFS rule delivers modest nominal increases, but the structural shifts, particularly the efficiency adjustment, introduce challenges for radiologists. ACR and other stakeholders continue to press Congress for stability reform, including linking payment updates to inflation and increasing the budget-neutrality cap. ACR will continue to lead that charge, advocating for fairness, stability and innovation. For radiologists, the path forward lies in turning policy influences into momentum: proving that imaging is not a cost to contain but a cornerstone of high-quality patient centered care.