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November 10, 2025

2026 Medicare Physician Fee Schedule final rule

We’ve got your back on Capitol Hill—and we’re in overdrive advocating for you and your patients. Capitol Hill Report is your source for all things neurology advocacy, so keep reading and sharing to stay up to date. Plus, we want to hear from you: Let us know if your practice, research, or patients are affected by recent policy changes.

Issue in focus

The AAN recognizes the extraordinary pressures neurology practices and departments continue to face—from unsustainable reimbursement models to mounting administrative burdens. In every opportunity, the AAN stands up for neurology, advocating for meaningful change that supports our members and their patients.

The Centers for Medicare & Medicaid Services (CMS) recently released the 2026 Medicare Physician Fee Schedule (PFS) final rule, which includes several encouraging updates driven by AAN advocacy. However, significant challenges remain. The AAN remains steadfast in its pursuit of a sustainable payment system and continues to push for congressional action to extend critical telehealth flexibilities and ensure CMS appropriately values the work of neurologists.

The rule goes into effect on January 1. Visit the AAN’s detailed summary of the final rule, or keep reading for a quick guide. 

Based on the policy changes within the PFS final rule, neurology is expected to receive a 1% increase in payments as a specialty. Additionally, Congress passed a 2.5% increase to the conversion factor, and qualifying APM participants will receive a statutorily required 0.75% annual update, while non-qualifying clinicians will receive a 0.25% annual update. The changes result in a projected increase of either 3.77% for qualifying APM participants or 3.26% for non-qualifying clinicians.  

Without an extension from Congress, many of the COVID-19 era telehealth flexibilities expired on October 1, and, during this lapse of coverage, CMS is only able to cover telehealth services if the originating site is in a rural health professional shortage area, counties outside Metropolitan Statistical Areas, or federal telehealth demonstration sites. Further congressional action is needed to extend the telehealth flexibilities that many neurology patients and providers rely upon, and the AAN is committed to working with legislators to ensure these flexibilities are extended as soon as possible.

Within the PFS final rule, CMS has finalized a policy to simplify the review process by removing the “provisional” and “permanent” categories and focusing on whether the service can generally be furnished using an interactive, two-way audio/visual communication technology. In additional significant wins for AAN advocacy, CMS is permanently removing telehealth frequency limitations for the subsequent inpatient visit, subsequent nursing facility visit, and critical care consultation services. Additionally, consistent with our advocacy, CMS finalized policies that extend virtual supervision flexibilities by finalizing a definition of direct supervision that allows for the “immediate availability” of the supervising provider via audiovisual communication technology, and by finalizing flexibilities that allow teaching physicians to have a virtual presence in all teaching settings, only in clinical instances when the service is a 3-way telehealth visit, with the teaching physician, resident, and patient in different locations.  
  
CMS has finalized an adjustment to the G2211 complexity add-on code to allow it to extend its application to home or residence evaluation and management (E/M) visits, in addition to its current usage with office/outpatient evaluation and management services. Additionally, CMS has elected to not move forward with its proposal to delete HCPCS code G0136, Social Determinants of Health Risk Assessment, but will make significant changes to the code descriptor. 

For 2026, CMS has finalized an efficiency adjustment to the work RVU and corresponding intra-service portion of non-time-based services that are expected to accrue gains in efficiency over time. This will periodically apply to all codes except time-based codes, such as E/M services, care management services, behavioral health services, services on the Medicare telehealth list, and certain maternity care codes. The agency has finalized applying a negative efficiency adjustment of 2.5% for Calendar Year (CY) 2026 and will calculate subsequent adjustments every 3 years. CMS is exempting new services from the efficiency adjustment, noting that practitioners would not be able to accrue efficiencies for those services immediately.

CMS has also finalized an update to the practice expense methodology in an effort to more accurately reflect the costs associated with practicing in office-based settings compared to facility settings.  

To ensure fair reimbursement for Part B drugs, CMS has finalized additional guidance to determine whether a bona fide service fee is being passed along to a patient, but the agency did not elect to finalize guidance that would assist manufacturers in determining the fair market value for drugs. CMS has finalized new policies for how it identifies payment amounts when the relevant data for a particular drug and its cost is unavailable. Additionally, CMS has finalized the exclusion of drugs that the manufacturer provides at a discount under the 340B Program.

The agency has decided to finalize the weights for the Merit-based Incentive Payment System (MIPS) performance categories at their current weightings, which are 30% for Quality, 30% for Cost, 15% for Improvement Activities, and 25% for Promoting Interoperability. CMS has finalized setting the performance threshold at 75 points for the CY 2026 performance period and will maintain this threshold through the CY 2028 performance period. Additionally, CMS will expand the portfolio of available MIPS Value Pathways (MVPs) and the format of each MVP to categorize the quality measures by clinical conditions or episodes of care. The agency has finalized six new MVPs to be available in the 2026 performance period related to diagnostic radiology, interventional radiology, neuropsychology, pathology, podiatry, and vascular surgery.

Every year, the AAN hosts a free member webinar on upcoming changes and updates to the Medicare Physician Fee Schedule.  to join us on Wednesday, December 10, 2025, at 12:30 p.m. CT.   

 
Latest advocacy news

Senate passes procedural vote to fund the government
On Sunday, November 9, the Senate passed the first procedural vote on a deal to reopen the government. The deal includes a continuing resolution that keeps the government funded through January 30 as well as a “minibus” appropriations package with the Legislative Branch, Agriculture-FDA, and Military Construction-Veterans Affairs funding bills. The continuing resolution includes language that would reauthorize the lapsed Medicare telehealth flexibilities that expired on October 1. The package still needs final approval in the Senate and a vote in the House in order to reopen the government. The AAN continues to monitor negotiations and will update you as things progress in Washington, DC.

Act now on telehealth flexibilities during the government shutdown 
The AAN understands that the ongoing government shutdown has taken a toll on many of our members and the patients they serve. Uncertainty around government programs, access to care, and the lapse in telehealth flexibilities has created an environment in which some patients don’t know when they will see their neurologists, and some of our members don’t know how they will keep the lights on in their practice. View our government shutdown resources and in Congress on the need to reinstate crucial telehealth flexibilities.

AAN urges Congress to support the work of mobile stroke units 
A recent comment letter from the AAN urges Congress to preserve report language directing a study of financial barriers faced by mobile stroke units. These units are critical infrastructure for rapid stroke care and outcomes improvement.  

Medical students channel their passion, training into strategic advocacy 
A new generation of advocates is strengthening the AAN’s mission to promote the highest quality patient-centered neurological care through policy leadership. Read this highlight on how medical students are channeling their passion and training into strategic advocacy—expanding neurology’s reach, diversifying its future leadership, and ensuring sustained momentum in our collective work to influence health policy.  

Meet US neurology’s tool to have a seat at the table 
BrainPAC is how neurology turns advocacy into influence. Learn how the AAN’s political action committee helps sustain bipartisan relationships, advances priority issues, and ensures neurologists have a lasting seat at the policy table.  

AAN submits comment letters to Medicare Administrative Contractors 
The AAN has submitted five comment letters to five different Medicare Administrative Contractors (MACs) in response to a proposed coverage policy from each on peripheral nerve blocks and procedures for chronic pain. The AAN’s letters advocate for the MACs to rescind the proposed coverage policy, pushing instead for broader policies that ensure coverage for neurological patients who benefit from these procedures.  

AAN joins letter urging Congress to immediately act on telehealth extensions 
On November 4, the Alliance for Connected Care Coalition, of which the AAN is a member, sent a letter to congressional leadership urging Congress to immediately act on a long-term fix to telehealth extensions. This letter follows the sudden lapse in COVID-era telehealth flexibilities due to the ongoing government shutdown, affecting over four million Medicare beneficiaries. Beginning in 2020, these temporary flexibilities have operated on continuous extensions in year-end appropriations. The Alliance urges Congress to promptly reinstate telehealth access for Medicare beneficiaries, ensure retroactive payments for physicians providing telehealth services, and codify current telehealth extensions. 

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