2026 MPFS proposed rule includes telehealth updates, changes to skin substitute payment

Organizations may see certain telehealth flexibilities become permanent, according to the 2026 Medicare Physician Fee Schedule (MPFS) proposed rule, released July 14. The proposed rule also details significant changes to professional reimbursement based on site of service, skin substitute payments, behavioral health services, and more.

For 2026, CMS is proposing two conversion factors: one for physicians participating in alternative payment model (APM) and one for non-APM physicians. CMS is proposing to increase the conversion factor by 0.55% for all rate, with an additional 0.75% for APM participants and 0.25% for non-APM participants.

CMS is also weighing major changes to how it values practice expense (PE) relative value units (RVU). The proposed changes would better recognize the greater indirect costs incurred by physicians in office-based settings as opposed to those in facility settings. The proposed changes could lead to significant differences in reimbursement based on specialty and site of service. Part B News reported that family practice providers could see a 6% payment boost in the non-facility setting in 2026, compared to a 9% reduction in the facility setting, according to Table 92 of the proposed rule. Nurse practitioners may see a 9% fee reduction in the facility setting, compared to a 5% increase in the non-facility setting.

CMS is considering a number of changes to telehealth policies and reimbursement, including the following:

• Permanently remove frequency limitations for subsequent inpatient visits, subsequent nursing facility visits, and critical care consultations
• Permanently adopt a definition of direct supervision that allows the physician or supervising practitioner to provide such supervision through real-time audio and visual interactive telecommunications
• Streamline the process for adding services to the Medicare Telehealth Services List

CMS is proposing to move back to the pre-COVID-19 public health emergency policy regarding teaching physicians and telehealth. Specifically, starting January 1, 2026, CMS would require teaching physicians to be physically present during critical portions of resident-furnished services to qualify for Medicare payment. The agency would continue the rural exception to this policy.

To control growth in spending on skin substitutes, CMS is proposing to pay for these items as incident-to supplies. Currently, skin substitutes are paid for as biologicals under the average sales price (ASP)-based payment methodology, with each product receiving a unique billing code and payment limit. For 2026, the agency is proposing to align skin substitute categorization with the product’s FDA regulatory status. Starting in 2026, CMS would use a single payment rate based on the highest average for the three FDA categories of skin substitute products. CMS may create different payment rates for these three categories in future years. These policy changes would apply to both physician office settings and hospital outpatient departments.

For behavioral health services, CMS is proposing three optional add-on codes for advanced primary care management (APCM) services. The proposed add-on codes would improve practitioners’ ability to offer behavioral health interventions (BHI) by removing the time-based requirements of existing codes for BHI and collaborative care models. The agency is also proposing to expand eligibility for digital mental health treatment codes G0552, G0553 and G0554 to cover use of digital therapy devices for attention deficit hyperactivity disorder.

Revenue integrity professionals should read the proposed rule carefully, paying particular attention to proposals that may affect their organization or job duties. Reach out to colleagues in other departments who may be affected by the proposals, including HIM, coding, CDI, and clinical leaders. Consider working with your colleagues to submit comments on the proposed rule and respond to CMS’ requests for feedback. For tips on how to write and submit a comment, see NAHRI’s white paper Advocacy in Action: Commenting on Proposed Rules.

Members of the NAHRI Advisory Board will discuss the 2026 MPFS and 2026 Outpatient Prospective Payment System proposed rules during the July 22 NAHRI Quarterly Call, to be held from 1 p.m. to 2 p.m. Eastern. Quarterly Calls are an exclusive benefit of NAHRI members and are always free to NAHRI members. NAHRI members may register for the call here. Non-members can gain access to the July call, and all other NAHRI member resources, by joining NAHRI.