On Friday, October 31, the Centers for Medicare & Medicaid Services (CMS) released the CY 2026 Medicare Physician Fee Schedule final rule and fact sheet. The following is a high-level summary of the policies that will affect AUA members. AUA staff will review the final rule in detail and provide a complete a summary of the final rule.

Conversion Factor

2026 marks the first year that there are two separate conversion factors: one for practitioners working in a qualifying advanced APM and the other for those not in a qualifying APM. The conversion factor for the former will increase to $33.57, an increase of 3.77%, and the latter to $33.40, an increase of 3.62%. These increases reflect the 2.5% increase to the conversion factor included in the reconciliation package adopted by Congress in July, and a 0.49% positive update to account for the redistributive effects of the finalized changes to work relative value units (RVUs).

Impact to the Specialty of Urology

CMS estimates implemented policies in the rule will have a net impact of 0% in total Medicare charges for urology. However, CMS finalized changes to the methodology for the allocation of indirect practice expenses (PE) within the physician payment formula which will decrease overall charges for urology in the facility setting by -10% but increase payments by +5% in the non-facility (office) setting. According to the agency, this final policy reflects the current state of clinical practice with fewer physicians working in private practice settings, and therefore, “the allocation of indirect costs for PE RVUs in the facility setting at the same rate as the non-facility setting may no longer reflect contemporary clinical practice.” This policy change represents a move towards site neutrality by the agency as they believe that facility-based settings were being reimbursed too much for those indirect costs through the outpatient facility fee and the indirect costs included in MPFS services.

Note that impact of final policies on group practices and individual physicians will vary based on practice type, payer type, mix of patients and the types of services provided to those patients.

CMS Finalizes Most RUC Recommendations for Urology Services

The AUA continues to serve our members by participating in the AMA RUC process and advocating for RVUs that reflect the work of urologists. By participating in the RUC survey process, the Society advocates for work and practice expense values for new and revised CPT codes. CMS finalized all the AMA RUC recommended values for the services surveyed by the AUA except for two codes (55869-Laparoscopic Prostatectomy and 52649-Transurethral Robotic-assisted Resection of Prostate). The AUA surveyed laparoscopic prostatectomy, transurethral robotic-assisted resection of the prostate, prostate biopsy services, cystourethroscopy, and temporary female intraurethral valve-pump services.

New CPT codes and RVUs established for prostate biopsy services were finalized, but the AUA is revising the code set and hopes the revisions will be ready for implementation in 2027. Importantly, new codes including the new prostate biopsy codes which are effective January 1, are not subject to the finalized -2.5% efficiency adjustment policy.

Appendix A lists new and resurveyed codes with RUC recommended values and CMS final values for services performed by urologists.

Efficiency Adjustment Finalized to Address Perceived Overvalued Services

CMS was not moved by comments that called for the agency to abandon the proposed efficiency adjustment policy. As such, work RVUs and corresponding intraservice times will be cut by -2.5% for nearly every service on the fee schedule except time-based codes, including evaluation and management services, care management services, behavioral health services, services on the Medicare telehealth list, and maternity codes with a global period of MMM. Due to comments from stakeholders, including the AUA, newly created codes will not be subject to the efficiency adjustment in 2026.

Per CMS, the efficiency adjustment is meant to account for efficiency gains over time as practitioners become more skilled at performing procedures, and hence are performing those procedures faster than the intraservice times listed in the RUC time files. The agency continues to believe that RUC survey process is flawed due to low response rates and perceived conflicts of interest of those who take RUC surveys and reiterated this stance in the final rule. Additionally, throughout the discussion on response to comments, CMS repeats that the agency welcomes empiric data to support the value of physician services, which is yet another indication that CMS does not want to rely solely on RUC survey data to set payment rates. CMS states “we believe that robust empiric data is important to avoid some of the shortcomings of survey data in accounting for efficiencies over time.”

No Changes to the Valuation of the Global Surgical Package

A recent OIG report on the global surgical package coupled with the administration’s efforts to reduce fraud, waste, and abuse, put the global surgical payment concept once again back in the spotlight. With this rule, CMS reiterated its stance that not all post-operative visits included in the valuation of a surgical procedure are provided to patients during the global period, and therefore many surgical procedures are overvalued.

Given that the agency did not propose any changes to payment for surgeries valued as global surgery package procedures, the policy implemented last year to assist with data collection on the global surgical package remains as is and the agency will continue to collect data using modifier -54 (surgical care only) and G0559 (postoperative care services furnished by a practitioner other than the one who performed the surgical procedure (or another practitioner in the same group practice).

Telehealth Updates

The agency finalized a simplified review process for adding services to the Medicare Telehealth Services List, and to remove the distinction between provisional and permanent services. CMS also finalized to permanently adopt a definition of direct supervision for certain services that allows the physician or supervising practitioner to provide supervision through real-time audio and visual interactive telecommunications. Finally, in a reversal of proposed policy due to submitted comments, CMS will continue to allow teaching physicians to have a virtual presence for services provided by residents in teaching settings.

Appendix A: RUC Recommended and CMS Final Work RVUs

Green highlighted codes are new CPT codes, effective January 1, 2026.