On October 31st, the Centers for Medicare & Medicaid Services (CMS) finalized updates to the Medicare Physician Fee Schedule (PFS), effective for services on or after January 1, 2026.

States that base their workers’ comp fee schedules on the CMS Physician Fee Schedule may adopt these new adjustments, which would require affected parties to update their fee schedule data accordingly to ensure accurate reimbursement rates and compliance.

There are a wide range of updates included in the new fee schedule. Key highlights that may apply to workers’ comp include:

• The conversion factor increased 3.26% to $33.40, with a slightly higher rate of $33.57 (up 3.77%) for physicians in certain value-based care programs
• An efficiency adjustment of 2.5% payment reduction for CY 2026 was made to correct long-standing distortions in payment values.
• A new streamlined process for adding services to the Medicare Telehealth List, with a focus on whether services can be delivered via interactive audio-video technology
• Expanded codes for chronic care management and behavioral health integration, with time-based services exempt from the 2.5 % efficiency cut.
• Standardized coding and payment refinements to reduce fraud risk for skin substitutes
• Updated payment methodology and finalized rules for Medicare Drug Inflation Rebates under the Inflation Reduction Act.
• Policy changes to improve access and payment accuracy, including telehealth flexibilities, for rural health clinics and FQHCs:
• Medicare drug inflation rebates: Implementation details finalized to curb cost growth for certain Part B drugs.