Medicare Fee Schedule Update: How Your Bottom Line Is Affected (2026 Edition)
If you have been in the podiatry business for a while, you know that January usually feels like waiting for a storm to hit. We scan the Medicare Physician Fee Schedule (MPFS) with one hand on our calculators and the other over our eyes, bracing for the inevitable pay cuts.
However, 2026 is a unique year. Thanks to a combination of legislative action and advocacy wins from organizations like the APMA, the landscape is shifting. At JARALL Medical Management, we have analyzed the 2026 Final Rule to help you understand what your bank account will actually look like by the end of the second quarter.
Here is the "no-fluff" summary of how your bottom line is affected this year.
The Conversion Factor: Two Paths Diverge
For the first time in recent history, Medicare is using two separate national conversion factors (CFs). Depending on your participation in Advanced Alternative Payment Models (APMs), your "multiplier" has changed:
Qualifying APM Participants (QPs) — Your conversion factor is now $33.57. This reflects a roughly 3.8% increase over 2025
Non-QPs (Most Private Practices) — Your conversion factor is now $33.40. This reflects a roughly 3.3% increase over 2025
The Bottom Line: While a 3% increase sounds like a victory, it is largely a "balancing act." Congress passed the One Big Beautiful Bill Act, which provided a temporary 2.5% boost to prevent massive cuts. Without this legislation, we would be looking at a much bleaker financial year.
Procedure Spotlight: Wins and Losses
While the conversion factor is up, the Work RVUs (Relative Value Units) for specific codes have been adjusted. Here is how your most common procedures are performing in 2026.
1. The Bunionectomy (CPT 28296)
The national average for a bunionectomy with distal metatarsal osteotomy has seen a slight stabilization.
Facility Fee (Hospital/ASC) — ~$1,644
Professional (Doctor) Fee — ~$484
Total Reimbursement — ~$2,128
Verdict: This procedure remains a staple of revenue, but as site-of-service differentials shift, performing these in an office-based setting (where appropriate) may yield higher practice expense (PE) reimbursements than in a facility.
2. Great Toe Arthrodesis (CPT 28750 & 28755)
This is a major advocacy win for 2026. CMS has finalized an increase in Work RVUs for both great toe fusion codes.
The Impact: After years of these codes being undervalued compared to the complexity of the work, podiatrists will finally see a reimbursement rate that aligns with the surgical effort required.
3. Hammertoe Repair (CPT 28285)
Hammertoe repairs remain under the "Efficiency Adjustment" microscope. CMS implemented a -2.5% efficiency adjustment to the work RVUs of nearly all non-time-based services.
The Impact: Because hammertoe repair is considered a "standardized" procedure with high efficiency, you may see a slight downward pressure on the per-procedure payment, even though the conversion factor increased. You will need to see slightly more volume or ensure 100% clean claims to maintain 2025 revenue levels for this code.
4. Skin Substitutes (The $127.28 Rule)
Perhaps the most jarring change in 2026 is the new flat-rate for skin substitutes. CMS has moved away from the ASP (Average Sales Price) model for most products, setting a single national rate of $127.28 per square cm.
The Impact: If you have been using high-cost biologics that relied on a high "markup" or ASP-based reimbursement, your margins just evaporated. You must audit your supply chain immediately to ensure your product costs align with this new $127.28 ceiling.
The "Efficiency Adjustment" Trap
CMS has introduced a new -2.5% "Efficiency Adjustment" to the work RVUs of non-time-based codes (surgery, radiology, and diagnostic tests). They believe that technology has made these procedures "faster," and therefore, they should pay less for the doctor's time.
How to combat this:
Don't ignore E/M — Since Evaluation and Management codes are time-based, they are exempt from this -2.5% cut. Optimizing your office visit coding is now the most effective way to offset the "efficiency" cuts to your surgical procedures
Site of Service Matters — CMS is redistributing payments toward office-based care. If you have the setup to perform minor procedures in-office, you may see a 4% increase in Practice Expense (PE) reimbursement, whereas facility-based services are seeing a 7% drop
2026 Podiatry Reimbursement at a Glance
The headline shifts you should brief your front office and clinical team on right now:
Conversion Factor — Up ~3.3%. Update your EMR fee schedules immediately
Great Toe Fusion — Increased RVUs. Ensure you are using 28750/28755 accurately
Skin Substitutes — Flat rate of $127.28 per sq cm. Renegotiate supply contracts or switch products
Office Procedures — Shifted PE RVUs. Move appropriate minor surgeries to the office setting
Routine Care — High audit risk. Document "at-risk" conditions with 2026 precision
The JARALL Advantage
Keeping up with the Medicare Physician Fee Schedule shouldn't be your second job. At JARALL, we have already updated our systems with the 2026 conversion factors and "scrubbers" to account for the -2.5% efficiency adjustments.
We ensure that even when CMS "rearranges the furniture" of the fee schedule, your revenue stays consistent.
Would you like a customized reimbursement analysis for your top 10 most-used codes? Schedule a complimentary consultation with JARALL today, and let's make sure your 2026 bottom line is protected.