On October 31, 2025, CMS finalized the 2026 Medicare Physician Fee Schedule (CMS-1832-F), and the headline was the dual conversion factor increase: $33.57 for qualifying APM participants and $33.40 for everyone else, both up roughly 3 percent. For procedural specialties, the headline was misleading. Beneath the bump sits a -2.5 percent efficiency adjustment to nearly all non-time-based work RVUs and a 50 percent reduction in the indirect practice expense allocation for facility-based services. The net result, in CMS’s own modeling, is roughly a 10 percent total RVU reduction on facility-based procedures including TAVR, percutaneous coronary intervention, ablation, and pacemaker implantation. Procedural practices that bill predominantly out of hospital outpatient departments and ambulatory surgery centers are absorbing that cut starting January 1, 2026.
What CMS-1832-F actually changed
The rule does three things at once. First, it applies a -2.5 percent efficiency adjustment to intra-service times and work RVUs for nearly every non-time-based code in the fee schedule, exempting evaluation and management services, care management, behavioral health, telehealth list codes, and maternity codes. Second, it cuts the share of indirect practice expense allocated to facility-based services based on work RVUs by half. Third, it shifts roughly 5 percent of payment from facility settings into non-facility (office) settings for the same procedures. Specialties that perform most of their work in hospital outpatient departments are hit twice. Specialties that can shift cases into office settings or ambulatory surgery centers under their TIN see partial offset.
Who feels it most
The pain is concentrated in procedural and diagnostic specialties. According to the AMA’s analysis of the rule, 81 percent of infectious disease physicians face cuts of 5 percent or more. Surgical specialties, radiology, and pathology absorb the largest reductions because their codes carry high work RVUs combined with facility-heavy delivery. Cardiology sees significant facility cuts on TAVR, ablation, and PCI, partially offset by office gains on echocardiography. Orthopedics and urology see decreases on facility cases, with smaller increases on office-based procedures. Time-based specialties including primary care, behavioral health, and psychiatry come out net positive thanks to the efficiency adjustment exemption. Knowing where your practice sits on this distribution decides where to focus the response.
The math: how a 10 percent RVU cut cascades
For a single TAVR procedure (CPT 33361), the work RVU reduction layered on top of the practice expense cut translates to roughly $400 to $700 less per case at facility rates. Across an interventional cardiology line doing 200 facility procedures per year, that compounds into a six-figure shortfall before any other variable changes. The same math runs for orthopedic surgery on facility-based total joint replacements, electrophysiology on ablations, vascular surgery on aortic repairs, and radiation oncology on linear accelerator-based treatments. Practices have three levers to pull: tighter coding, better denial recovery, and site-of-service optimization. None of these recover the entire cut. All three together can recover most of it.
First defense: code with full specificity
The single largest source of recoverable revenue in procedural specialties is the gap between what was performed and what was coded. Specialty-trained coders working interventional cardiology, vascular surgery, or orthopedic procedures consistently identify billable elements that generalist billers miss. Common gaps include:
- Failure to capture all 46 of the new lower extremity revascularization codes that replaced 37220-37235 in CPT 2026, where lesion complexity and territory now drive different reimbursement.
- Missed add-on codes for additional vessels, intracardiac echo, intravascular ultrasound, and adjunctive imaging.
- Modifier omissions: -22 for increased procedural services, -59 for distinct procedural services, -78 for return to operating room, -79 for unrelated procedure during postoperative period.
- Underreporting of bilateral procedures, multiple-procedure scenarios, and assistant surgeon roles.
Second defense: tighten denial recovery
Procedural claims carry higher dollar values, which means each denial is more expensive to walk away from. Practices typically recover only 50 to 65 percent of denied procedural claims, often because the appeal window closes before someone takes a second look. The 2026 cut makes that loss harder to absorb. A workflow change that pulls every CARC 50 (medical necessity), CARC 16 (claim lacks information), and CARC 197 (precertification absent or invalid) denial into a 14-day appeal track can recover 15 to 25 percent of the revenue lost to the new RVU adjustments. The denial reasons are predictable. The fix is mostly process discipline, supported by appeal letters that already speak the payer’s language.
Third defense: site-of-service strategy
The rule explicitly raises non-facility (office) payment by roughly 5 percent for many procedures while cutting facility payment for the same procedures. For specialties with credentialing and equipment to perform a service in either setting, that creates a direct incentive to bring eligible cases into the office or an in-network ambulatory surgery center. Cardiology has been doing this for years with peripheral interventions and electrophysiology. Orthopedics is moving knee and shoulder cases into ASCs. Urology is shifting cystoscopy and stone procedures. Each shift requires re-credentialing, equipment investment, and payer-by-payer site-of-service review, but the math now tilts more decisively toward office and ASC settings than at any point in the last decade.
What to action before the next quarter closes
Three steps recover the most revenue in the shortest time. First, run a code-capture audit on the last 90 days of facility-based procedures and quantify the modifier and add-on gaps. Second, pull every denied procedural claim from the same window and re-track them through the appeals process. Third, do a service-line review to identify which procedures could move to office or ASC under existing credentials. The first two steps return cash inside one billing cycle. The third sets up a structurally better revenue position for the rest of 2026.
How MHB helps procedural practices
For practices that want specialty-trained coders working their procedural claims rather than generalists, our team provides medical coding support across 75+ specialties, with cardiology, orthopedics, vascular, urology, and radiology coverage built around CPT 2026 changes and the new facility math. The coders work the practice’s existing systems, with a 24-hour claim submission SLA and a dedicated account lead per practice.
The bottom line
CMS-1832-F is a real cut to procedural revenue, dressed up as a small conversion factor increase. The practices that absorb it best are not the ones that lobby hardest. They are the ones that tighten coding, improve denial recovery, and rebalance site of service. The cut is permanent. The recovery is available now.
