Massive Medicare Payment Changes Could Reinvent How Doctors Get Paid—and Patients Benefit

For the first time, Medicare plans to create a two-tiered payment system for physicians based on their participation in value-based care models. The Centers for Medicare & Medicaid Services (CMS) released its proposed 2026 Medicare Physician Fee Schedule on July 14, introducing significant changes that will affect how healthcare teams are reimbursed.

Under the proposal, physicians participating in qualifying Advanced Alternative Payment Models (APMs) would receive,

•  A 3.83% increase in their conversion factor—the amount Medicare pays per relative value unit—raising it from $32.35 to $33.59. 
• Meanwhile, clinicians not in these models would see a slightly lower 3.62% increase, with their conversion factor rising to $33.42.

Split Payment Model

This split payment approach represents a significant shift in Medicare's reimbursement philosophy. By offering higher payments to clinicians in APMs, CMS aims to accelerate the transition from traditional fee-for-service to value-based care models that reward quality outcomes rather than service volume.

For nurses working alongside physicians in various practice settings, these changes could influence care delivery models and team dynamics. Practices participating in APMs often implement care coordination strategies that expand nursing roles in chronic disease management and preventive care.

The proposal includes several other key elements,

• CMS plans to introduce new quality measures focused on primary care management and a payment model specifically targeting chronic disease management. 

Qualifications

To qualify for the enhanced APM rate, clinicians must receive at least 75% of their Medicare Part B payments or see at least 50% of their Medicare patients through an Advanced APM Entity during the specified performance period, according to analysis from multiple healthcare publications.

The rule also addresses telehealth by making certain pandemic-era flexibilities permanent. This change acknowledges the effectiveness of remote care models that many nursing teams have adopted over the past few years.

Nurse Practitioners

For nurse practitioners with their own billing practices, understanding these payment changes will be essential for practice management. The conversion factor directly affects reimbursement rates for evaluation and management services that many advanced practice nurses provide.

The proposal is now open for public comment before CMS finalizes the rule later this year. Nursing organizations have an opportunity to provide input on how these changes might affect care delivery and interdisciplinary collaboration.

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