December 2025

     In this issue we feature:

• CMS Finalizes CY 2026 OPPS and ASC Payment Rule
• CY 2026 Medicare Physician Fee Schedule Final Rule 
• CY 2026 MPFS Efficiency Adjustment – Key Points
• 2026 CMS Radiation Oncology Reimbursement Changes – Key Points
• CMS WISeR Model Could Disrupt Urology Care in Six States
• Medicare Part B Premium and Cost-Sharing Increases for 2026
• Government Funding Bill Ends Shutdown and Restores Key Healthcare Provisions
• Restoring Medicare Part D Mail Delivery Flexibility 
• CMS Confirms Retroactive Telehealth Flexibility Restoration

CMS released several major year-end rules and policy updates with significant implications for independent urology practices. The CY 2026 OPPS/ASC Final Rule advances long-standing site-neutral payment reforms, including important changes to drug administration reimbursement in off-campus PBDs.

The CY 2026 MPFS Final Rule delivers one of the most meaningful positive conversion factor updates in a decade (as a result of the 2.5% payment increase in the budget reconciliation bill), but it also underscores ongoing structural inequities in physician payment. Medicare Part B premiums and cost-sharing amounts will rise sharply in 2026, increasing financial pressures on patients and practices alike.

The bipartisan government funding bill ended the historic 43-day federal shutdown, restoring key Medicare policies, including telehealth authorities and the GPCI floor, through January 30, 2026. CMS has confirmed that all telehealth flexibilities apply retroactively back to October 1, 2025. LUGPA continues active engagement on restoring Medicare Part D mailing flexibilities and is launching a grassroots campaign to protect in-office Part B drug administration.

CMS Finalizes CY 2026 OPPS and ASC Payment Rule

CMS released the CY 2026 Hospital Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center (ASC) Final Rule. These changes will significantly affect independent urology groups operating ASCs, hospital outpatient departments (HOPDs), and off-campus provider-based departments (PBDs).

Key Payment Updates

OPPS and ASC Rates

• A 2.6% payment increase for both OPPS and ASC services in CY 2026.
• Continued use of the hospital market basket for ASC rates through 2026, with CMS signaling a potential permanent shift.

Site-Neutral Drug Administration Policy

Beginning January 1, 2026, all hospital-owned off-campus PBDs will be reimbursed at non-facility PFS rates for drug administration services (e.g., chemotherapy, immunotherapy, BCG, ADT injections), resulting in a 40–60% reduction in payment. The policy does not apply to on-campus hospital drug administration or Sole Community Hospitals.  This is a key site-neutrality push by the Trump Administration, but the American Hospital Association has vowed to litigate the regulation.

CMS also expressed interest in expanding site-neutral payment policy to additional service categories.

340B Program Updates

• CMS will conduct a mandatory drug acquisition cost survey among hospitals in early 2026, which will inform OPPS drug reimbursement for CY 2027 and beyond, including 340B drug reimbursement.
• To repay hospitals for the unlawful 2018–2022 cuts to drug reimbursement, CMS finalized a 0.5% OPPS conversion factor reduction for non-drug services and items. For CY 2027.  CMS indicated, however, that future years may see a larger reduction (such as a 2 percent reduction).

Major Procedural & Site-of-Service Changes

Inpatient Only (IPO) List Phase-Out

• Inpatient-Only (IPO) list will be fully eliminated by January 1, 2029. Beginning in 2026, CMS will resume removing procedures from the IPO list annually, starting a stepwise phase-out that will continue through 2029.
• For CY 2026, CMS is removing 285 procedures from the IPO list and continuing its policy to exempt procedures removed from the IPO list from Two-Midnight reviews.

ASC Covered Procedures List (CPL) Expansion

• CMS removed long-standing restrictions, allowing for a total of 560 procedures to be added to the ASC CPL for 2026. These new ASC procedures include 271 procedures that were newly removed from the IPO List.
• While no urology-specific procedures were added to the ASC CPL, several general and adjacent codes support ongoing migration to lower-cost sites of service.

Radiation Oncology

No external beam radiation therapy (XRT) codes were added to the ASC CPL for 2026.

Additional Policies

• CMS continues to review payment policies for Software as a Service (SaaS) codes and risk-bearing models.

Hospital price transparency rules tighten in 2026 with new median and percentile rate reporting and mandatory use of the ERA 835 standard.

CY 2026 Medicare Physician Fee Schedule Final Rule

CMS finalized a 3.26–3.77% increase to the MPFS conversion factor—the strongest positive update in more than a decade. This improvement reflects sustained advocacy from LUGPA and partner organizations and provides short-term relief in a system still constrained by budget neutrality and outdated payment formulas.

Practice Impact

Independent office-based procedures

• Expected to see modest but meaningful revenue gains, particularly in services driven by practice expense (PE).
• The updated PE methodology incorporates more accurate supply and equipment pricing, better reflecting the real-world costs of delivering urologic care, including cystoscopy, ultrasound, and in-office diagnostics.
• While gains will vary by code mix, urology is positioned to benefit more than many specialties due to the heavy use of PE-driven services.

Facility-based procedures

• Many will experience downward adjustments, as CMS rebalances work RVUs and reallocates PE resources away from facility-based procedures and toward office-based services.
• These reductions will likely exacerbate existing site-of-service disparities, reinforcing the need for comprehensive MPFS reform and expanded site-neutral policies across Medicare programs.

LUGPA advocated that ASC-based procedures be treated as office-based procedures rather than hospital-based procedures when valuing PE RVUs, since ASC-based procedures are typically provided by independent practices and at a fraction of the cost of hospital-based procedures.

Unfortunately, CMS did not accept that modification to the proposal. LUGPA will continue pressing CMS and Congress to modernize the physician payment system, including structural changes to budget neutrality, annual inflationary updates, and site-neutral reimbursement reforms.

CY 2026 MPFS Efficiency Adjustment – Key Points 

• Effective: January 1, 2026 (CMS CY 2026 MPFS Final Rule)
• Adjustment: –2.5% reduction to work RVUs and intraservice time
• Scope: Applies to ~7,700 non-time-based codes (procedures, diagnostics, imaging, etc.)
• Basis: 5-year rolling average of Medicare Economic Index (MEI) productivity factor
• Exemptions: E/M services, all time-based codes, telehealth, maternity care, therapy services, drug administration, and any codes newly valued in 2026
• Hardest hit specialties: Urology, radiology, cardiology, interventional cardiology, surgical specialties
• Future impact: Policy repeats every 3 years; next adjustment could exceed –3.6%
• Partial relief: Generates +0.49% budget-neutrality increase to the 2026 conversion factor
• LUGPA & specialty society stance: Strongly oppose as arbitrary, based on flawed/low-response RUC surveys, and threatening independent practice viability
• Advocacy: LUGPA and partner groups pushing Congress for statutory delay or repeal before implementation

2026 CMS Radiation Oncology Reimbursement Changes – Key Points

• Effective Jan 1, 2026: IMRT-specific codes (77385, 77386) deleted
• Replaced by new bundled codes: – 77407 (intermediate) – 77412 (complex)
• Payment now based solely on complexity (multiple isocenters, motion management, etc.), without  automatically higher payment for IMRT/VMAT
• Prostate IMRT impact: Most cases will fall to 77407 → 10–20% reimbursement cut unless complexity is added
• Combined with the new “efficiency adjustment,” we expect a significant revenue loss for freestanding centers and accelerated practice closures

CMS WISeR Model Could Disrupt Urology Care in Six States   

CMS has announced the Wasteful and Inappropriate Service Reduction (WISeR) Model, a six-year pilot launching January 1, 2026, that will introduce AI-driven prior authorization for select Medicare FFS procedures in AZ, OH, OK, NJ, TX, and WA.

The model targets services deemed at risk of overuse, including several that directly affect urology—most notably implantable neurostimulators such as sacral nerve stimulation for urinary incontinence (NCD 230.18), as well as incontinence control devices and impotence treatments. CMS will contract with technology vendors who are financially rewarded for “averted costs,” raising serious concerns about increased denials, delayed care, and added administrative burden.

Major surgical and urologic societies—including SUFU, AUA, and ACS—have urged CMS to halt or revise the program due to risks to patient access and opaque vendor incentives. While LUGPA has not released a formal statement, our ongoing advocacy on urologic supplies, prior authorization, and fair reimbursement aligns closely with these concerns.

Practices in affected states should begin preparing now by reviewing NCD/LCD requirements, strengthening documentation, monitoring CMS vendor announcements, and participating in MAC education sessions. LUGPA will continue tracking the WISeR rollout and provide updates as more details become available.

A full comment on the pilot is available here.

Medicare Part B Premium and Cost-Sharing Increases for 2026   

CMS announced that the standard Part B premium will increase to $202.90 in 2026, alongside higher deductibles and coinsurance amounts. This is the biggest increase of the Part B premium in Medicare’s history. These increases reflect rising utilization, drug spending, and programmatic costs.

Implications for Practices for those Medicare patients who lack secondary coverage (13 percent of the Medicare population)

• Higher out-of-pocket costs may contribute to delayed diagnostics, medication non-adherence, and care avoidance—issues of particular concern for cancer patients and individuals with chronic urologic disease.
• Practices may face greater variability in collections, increased bad debt risk, and added administrative work as front-desk and billing teams support patients navigating new financial challenges.
• These trends highlight the continued need for stable Medicare payment policy and patient affordability reforms.

LUGPA continues educating policymakers on how rising beneficiary cost-sharing affects access, clinical outcomes, and the financial stability of independent specialty practices.

Government Funding Bill Ends Shutdown and Restores Key Healthcare Provisions

Congress passed, and President Trump signed, the bipartisan funding bill that ended the 43-day federal shutdown, restoring key healthcare provisions through January 30, 2026, and preventing major Medicare disruptions.

Key Restored Policies

• Medicare telehealth flexibilities reinstated, including home-based visits, geographic and originating-site waivers, and audio-only behavioral health services.
• 1.0 Work GPCI floor restored nationwide, preventing large payment reductions in rural and underserved regions.
• PAMA laboratory cuts delayed, protecting clinical labs and maintaining access to essential diagnostic testing.
• Quality measure endorsement funding restored, enabling continued development and maintenance of Medicare quality programs.
• PAYGO sequestration blocked, averting a 4% across-the-board Medicare cut.

CMS has announced that telehealth claims will be processed retroactively back to October 1, 2025, treating the shutdown period as if no lapse occurred.

Practice Impact

Independent practices faced delayed payments, interruptions to virtual care monitoring and postoperative follow-up, and substantial operational uncertainty. These disruptions reinforce LUGPA’s ongoing advocacy for long-term, stable telehealth authority and predictable Medicare policymaking.

Restoring Medicare Part D Mail Delivery Flexibility

LUGPA continues to support bipartisan legislative efforts to restore COVID-era flexibilities that allowed practices to mail Medicare Part D medications directly to beneficiaries under in-office dispensing authority. This capability is particularly important for rural patients, seniors with mobility limitations, and cancer patients requiring timely and uninterrupted therapy. We are advocating for bipartisan legislation and currently undertaking a grassroots campaign to secure additional signatories to a letter championed by Reps. Harshbarger (R-TN) and Wasserman-Shultz (D-FL) to encourage CMS to use its regulatory authority to restore the flexibility provided during the PHE.

Restoring this option would reduce treatment delays, improve adherence, and enhance care coordination—especially for practices providing complex urologic therapies.

Grassroots Advocacy: Protecting In-Office Dispensing (IOD)

LUGPA is launching a new grassroots campaign urging Members of Congress to sign the bipartisan Harshbarger–Wasserman Schultz letter in support of in-office dispensing (IOD). IOD remains a cornerstone of integrated, patient-centered urologic care.

What Members Should Do

• Contact your Congressional Representatives and urge them to sign the letter.
• Share real-world examples of how IOD improves timely access to therapy and reduces treatment fragmentation.
• Coordinate with LUGPA staff to ensure consistent messaging and follow-up.

IOD continues to be a top LUGPA policy priority, essential to continuity of care, adherence, and equitable access to cancer treatment.

CMS Confirms Retroactive Telehealth Flexibility Restoration

CMS has confirmed that Medicare telehealth flexibilities will apply retroactively to October 1, 2025, despite the temporary lapse caused by the federal shutdown.

Key Points

• Claims will be paid at pre-shutdown rates with no penalties or modifier requirements.
• Geographic and originating site restrictions remain waived.
• Audio-only telehealth continues for eligible services.
• No additional in-person visits are required due to the lapse.

Implications for Urology Practices

• Practices do not need to resubmit claims, avoiding administrative burden.
• Care continuity for postoperative visits, PSA monitoring, chronic condition management, and behavioral health support remains intact.
• Retroactive coverage ensures stable billing and mitigates the financial uncertainty caused by the shutdown.

LUGPA applauds CMS’s swift action and continues advocating for permanent, comprehensive telehealth reform that supports modern specialty care.