2026 CMS Proposed Rule: What You Need to Know

It’s that time again: The Centers for Medicare & Medicaid Services (CMS) has released its Proposed Rule for the upcoming calendar and fiscal year. This extensive, nearly 2,000-page document details key changes that, if finalized, will significantly affect Medicare payments, quality programs, and more. For rehab therapy professionals, knowing these details is crucial, as it’ll help them navigate future reimbursement and practice requirements moving forward. 

We know that stepping away from patients requiring your help to review long documents isn’t feasible, so we’ve reviewed and compiled the information you need to get up to speed. Therefore, without further ado, let’s explore exactly what you need to know from the new Proposed Rule to maintain compliance and quality in your practice. 

Conversion Factors: Going From One to Two

Let’s start with a foundational element: the conversion factor. This is the dollar amount CMS uses to calculate payments for physician services under the Medicare Physician Fee Schedule (MPFS).

For the first time, CMS is issuing two separate conversion factors. One is for providers who are “Qualifying Alternative Payment Model (APM) participants,” and the other is for all other providers (non-qualifying APM participants). In simple terms, this means CMS is creating an incentive for providers to move toward value-based care, while still supporting the traditional fee-for-service model.

In addition to this split, there have been statutory changes and proposed adjustments to the conversion factors, which will affect the final payment rates.

Here’s the breakdown of what this looks like for 2026.

Qualifying APM Conversion Factor

• Proposed update: 0.75%
  • This leads to a projected increase (3.85%) of approximately $1.25 from the current factor, bringing the new rate to $33.58

Non-Qualifying APM Conversion Factor

• Proposed update: 0.25%
  • This leads to a projected increase (3.3%) of approximately $1.07 from the current factor, bringing the new rate to $33.42

How Does This Affect Rehab Professionals?

Although a conversion factor increase sounds great, the majority of physical, occupational, and speech therapy providers providing Medicare Part B services aren’t considered Qualifying APM participants. To be considered a Qualifying APM Participant, a clinician must meet a specific threshold based on their involvement with an Advanced APM.

Therapists who are part of small practices, rather than large physician groups or accountable care organizations (ACOs), are less likely to meet the required patient volume or revenue thresholds under current APM structures. Whether or not they see a positive overall impact depends on changes to the Relative Value Scale (RVS).  

Proposed Efficiency Adjustment 

According to the proposed rule, CMS is suggesting a negative 2.5% efficiency adjustment using a look-back period of five years. They want to apply this adjustment specifically to the work of Relative Value Unites (RVUs) of non-time-based Current Procedural Terminology (CPT) codes. 

CMS’s rationale for this is explained on page 145, where they state that, “non-time-based codes, such as codes describing procedures, radiology services, and diagnostic tests, should become more efficient as they become more common, professionals gain more experience, technology is improved, and other operational improvements.” 

What This Means for Rehab Professionals

Fortunately, many of the common CPT codes for physical and occupational therapy (OT) are time-based, like 97110 for therapeutic exercises and 97140 for manual therapy. However, there are a few non-time-based codes, especially in the evaluation and re-evaluation category, that might have reduced reimbursements in the future. Some of these might include: 

• 97161: Physical therapy (PT) evaluation: low complexity
• 97162: OT evaluation: moderate complexity
• 97167: OT evaluation: high complexity
• 97168: OT re-evaluation

There are also modality codes, like 97010 (application of a hot or cold pack) and 97014 (unattended electrical stimulation), that could lead to lower payments. 

Contrarily, speech language pathology (SLP) services have fewer time-based codes and more non-time-based codes, as they often bill once per session. In fact, some of their most common and essential services, including evaluations and core treatment, rely on untimed codes. 

While PTs and OTs can rely on several time codes that won’t be subject to efficiency payment cuts, speech therapy practices are likely to see a direct reduction that’ll have a significant and immediate impact on their practices. 

Remote Therapeutic Monitoring Codes 

On page 230 of the 2026 proposed rule, CMS states that the American Medical Association (AMA) CPT Editorial Panel created four new remote therapeutic monitoring (RTM) codes. Although in reviewing the list, only three new additions appear. These new codes buckle down on two limitations found in the current RTM system, which are: 

• The number of days of data must be collected 
• The amount of time spent on treatment management 

The newer codes are for RTM services that require less than 16 days of data transmission per 30-day period and fewer than 20 minutes of interactive communication per month. Creating a lower threshold makes it possible for practitioners to bill for the effort, time, and cost associated with setting up the device. 

Before, if a patient’s treatment plan only required 11 days of monitoring, it simply wasn’t billable. The same applied if a therapist spent 14 minutes reviewing data or communicating with a patient; the work would be uncompensated. 

The New Proposed RTM Codes

Here are the three new proposed codes found on page 232 of the 2026 CMS proposed rule.

• 98XX4 (RTM Device Supply): Remote therapeutic monitoring (e.g., therapy adherence, therapy response, digital therapeutic intervention) device(s) supply for data access or data transmissions to support monitoring of the respiratory system, 2-15 days in a 30-day period 
• 98XX5 (RTM Device Supply): Remote therapeutic monitoring (e.g., therapy adherence, therapy response, digital therapeutic intervention) device(s) supply for data access or data transmissions to support monitoring of the musculoskeletal system, 2-15 days in a 30-day period
• 98XX7 (RTM Management Services): First 10 minutes of remote therapeutic monitoring treatment management services, physician or other qualified health care professional time in a calendar month requiring at least one real-time interactive communication with the patient or caregiver during the calendar month

If approved, the newly added codes will decrease the amount of valuable, uncompensated work rehab therapists do. By getting rid of the all-or-nothing barrier of the old rules, practices could also boost operational efficiency and expand the pool of patients who qualify for RTM.

Updated CPT Code Descriptions 

CMS also revised the descriptions of three existing codes to clarify the minimum data transmission period required for devices. This potential change would address the ongoing confusion that has existed since the codes’ initial implementation.

• 98976 (RTM Device Supply): Remote therapeutic monitoring (e.g., therapy adherence, therapy response, digital therapeutic intervention) device(s) supply for data access or data transmissions to support monitoring of the respiratory system, 16-30 days in a 30-day period
• 98977 (RTM Device Supply): Remote therapeutic monitoring (e.g., therapy adherence, therapy response, digital therapeutic intervention) device(s) supply for data access or data transmissions to support tracking of the musculoskeletal system, 16-30 days in a 30-day period
• 98978 (RTM Device Supply): Remote therapeutic monitoring (e.g., therapy adherence, therapy response, digital therapeutic intervention) device(s) supply for data access or data transmissions to support monitoring of cognitive behavioral therapy, 16-30 days in a 30-day period

Proposed Telehealth Policy Updates

Telehealth policies have been in limbo for years now, but some things might be getting finalized in this recent Proposed Rule. 

Telehealth Services List 

On page 108, CMS is proposing to streamline the process of adding services to the Medicare Telehealth Services List by eliminating the distinction between ‘provisional’ and ‘permanent’ status. To achieve this, the agency is suggesting that all telehealth services on the list, including those previously considered provisional, will be permanently included in a new ‘maintain’ category.

Moving services to the “maintain” category would provide a level of certainty for rehab professionals. Therapists could feel confident that if they perform a telehealth service that’s on the list, they’ll be reimbursed for it. However, despite CMS potentially offering some level of stability, it’s possible that ​​rehab professionals won’t be on that list after the Section 1135 of the Social Security Act waiver expires, unless Congress acts. 

Additionally, when deciding if a service will be added to the list, CMS will focus on just one question: “Can the service be furnished using an interactive, two-way audio-video telecommunications system?”. Before, adding a service required an excessive amount of clinical efficacy data to determine if it could be successfully provided virtually, but this significantly slowed down the process.  

Telehealth Frequency Limitations

CMS is proposing to permanently remove an existing restriction on how often providers can bill for certain telehealth services, such as subsequent inpatient and nursing facility visits. The old rule limited the number of times a provider could use telehealth for these visits before an in-person visit was required. If this new proposal is finalized, providers will be able to perform these visits via telehealth as often as is medically necessary, without being forced into a face-to-face encounter. 

This move could mean fewer administrative burdens for rehab therapists, along with greater flexibility, especially in facility settings. Rehabilitation professionals can maintain continuity of care and perform follow-ups without traveling between sites. 

More about this can be found on page 121 of the proposed 2026 Medicare Physician Fee Schedule. 

Telehealth and Direct Supervision 

During the COVID-19 Public Health Emergency (PHE), the direct supervision definition was amended to permit a supervising physician or practitioner to be considered “immediately available” through virtual presence using two-way, real-time audio/visual technology. Now, CMS is proposing to make this a permanent definition, but only for certain services. 

If made permanent, the assistants of PTs, OTs, and speech therapists can perform certain services without the supervising provider being physically present. This would benefit rehabilitation practices in several ways.

• Greater flexibility: A licensed therapist could supervise multiple therapy assistants in different settings
• Scalability: Practices could expand their capacity without hiring a full-time provider for every location
• Better quality of care: Practitioners can personally tend to more complex cases
• Flexible scheduling: Rehab facilities may be able to adjust schedules or cover staffing shortages more easily
• Reach more patients: It’ll be easier to serve patients in rural or underserved areas, and care can still be provided to patients with more limited availability via home visits
• Reduced overhead expenses: Optimizing staff time, decreasing travel costs, and potentially decreasing real estate space can lead to more savings

Changes to MIPS and MVPs

The two CMS Quality Payment Program (QPP) initiatives, the Merit-Based Incentive Payment System (MIPS) and the MIPS Value Pathways (MVPs), may be undergoing some subtle changes. But let’s start by discussing what’s likely to stay the same: the performance threshold. It’s set to remain at 75 points for the 2026 performance period/2028 MIPS payment year and the 2028 performance period/2030 MIPS payment year (see page 906).  

MIPS

CMS is proposing a new measure for the PT/OT Specialty Set, which you’ll find on page 1605.

• Measure 317: Preventive Care and Screening, Screening for High Blood Pressure and Follow-Up Documented
  • This will track the percentage of adult patients (age 18 or older) who are screened for high blood pressure during their visit. If the patient’s blood pressure is high, the PT/OT must also document a follow-up plan.

In addition, CMS proposes removing two measures from the PT/OT Specialty Set and the SLP Specialty Set, including: 

• Q487: Screening for Social Drivers of Health (page 1791) 
• Q498: Connection to Community Service Provider (page 1718) 

MVPs

While there are six new MIPS Value Pathways, none of them are specifically for rehabilitation professionals. Nonetheless, there are current MVPs that are relevant to PTs, OTs, and SLPs. For example, PTs and OTs can report on the “Rehabilitative Support for Musculoskeletal Care” MVP already. 

CMS shares on page 929 of the Proposed Rule that they plan to modify all 21 previously finalized MVPs, so some measures and improvements will likely be modified, added, or removed. 

2026 Proposed Rules: How They’ll Affect Rehab Professionals

With the Proposed Rule now released, it’s time for rehabilitation specialists to assess how these changes will impact their practice and what providing services to Medicare patients might look like in the coming year.

Some of these suggested changes bring less administrative burden and greater flexibility, but others could negatively affect your bottom line. The best course of action is to use resources like this to actively prepare for what’s to come.