MPFS (Medicare Physician Fee Schedule)
The list of Medicare payment rates for over 7,000 physician and non-physician practitioner services, published annually by CMS in a final rule. Rates are calculated using the RVU framework: total RVUs for each CPT code multiplied by the annual conversion factor and adjusted by the Geographic Practice Cost Index (GPCI) for the practice's location. The MPFS takes effect January 1 of each year and is the direct determinant of Medicare payment for every service a clinic bills.
Why this matters for your clinic
The MPFS governs what Medicare pays for every service you bill. When CMS finalizes the annual MPFS rule, typically in late October or early November, the conversion factor and specific CPT code RVU values are set for the following year. Changes to the conversion factor apply to every Medicare claim you submit. A 2% reduction in the conversion factor is a 2% across-the-board Medicare revenue reduction, regardless of your volume or quality performance.
The MPFS is also the reference point for commercial payer contract rates. Many payer contracts are expressed as a percentage of the Medicare Physician Fee Schedule (for example, 120% of MPFS for office visits). When the MPFS changes, your contracted commercial rates may change proportionally, depending on how the contract language is written. This is a contract provision that is worth reviewing annually.
Annual MPFS changes affect individual CPT codes differently. A specialty that relies heavily on codes that received negative RVU adjustments in a given year will see revenue decline even if the conversion factor is flat. Monitoring the proposed and final MPFS rules each year for your highest-volume CPT codes is a standard CFO function in any Medicare-dependent practice.
What good looks like
CMS publishes the proposed MPFS rule each July and finalizes it in late October or November, effective January 1. The MPFS Lookup Tool at cms.gov allows any provider to look up payment rates by CPT code, locality, and facility/non-facility setting. MGMA and the AMA both publish annual summaries of MPFS changes at specialty-specific level.
Example
CMS finalized the 2025 MPFS with a conversion factor of $32.35 (CY 2025 final rule). For CY 2026, the CMS final rule set dual conversion factors of $33.4009 (non-qualifying APM) and $33.5675 (qualifying APM) — the dual-CF structure was established by MACRA (2015); OBBBA (Public Law 119-21) added a one-year 2.5% update for CY 2026. CPT 99213 (established outpatient visit, level 3) has a non-facility total RVU of approximately 2.85 (work RVU 1.30, practice expense RVU 1.46, malpractice RVU ~0.09 per the CMS CY 2025 final rule). Under the CY 2026 non-QP factor, Medicare payment = 2.85 x $33.4009 = $95.19, subject to GPCI adjustment for location. A practice billing 8,000 99213 visits per year to Medicare collects approximately $762K in Medicare revenue on that code alone. A 2% conversion factor reduction would trim roughly $15K per year off that single code.
From Sorso
We pull the MPFS final rule each November and run every client's top 20 CPT codes against the new rates. It is a 30-minute analysis that tells you exactly what your Medicare revenue budget needs to reflect for the coming year.
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Founder of Sorso and a CFA charterholder. Before Sorso, Stan spent 19 years in corporate finance at institutions including UniCredit and Société Générale — managing a $450M loan portfolio and making senior partner at a major mezzanine lender by 29 — then built a fractional CFO firm exclusively for outpatient healthcare clinics.
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