CMS Proposes 2026 Medicare Pay Hikes and Drug Rebate Rules
Published Date: 7/16/2025
Proposed Rule
Summary
Starting in 2026, Medicare is updating how doctors and clinics get paid to better match real medical work and new laws. This includes new rules for drug price rebates, diabetes prevention, and shared savings programs, affecting doctors, patients, and health centers nationwide. These changes aim to save money, improve care, and roll out over the next year.
Analyzed Economic Effects
5 provisions identified: 2 benefits, 0 costs, 3 mixed.
Physician pay updates starting 2026
Starting in 2026, Medicare will change the Physician Fee Schedule so doctors and clinics are paid differently to better match real medical work and new laws. This will affect how Medicare pays for many outpatient services and could change payments to doctors and clinics nationwide.
Drug inflation rebate program codified
Starting in 2026, Medicare will codify the Medicare Prescription Drug Inflation Rebate Program from the Inflation Reduction Act of 2022 and introduce new rules for drug price rebates under Medicare. This affects how rebates for certain drugs are handled for Medicare beneficiaries.
Updates to Diabetes Prevention Program
Starting in 2026, Medicare will update the Medicare Diabetes Prevention Program expanded model. These updates affect Medicare beneficiaries who are eligible for diabetes prevention services under that program.
Shared Savings and new payment models
Starting in 2026, Medicare will update Medicare Shared Savings Program requirements and establish or codify new payment models such as the Ambulatory Specialty Model and updates to the Quality Payment Program. These changes affect doctors, health centers, and organizations that participate in Medicare payment models.
Safety-net clinics, ambulance, and Part B rules updated
Starting in 2026, Medicare will update policies for Rural Health Clinics and Federally Qualified Health Centers, revise Ambulance Fee Schedule regulations, update drugs and biologicals paid under Part B, and update the Promoting Interoperability Program. These changes affect safety-net providers, ambulance services, and Medicare beneficiaries.
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