CMS 2026 HCPCS Level II Update: What the Latest Changes Mean for Billing, Compliance, and Reimbursement

The Centers for Medicare & Medicaid Services (CMS) has officially released the January 2026 HCPCS Level II code files, marking another significant annual update that healthcare providers, billing teams, and revenue cycle leaders cannot afford to overlook. Published on November 24, these updates take effect for dates of service on or after January 1, 2026, and they directly impact how products, supplies, DME, non-physician services, and certain procedures are reported and reimbursed.

While HCPCS Level II updates are expected each year, the 2026 release is notably expansive, with hundreds of code additions, deletions, descriptor revisions, and payment changes. Together, these updates reflect CMS’s continued focus on clinical specificity, drug transparency, telehealth expansion, and value-based care alignment.

2026 HCPCS Level II: By the Numbers

The first-quarter 2026 HCPCS Level II update includes:

• 160 new codes
• 101 deleted codes
• 294 long descriptor revisions
• 1 short descriptor revision (J0759)
• 65 codes with payment changes

These changes reinforce the need for timely system updates, payer mapping validation, and coder education. Claims submitted with outdated codes—or incorrect descriptors—for services rendered on or after January 1, 2026, face a heightened risk of denials, payment delays, or underpayment.

Why the 2026 HCPCS Updates Matter More Than Ever

HCPCS Level II codes are essential for reporting items and services not fully described by CPT® codes, including:

• Injectable and infused drugs
• DME and supplies
• Certain outpatient and hospital services
• Emerging technologies and FDA-approved therapies

For 2026, CMS has doubled down on:

• Granular drug identification, especially for non-therapeutically equivalent products
• Telehealth and remote care tracking
• Clarifying documentation intent through descriptor refinement
• Eliminating obsolete or inactive codes

New HCPCS Level II Codes by Section

A Codes: Supplies and DME Enhancements

CMS introduced three new A codes (A4295–A4297) for intermittent urinary catheters with a hydrophilic coating. These additions reflect advancements in catheter technology and allow for more accurate reporting of enhanced product features that can influence both reimbursement and medical necessity determinations.

C Codes: Hospital Outpatient and Device Innovations

The 2026 update includes 19 new C codes for hospital outpatient services and durable medical equipment. Notably:

• C1607 – Identifies an implantable integrated neurostimulator, signaling CMS’s effort to better track high-cost, high-impact implantable technologies.

These additions improve device-level reporting accuracy and support more precise payment methodologies under OPPS.

G Codes: Care Management, Telehealth, and Prevention

CMS added 14 new G codes, with a strong emphasis on care coordination and digital health:

• G0568–G0570 – Psychiatric Collaborative Care Management
• G0660–G0668 – TEAM remote evaluation and management (E/M) services, aligned with CPT® E/M codes 99201–99205 and 99212–99215
• G9871 – Online diabetes prevention behavioral counseling

These updates reflect CMS’s broader strategy to formalize reimbursement for team-based, virtual, and preventive care models.

J Codes: Expanded Drug Specificity and FDA Alignment

One of the most impactful areas of the 2026 update is the J code section, which includes numerous new codes designed to:

• Separately identify FDA-approved drugs
• Distinguish products not therapeutically equivalent to reference drugs
• Improve pricing accuracy under Average Sales Price (ASP) methodologies

Selected new J codes include:

Billing Reminder:

For drug codes that do not specify a route of administration, providers must append:

• Modifier JA – Intravenous infusion
• Modifier JB – Subcutaneous injection

CMS also continues to strongly encourage use of the ASP HCPCS–NDC crosswalk to ensure accurate product-to-code mapping and correct reimbursement.

M Codes: Other Services and Documentation Requirements

The 2026 update introduces 78 new M codes (M1426–M1503), many of which focus on documentation clarity and reporting of clinical rationale. Examples include:

• M1426 – Encounters conducted via telehealth
• M1427 – Documentation of medical reason(s) for performing a bone scan, including pain related to prostate cancer or salvage therapy

These codes emphasize CMS’s increasing reliance on documented clinical justification as part of payment integrity efforts.

Q Codes: Biosimilars and Tissue-Based Products

CMS added 25 new Q codes, including:

• Q5160 – Bevacizumab-nwgd (biosimilar)
• Q4411 – AmnioMatrixF4X, a human cell, tissue, or cellular/tissue-based product used as a cover and barrier for acute and chronic wounds

These additions support CMS’s ongoing push toward biosimilar adoption and more precise reporting of advanced wound care products.

Discontinued HCPCS Level II Codes for 2026

Many of the 101 deleted codes are J codes for drugs CMS has determined are no longer active or have been discontinued.

Key replacements include:

• S0013 → Replaced by J0013 (Esketamine, nasal spray, 1 mg)
• S0189 → Replaced by J1073 (Testosterone pellet, implant, 75 mg)
• C9305 → Replaced by J9256 (Injection, nipocalimab-aahu, 3 mg)
• C9306 → Replaced by J9326 (Injection, telisotuzumab vedotin-tllv, 1 mg)

Failure to transition to replacement codes can result in automatic claim rejections.

Descriptor and Payment Revisions: Small Changes, Big Impact

Beyond additions and deletions, CMS made extensive revisions to existing code descriptors, many of which materially change how a code should be used.

Examples include:

CMS also updated descriptors for codes such as G2076 and G2077, replacing the term “social determinants of health” with “upstream drivers,” aligning with terminology adopted in the 2026 Medicare Physician Fee Schedule final rule.

Preparing Your Practice for the 2026 HCPCS Transition

To minimize risk and protect revenue, practices should:

• Update billing and practice management systems with the January 2026 HCPCS Alpha-Numeric file
• Review deleted and replacement codes carefully
• Educate coders and clinicians on descriptor changes that affect documentation
• Validate drug billing workflows using the HCPCS–NDC crosswalk
• Monitor payer-specific adoption timelines and edits

Final Thoughts

The 2026 HCPCS Level II update is more than a routine annual refresh—it reflects CMS’s evolving priorities around precision coding, digital care delivery, and payment integrity. For healthcare organizations, success in 2026 will depend on how quickly and accurately these changes are operationalized.

The January 2026 Alpha-Numeric HCPCS file is available for download on CMS.gov, and now is the time to ensure your coding, billing, and compliance workflows are fully aligned for the year ahead.

Turning HCPCS 2026 Changes Into a Revenue Advantage

Keeping pace with HCPCS Level II updates is no longer just a coding task—it’s a revenue protection strategy. With hundreds of new, revised, and discontinued codes in 2026, even small oversights can lead to denials, delayed payments, or compliance exposure. The real challenge isn’t accessing CMS updates—it’s translating them into clean claims, accurate reimbursement, and audit-ready documentation.

This is where experienced medical coding support makes a measurable difference.

Our certified coding specialists stay ahead of CMS guidance, payer edits, and HCPCS–NDC crosswalk updates to ensure every applicable code is applied correctly, supported by documentation, and optimized for payment. By pairing deep regulatory expertise with specialty-specific knowledge and rigorous quality controls, we help practices navigate HCPCS changes with confidence—while protecting revenue and reducing administrative burden.

Click the link to learn more about our medical coding services, and end-to-end revenue cycle management services.