CPT 99205 carries a 3.50 work RVU in the 2026 Medicare Physician Fee Schedule, with a national non-facility total RVU of 7.09 and a facility total RVU of 4.80. At the 2026 non-qualifying APM conversion factor of $33.4009, that translates to an estimated national Medicare payment of about $236.81 in the non-facility setting and $160.32 in the facility setting — before any locality-specific Geographic Practice Cost Index (GPCI) adjustment is applied.
CPT 99205 is the highest-level new patient evaluation and management (E/M) code in the office/outpatient family (99202–99205), used for encounters involving high-complexity medical decision making or a 60–74 minute total time reference. This page walks through where each RVU figure comes from, how to convert it into a payment estimate, and how 99205 compares to adjacent E/M codes for both payment modeling and physician compensation purposes.
99205 RVU components (2026 MPFS)
| Component | Value | What it represents |
|---|---|---|
| Work RVU (wRVU) | 3.50 | Physician time, skill, effort, and stress associated with the visit |
| Non-facility Practice Expense (PE) RVU | 3.23 | Overhead when the physician’s own practice bears the cost (staff, supplies, equipment) |
| Facility PE RVU | 0.94 | Reduced overhead RVU used when the visit occurs in a hospital or facility setting where the facility, not the practice, absorbs most overhead |
| Malpractice (MP) RVU | 0.36 | Professional liability insurance cost allocated to this service |
| Total RVU, non-facility | 7.09 | Sum of work + non-facility PE + MP RVU |
| Total RVU, facility | 4.80 | Sum of work + facility PE + MP RVU |
These figures come from the CMS national RVU file for the 2026 Physician Fee Schedule. They are unadjusted national values — before any GPCI multiplier or conversion factor is applied, and before any payer-specific contract terms are layered on top.
Why Work RVU, PE RVU, and MP RVU Are Not Interchangeable
A common source of confusion is treating “RVU” as a single number. In reality, each CPT code carries three separate RVU components, and they behave differently depending on the question being asked.
Work RVU is the component tied to the physician’s own effort. It is the figure most physician compensation plans use when calculating wRVU-based productivity pay, because it isolates the clinical work from the overhead of running a practice.
Practice Expense RVU varies by setting because overhead differs by setting. Non-facility PE RVU (3.23 for 99205) applies when the physician’s own office absorbs costs like rent, staff, and supplies. Facility PE RVU (0.94) applies when the service is furnished in a hospital outpatient department, ambulatory surgical center, or similar facility, where the facility bills separately for its own overhead. This is why the same CPT code produces two different total RVU figures and two different Medicare payment estimates depending on place of service.
Malpractice RVU reflects the relative cost of professional liability coverage for that specific service. For E/M codes it’s typically small compared to work and PE RVU, but it’s still a required input for the total.
Only the sum of all three — total RVU — feeds into a Medicare payment calculation. Work RVU alone is not a payment figure; it’s a productivity and compensation figure.
From RVU to Medicare Payment: The Calculation
Medicare doesn’t pay a flat dollar amount per RVU. Instead, each RVU component is adjusted by a matching Geographic Practice Cost Index (GPCI) value for the physician’s locality, then the adjusted total is multiplied by the annual conversion factor:
Medicare payment = [(Work RVU × Work GPCI) + (PE RVU × PE GPCI) + (MP RVU × MP GPCI)] × Conversion Factor
GPCI exists because labor costs, office rents, and malpractice premiums vary by region. A locality with a work GPCI above 1.00 (for example, many parts of California or the New York metro area) increases the work RVU’s contribution to payment; a locality at or below the national average leaves it closer to the unadjusted figure. By statute, only a quarter of the underlying cost-of-living variation is reflected in the work GPCI, which limits — but doesn’t eliminate — geographic swings.
At national GPCI values (1.000 across all three components), the calculation simplifies to total RVU × conversion factor, which is how the $236.81 and $160.32 estimates above were derived:
Non-facility: 7.09 total RVU × $33.4009 = $236.81
Facility: 4.80 total RVU × $33.4009 = $160.32
For 2026, CMS finalized two separate conversion factors for the first time under current statute: $33.4009 for clinicians who are not Qualifying APM Participants (non-QP), and $33.5675 for Qualifying APM Participants (QP). The QP rate produces a slightly higher payment for the identical CPT code and RVU values — for 99205 non-facility, that’s about $237.99 instead of $236.81. The RVU components of the code don’t change between QP and non-QP; only the multiplier does.
To get an accurate locality-specific estimate rather than the national approximation, run the CPT code through an RVU calculator with the correct place of service, then apply locality GPCI values through a GPCI calculator before finalizing the estimate. Skipping the locality step is the most common reason a manual estimate doesn’t match an actual remittance.
99205 Compared to Adjacent New Patient E/M Codes
99205 sits at the top of the new patient office/outpatient E/M family. Comparing it to 99203 and 99204 shows how work RVU and total RVU scale with complexity, but the comparison is a payment and productivity reference — it does not tell a coder which level applies to a specific encounter.
| CPT | Work RVU | Non-facility Total RVU | 2026 Non-QP Estimate |
|---|---|---|---|
| 99203 | 1.60 | 3.52 | $117.57 |
| 99204 | 2.60 | 5.31 | $177.36 |
| 99205 | 3.50 | 7.09 | $236.81 |
The jump from 99204 to 99205 adds 0.90 work RVU and roughly $59.45 in estimated national non-facility payment. That spread is meaningful for both Medicare revenue modeling and wRVU-based compensation, but the underlying decision — which level actually applies — is governed entirely by the applicable 2021 E/M guideline framework: either medical decision making (MDM) complexity or total time on the date of the encounter, supported by documentation. A higher RVU value is a consequence of correct code selection, not a justification for it.
Work RVU in Physician Compensation vs. Medicare Payment RVU
This is where RVU terminology gets misused most often. There are two distinct systems that both use “RVU,” and they answer different questions.
| Medicare payment RVU | Physician compensation wRVU | |
|---|---|---|
| Which RVU components matter | Work + PE + MP (total RVU) | Typically work RVU only |
| Adjusted by | GPCI (locality) and conversion factor | Contract-defined dollars-per-wRVU rate |
| Who sets the rate | CMS, annually | Employer/practice, negotiated |
| Applies to | Medicare fee-for-service claims | Employed or contracted physician productivity pay |
| Payment source | Medicare Trust Fund via MAC | Practice or health system compensation pool |
When a compensation plan credits a physician 3.50 wRVU for a 99205 visit and pays, say, $45 per wRVU, that $157.50 has no fixed relationship to what Medicare actually pays for that same claim. The employer’s dollars-per-wRVU rate is set independently and can be based on market survey data (MGMA, AMGA, SullivanCotter, etc.), specialty benchmarks, or negotiated contract terms — not on the CMS conversion factor. Two physicians could generate identical wRVU totals from 99205 visits and receive very different compensation depending on their contract, while Medicare’s payment for the underlying claims stays the same nationally (subject to locality GPCI).
Anyone building a compensation model off 99205 volume should also confirm whether the employment agreement freezes wRVU crediting to a specific CMS RVU schedule year, since work RVU values for E/M codes have shifted before (most recently with the 2021 E/M overhaul) and can shift again with future rulemaking. A salary calculator that separates credited wRVU from the compensation rate avoids conflating the two systems. Contract terms that don’t specify a reference RVU year are a common gap covered in the contract red flags guide.
Practical Workflow for Modeling 99205
To move from a code lookup to a usable estimate, treat the process in stages rather than trying to get one number to answer every question:
- Confirm the CPT 99205 RVU components for the applicable schedule year (work, non-facility PE, facility PE, MP) before running any calculation.
- Decide whether the question is a Medicare payment question (needs total RVU, GPCI, conversion factor, and QP/non-QP status) or a compensation question (needs credited work RVU and the contract’s dollars-per-wRVU rate) — the two require different inputs and produce different numbers.
- Run the RVU calculator with the correct place of service (facility vs. non-facility) and locality to get a claim-level estimate rather than relying on the national average.
- When comparing 99205 to 99203 or 99204 for volume or payer-mix planning, hold setting, locality, data year, and QP status constant across all three codes; changing any one of them invalidates the comparison.
- For compensation modeling, confirm whether the plan year’s credited wRVU table matches the CMS schedule year used in the estimate, since a mismatch between contract-year RVU values and current CMS RVU values is a frequent source of compensation disputes.
The CPT 99204 RVU guide covers the adjacent code in the same detail if 99204 vs. 99205 boundary cases are the specific concern, and the contract red flags guide is the more relevant next step once the question shifts from “what does this code pay” to “how does this code affect my compensation.”
A final distinction worth repeating because it drives so many downstream errors: the RVU figures on this page describe the relative resource inputs behind CPT 99205 for a given schedule year. They become an actual Medicare payment only after GPCI and the conversion factor are applied for a specific locality and QP status, and they become compensation only after a specific employment contract’s crediting and rate terms are applied. Neither conversion happens automatically from the RVU number alone, and neither should be assumed to equal the other.