Medicare expands site-neutral payments

The Centers for Medicare & Medicaid Services released a proposed Calendar Year 2027 Hospital Outpatient Prospective Payment System and Ambulatory Surgical Center rule on July 2, 2026, the agency said in its fact sheet. The proposal would expand CMS’s site-neutral payment policies and update outpatient payment rates beginning Jan. 1, 2027 if the rule is finalized. (cms.gov) ### Which outpatient services would be subject to expanded site-neutral payments? The CMS proposed rule names imaging services among the categories for expanded site-neutral rates, according to CMS and legal analyses. The agency said the proposal would apply site-neutral treatment to certain imaging furnished in excepted off-campus provider-based outpatient departments. (federalregister.gov) ### What specific payment changes did CMS propose in the rule? The Federal Register posting for the proposed OPPS rule outlines multiple changes published with the rule, including updates to payment amounts and factors and proposals on 340B drug payment adjustments and site-neutral payments. CMS’s rulemaking document lists proposed payment updates that would take effect for services furnished on or after Jan. 1, 2027. (cms.gov) ### Who has reacted to the proposal and what did they say? The American Hospital Association submitted formal recommendations and raised concerns with CMS about the CY 2027 outpatient proposed rule in late August 2026, according to the AHA. (cms.gov) Major hospital and physician groups have also urged CMS to reconsider portions of the proposal, citing potential payment reductions and operational impacts. Industry trade coverage reported that hospital systems and associations filed critical comments after the proposal. ### How did policy analysts describe the likely market impact? The Bipartisan Policy Center and industry briefings said the rule’s expansion of site-neutral payments could narrow the payment gap between hospital-owned outpatient departments and lower-cost sites, such as independent clinics or ASCs. (federalregister.gov) Analysts writing about the proposal said that narrowing the payment differential would create financial incentives for some services to migrate to lower-cost settings; those descriptions were framed as analysis, not agency assertions. ### What did CMS announce about durable medical equipment and prior authorization? The Department of Health and Human Services posted a Federal Register notice on July 30, 2026, updating the Master List of Durable Medical Equipment, Prosthetics, Orthotics and Supplies potentially subject to conditions of payment, and stated that the Master List updates — and additions to required face-to-face and prior-authorization lists excluding upper limb orthoses — are effective Oct. 28, 2026. (aha.org) CMS’s DME master-list page shows the list and notes the Oct. 28, 2026 implementation for the updated items. ### Which DME items and implementation phases did CMS identify? (bipartisanpolicy.org) The CMS master-list documentation and MAC guidance identified specific HCPCS codes being added to required prior-authorization programs, and vendor advisory notices outlined phased implementation for certain upper-limb orthoses by state. Contractors and regional MACs published implementation timetables showing Oct. 28, 2026 as the start date for nationwide application of many of the new prior-authorization requirements. ### What are the next formal milestones in the rulemaking process? The Federal Register entry shows public comments on the CY 2027 OPPS proposed rule were due Aug. 31, 2026, and CMS’s fact sheet says the proposals would take effect Jan. 1, 2027 if finalized. (federalregister.gov) The DME Master List updates and specified prior-authorization additions are scheduled to be implemented Oct. 28, 2026. Stakeholders and providers cited in comment letters and trade press are awaiting CMS’s final rule and additional contractor-level guidance ahead of those dates. (federalregister.gov) (cgsmedicare.com)