in effect
This is a final rule issued by the Centers for Medicare & Medicaid Services (CMS) that sets Medicare payment rates and policies for hospital outpatient departments and ambulatory surgical centers (ASCs) for calendar year 2026. It also updates quality reporting requirements, the Overall Hospital Quality Star Rating methodology, and hospital price transparency enforcement rules.
Medicare payment rates for outpatient hospital services increase by 2.6 percent for CY 2026, bringing estimated total OPPS payments to approximately $101 billion; ASC payment rates also rise by 2.6 percent, reaching an estimated $9.2 billion. CMS is phasing out the Inpatient Only (IPO) list over three years, beginning by removing 285 mostly musculoskeletal procedures in 2026, and is adding 547 procedures to the ASC covered procedures list. Several quality measures are being dropped from reporting programs, including the COVID-19 Healthcare Personnel vaccination measure and the Hospital Commitment to Health Equity measure. The Star Rating methodology will cap hospitals performing in the lowest quartile of the Safety of Care group at four stars in 2026 and reduce their rating by one full star beginning in 2027. CMS will also conduct a survey of hospital drug acquisition costs, with results intended to inform the CY 2027 rulemaking.
Hospitals with outpatient departments and freestanding ambulatory surgical centers that bill Medicare will see updated payment rates, new covered procedure lists, revised quality reporting obligations, and changes to price transparency enforcement. Medicare beneficiaries receiving outpatient care are indirectly affected through changes to cost-sharing amounts that move alongside the payment rate adjustments. Teaching hospitals seeking to absorb residency training slots from a closing teaching hospital must submit applications by February 19, 2026.