On July 15, 2025, CMS released the Calendar Year 2026 Hospital Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center (ASC) proposed rule. The rule includes a number of significant policies: new price transparency requirements, site neutral payments on drug administration services and new policies impacting the 340B program.  

One of the most notable proposals is a revision to the repayment mechanism for 340B underpayments. CMS proposes increasing the annual reduction to the OPPS conversion factor from 0.5% to 2.0%, beginning in CY 2026. This change is intended to accelerate the $7.8 billion repayment that the Supreme Court had mandated when it invalidated cuts to 340B drugs adopted in 2018. Instead of lowering payments for non-drug services over a 14-year period, the rule proposes to do it within only six years – which means that outpatient payments for non-drug services would be decreasing. This higher reduction rate would apply only to hospitals enrolled in Medicare before January 1, 2018. 

CMS plans to conduct a nationwide survey of hospital acquisition costs for outpatient drugs that could lead to 340B payment reductions. According to the rule, the survey would be launched in early 2026 and CMS would propose changes based on that survey in the CY 2027 OPPS rule (April or May of 2026), which means that any payment changes will likely take place beginning in January 2027.  

The agency also proposes to eliminate the Inpatient-Only (IPO) list gradually, with nearly 300 procedures slated for outpatient eligibility in 2026 alone. The IPO list determines which procedures can only be performed in the inpatient setting. By eliminating the list, many of those services are expected to shift to the outpatient setting – accelerating that ongoing shift and impacting inpatient volume.  

CMS is also expanding its site-neutral payment policy so that drug administration services (APCs 5691-5694) provided in all off-campus hospital outpatient departments are reimbursed at the lower, physician payment rate. CMS is seeking feedback on whether it should expand this policy to on-campus clinic visits and not just off-campus ones. This is a major shift in the conversation, as most of the discussions on site neutral payments focused only on off-campus departments. Some argue that hospitals are acquiring physician practices and converting them to outpatient departments to get increased payments. This is why CMS and policymakers are increasingly considering paying outpatient departments at the same rate as physician practices and/or eliminating facility rates.  

CMS is proposing new hospital price transparency requirements that will involve more granular reporting. Starting Jan. 1, 2026, CMS proposes to require hospitals to include detailed ranges of the rates they negotiate with health insurance plans in machine-readable files. These rates are known as “allowed amounts” and would include the 10th, median and 90th percentile. This data must be calculated using EDI 835 remittance advice transaction files and included in the hospital’s MRF, along with the number of data points used. Hospitals would also be required to encode their organizational National Provider Identifier (NPI) anI didd identify a senior official, such as the CEO or president, responsible for attesting to the accuracy and completeness of the reported information. 

Comments are due to CMS by September 15, 2025. You can view the CMS fact sheet here. If you have feedback you would like AHPA to include in our comments to CMS, please email Rylie Granville at Rylie.Granville@adventhealth.com.