CMS prioritizes site neutral payments, price transparency in 2026 OPPS proposed rule

Price transparency and site neutral payments are back in the spotlight in the 2026 Outpatient Prospective Payment System (OPPS) proposed rule, released July 15. The proposed rule also sees CMS reviving efforts to eliminate the inpatient-only list. It also includes changes to skin substitute payments, further reductions to offset increased payments for non-drug items and services as a result of the vacated 340B policy, and a slew of other changes affecting reimbursement, reporting programs, compliance, and coverage.

CMS is proposing a 2.4% payment increase. In comparison, the agency proposed a 2.6% increase for 2025 and finalized a 2.9% increase.

Site neutrality

CMS is considering expanding its site neutral payment policy to include drug administration services furnished at excepted off-campus provider-based departments (PBD). Under the proposal, CMS would apply the Medicare Physician Fee Schedule (MPFS) rate to any drug administration Healthcare Common Procedure Coding System (HCPCS) reported at excepted off-campus PBDs. In the proposed rule, CMS cited the policy it finalized in the 2019 OPPS final rule to control what it believes is an unnecessary increase in the volume of outpatient services. CMS is also seeking comments on ways it could control “unnecessary” increases in the volume of clinic visit services at on-campus hospital outpatient departments.

CMS is once again proposing to eliminate the inpatient-only list. According to the proposed rule, the list would be phased out over three years, starting with the removal of 285 mostly musculoskeletal procedures in 2026. The agency finalized a virtually identical policy in the 2021 OPPS final rule, only to completely change course and reverse it in the 2022 OPPS final rule, adding back the procedures that were removed. As in the policy finalized for 2021 and reversed starting in 2022, procedures removed from the inpatient-only list would be exempt from medical review audits related to the 2-midnight policy. The exemption policy would be in effect until CMS determines that the procedure is more commonly performed in the outpatient setting among Medicare beneficiaries.

Price transparency

CMS is proposing a number of modification to its hospital price transparency policies, many highly technical in nature. Starting January 1, 2026, CMS is proposing to require hospitals to disclose the tenth, median and ninetieth percentile allowed amounts in their machine-readable files (MRF) when payer-specific negotiated charges are based on percentages or algorithms. Hospitals would also be required to include the count of allowed amounts used to determine the percentiles. The agency is also proposing to require hospitals to use electronic data interchange (EDI) 835 electronic remittance advice (ERA) transaction data to calculate and encode allowed amounts when a payer-specific negotiated charge is based on a percentage or algorithm. The agency is also proposing changes to attestation requirements and additional technical requirements. CMS is also considering changes to civil monetary penalties for hospitals that do not comply with its price transparency requirements. Under the proposal, the civil monetary penalty would be reduced by 35% when a  hospital agrees with CMS’ determination of their noncompliance and waives the right to a hearing by an Administrative Law Judge.

Skin substitute payments

CMS is looking to change the way it pays for skin substitute products in alignment with proposals in the 2026 MPFS proposed rule. Currently under the OPPS, skin substitute products are unconditionally packaged. Current OPPS policy also divides skin substitutes into a high-cost and a low-cost group. In contrast, under current MPFS policy, skin substitutes are paid average sales price +6% when used in the non-facility setting. For 2026, CMS is proposing to unpackage skin substitute products when paid under the OPPS and establish Ambulatory Payment Classifications (APC) based on product characteristics. Similarly to its 2026 MPFS proposed rule proposals, the agency is proposing to align skin substitute categorization with the product’s FDA regulatory status. For 2026, CMS is proposing to use a single payment rate based on the highest average for the three FDA categories of skin substitute products. Different payments may be created for the three categories in future rulemaking. These policy changes would apply to both physician office settings and hospital outpatient departments.

Accelerated reductions related to 340B policy changes

CMS may greatly accelerate the rate at which it recoups the $7.8 billion in increased payments hospitals received for non-drug items and services under its vacated 340B policy from 2018-2022. In 2018, CMS enacted cuts to reimbursement under the 340B program; these cuts were kept budget neutral by increasing payment for non-drug items and services. The policy was the subject of litigation. It was eventually ruled unlawful in 2022 and CMS was required to recoup the funds it had distributed in the form of increased payments for non-drug items and services and pay back beneficiaries and hospitals that had been negatively affected by the 340B payment reduction. However, CMS maintained that it must uphold budget neutrality while making the payments. In 2023, CMS released a final rule outlining its plans to repay organizations negatively affected and recoup funds from organizations that received increased payments. Under that final rule, CMS reduced the OPPS conversion factor by 0.5% starting in 2026. The offset will continue until the full $7.8 billion is offset, which CMS estimates will take 16 years. Providers who didn't enroll in Medicare until after January 1, 2018, are excluded from the rate reduction. Now, in the 2026 OPPS proposed rule, CMS is considering to increase the annual reduction to the OPPS conversion factor from 0.5% to 2% effective January 1, 2026, excluding hospitals that enrolled in Medicare after January 1, 2018.  The 2% reduction would remain in effect until the estimated payment reduction reaches $7.8 billion in 2031, according to CMS’ estimates.

Other proposals

The proposed rule details numerous major changes to other programs and policies, including:

• Hospital Star Ratings
• Quality reporting programs
• Payment for partial hospitalization programs
• Payment for intensive outpatient programs
• Numerous other programs and policies

Learn more and take action

Revenue integrity professionals should read the proposed rule thoroughly, paying particular attention to proposals that could directly affect their communities, organizations, and job duties. Meet with colleagues in other departments, such as HIM, coding, CDI, and clinical department leaders, to discuss proposals that may have cross-functional impacts. Consider submitting comments to CMS and responding to the agency’s numerous requests for feedback. To help craft a meaningful comment, use NAHRI’s white paper Advocacy in Action: Commenting on Proposed Rules.

Members of the NAHRI Advisory Board will discuss the 2026 OPPS and 2026 MPFS proposed rules during the July 22 NAHRI Quarterly Call, to be held from 1 p.m. to 2 p.m. Eastern. Quarterly Calls are an exclusive benefit of NAHRI members and are always free to NAHRI members. NAHRI members may register for the call here. Non-members can gain access to the July call, and all other NAHRI member resources, by joining NAHRI.