Medicare Program: Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems; Quality Reporting Programs; Overall Hospital Quality Star Rating; Hospital Price Transparency; and Notice of Closure of a Teaching Hospital and Opportunity To Apply for Available Slots

This final rule with comment period is necessary to make updates to the Medicare hospital OPPS rates. It is also necessary to make changes to the payment policies and rates for outpatient services furnished by hospitals and CMHCs in CY 2026. We are required under section 1833(t)(3)(C)(ii) of the Act to update annually the OPPS conversion factor used to determine the payment rates for APCs. We also are required under section 1833(t)(9)(A) of the Act to review, not less often than annually, and revise the groups, the relative payment weights, and the wage and other adjustments described in section 1833(t)(2) of the Act. We must review the clinical integrity of payment groups and relative payment weights at least annually. We are revising the APC relative payment weights using claims data for services furnished on and after January 1, 2024, through and including December 31, 2024, and processed through June 30, 2025, and updated HCRIS cost report information.

This final rule with comment period is also necessary to make updates to the ASC payment rates for CY 2026, enabling CMS to make changes to payment policies and payment rates for covered surgical procedures and covered ancillary services that are performed in ASCs in CY 2026. Because ASC payment rates are based on the OPPS relative payment weights for most of the procedures performed in ASCs, the ASC payment rates are updated annually to reflect annual changes to the OPPS relative payment weights. In addition, we are required under section 1833(i)(1) of the Act to review and update the list of surgical procedures that can be performed in an ASC, not less frequently than every 2 years.

In the CY 2019 OPPS/ASC final rule with comment period (83 FR 59075 through 59079), we finalized a policy to update the ASC payment system rates using the hospital market basket update instead of the CPI-U for CY 2019 through 2023. In the CY 2024 OPPS/ASC final rule with comment period, we finalized a policy to extend the 5-year interim period by an additional 2 years, through CY 2024 and CY 2025, to enable us to more accurately analyze whether the application of the hospital market basket update to the ASC payment system resulted in a migration of services from the hospital setting to the ASC setting (88 FR 81960). As discussed in section XIII. of this final rule with comment period, we are extending our utilization of the hospital market basket update as the update factor for the ASC payment system for one additional year (through CY 2026). The ASC impacts discussed below reflect our application of the hospital market basket update for CY 2026.

In addition, this final rule with comment period is necessary to make policy changes for facilities reporting data under the Hospital OQR, REHQR, and ASCQR Programs. The primary objective of these quality reporting programs is to promote higher quality, more efficient health care for Medicare beneficiaries by collecting and reporting on quality- of-care metrics. This information is made available to consumers, both to empower Medicare beneficiaries and inform decision making, as well as to incentivize healthcare facilities to make continued improvements. This rule is also

necessary to modify the methodology for the Overall Hospital Quality Star Ratings to emphasize and align the importance of patient safety across CMS programs. The Overall Hospital Quality Star Ratings information is publicly available.

Also, this final rule with comment period is necessary to enhance clarity and standardization in hospital disclosure of standard charges. The Hospital Price Transparency regulations requiring public release of hospital standard charge information are a necessary and important first step in ensuring transparency in prices of healthcare services for consumers.

We have examined the impacts of this rule as required by Executive Order 12866, “Regulatory Planning and Review”; Executive Order 13132, “Federalism”; Executive Order 13563, “Improving Regulation and Regulatory Review”; Executive Order 14192, “Unleashing Prosperity Through Deregulation”; the Regulatory Flexibility Act (RFA) (Pub. L. 96-354); section 1102(b) of the Social Security Act; and section 202 of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4); and the Congressional Review Act (5 U.S.C. 804(2)).

Executive Orders 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select those regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity). Section 3(f) of Executive Order 12866 defines a “significant regulatory action” as any regulatory action that is likely to result in a rule that may: (1) have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities; (2) create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; (3) materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) raise novel legal or policy issues arising out of legal mandates, or the President's priorities.

A regulatory impact analysis (RIA) must be prepared for a regulatory action that is significant under section 3(f)(1) of E.O. 12866. Based on our estimates, the Office of Management and Budget's (OMB) Office of Information and Regulatory Affairs (OIRA) has determined this rulemaking is significant per section 3(f)(1). Accordingly, we have prepared a Regulatory Impact Analysis that to the best of our ability presents the costs and benefits of the rulemaking. Therefore, OMB has reviewed this final rule with comment period, and the Departments have provided the following assessment of their impact. In accordance with subtitle E of the Small Business Regulatory Enforcement Fairness Act of 1996 (also known as the Congressional Review Act), OIRA has also determined that this final rule meets the criteria set forth in 5 U.S.C. 804(2).

We estimate that the total increase in Federal Government expenditures under the OPPS for CY 2026, compared to CY 2025, due to the changes to the OPPS in this final rule with comment period, will be approximately $1.77 billion. Taking into account our estimated changes in enrollment, utilization, and case-mix for CY 2026 we estimate that the OPPS expenditures, including beneficiary cost-sharing, for CY 2026 will be approximately $101.0 billion, which is approximately $8.0 billion higher than estimated OPPS expenditures in CY 2025. Table 167 of this final rule with comment period displays the distributional impact of the CY 2026 changes in OPPS payment to various groups of hospitals and for CMHCs.

We note that under our proposed CY 2026 policy, drugs and biologicals are generally paid at ASP plus 6 percent, WAC plus 6 percent, or 95 percent of AWP, as applicable.

We estimate that the final update to the conversion factor will increase total OPPS payments by 2.6 percent in CY 2026. The final changes to the APC relative payment weights, the final changes to the wage indexes, the continuation of a payment adjustment for rural SCHs, including EACHs, and the final payment adjustment for cancer hospitals would not increase total OPPS payments because these changes to the OPPS are budget neutral. However, these updates would change the distribution of payments within the budget neutral system. We estimate that the total change in payments between CY 2025 and CY 2026, considering all budget-neutral payment adjustments, changes in estimated total outlier payments, the application of the frontier State wage adjustment, the payment adjustment for drug administration services furnished at excepted off campus PBDs, in addition to the application of the OPD fee schedule increase factor after all adjustments required by sections 1833(t)(3)(F), 1833(t)(3)(G), and 1833(t)(17) of the Act will increase total estimated OPPS payments by 2.4 percent. We note that, as previously discussed in section V.B.7 of this final rule with comment period, we reduce payments for non-drug items and services for hospitals for whom the annual reduction to payment amounts under Sec. [thinsp]419.32(b)(1)(iv)(B)(12) applies by 0.5 percentage points in CY 2026. We estimate that this reduction would reduce OPPS spending by $275 million in CY 2026.

We estimate the total increase (from changes to the ASC provisions in this final rule with comment period, as well as from enrollment, utilization, and case-mix changes) in Medicare expenditures (not including beneficiary cost-sharing) under the ASC payment system for CY 2026 compared to CY 2025, to be approximately $450 million. Tables 168 and 169 of this final rule with comment period display the redistributive impact of the CY 2026 changes regarding ASC payments, grouped by specialty area and then grouped by procedures with the greatest ASC expenditures, respectively.

1. Estimated Effects of OPPS Changes in This Final Rule With Comment Period a. Limitations of Our Analysis

The distributional impacts presented here are the projected effects of the proposed CY 2026 policy changes on various hospital groups. We post our hospital-specific estimated payments for CY 2026 on the CMS website with the other supporting documentation for this final rule with comment period. To view the hospital-specific estimates, we refer readers to the CMS website at https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient. On the website, select “Regulations and Notices” from the left side of the page and then select “CMS-1834-FC” from the list of regulations and notices. The hospital-specific file layout and the hospital-specific file are listed with the other supporting documentation for this final rule. We show hospital-specific data only for hospitals whose claims were used for modeling the impacts shown in Table 167 of this final rule with comment period. We do not show hospital-specific impacts for hospitals whose claims we were unable to use. We refer readers to section II.A. of this final rule with comment period for a discussion of the hospitals whose claims we do not use for ratesetting or impact purposes.

We estimate the effects of the individual policy changes by estimating payments per service, while holding all other payment policies constant. We use the best data available but do not attempt to predict behavioral responses to our policy changes in order to isolate the effects associated with specific policies or updates, but any policy that changes payment could have a behavioral response. In addition, we have not made any adjustments for future changes in variables, such as service volume, service-mix, or number of encounters. b. Estimated Effects To Control Unnecessary Increases in the Volume of Outpatient Services Furnished in Excepted Off-Campus Provider Based Departments (PBDs)

In section X.A. of this final rule with comment period, we discuss our CY 2026 policy to control for unnecessary increases in the volume of outpatient services by paying for drug administration services furnished at an off-campus PBD at an amount equal to the site-specific PFS payment rate for nonexcepted items and services furnished by a nonexcepted off-campus PBD (the PFS payment rate). Specifically, we pay for HCPCS codes billed with modifier “PO” and assigned to and paid through drug administration APCs 5691 through 5694 at an amount equal to the site-specific PFS payment rate for nonexcepted items and services furnished by a nonexcepted off-campus PBD (the PFS payment rate). For a discussion of the PFS relativity adjuster that is used to pay for all drug administration services provided at all off-campus PBDs, we refer readers to the CY 2018 PFS final rule with comment period discussion (82 FR 53023 through 53024), as well as the CY 2019 PFS proposed rule.

To develop an estimated impact of this policy, we began with CY 2024 outpatient claims data used, for claim lines with HCPCS codes assigned for payment through drug administration APCs 5691 through 5694 that contained modifier “PO” because the presence of this modifier indicates that such claims were billed for services furnished by an off-campus department of a hospital paid under the OPPS. We then simulated payment for the remaining claim lines as if they were paid at the PFS-equivalent rate, removing a portion of the payment associated with rural Sole Community Hospitals based on our finalized exception for those hospitals. An estimate of the final policy that includes the effects of estimated changes in enrollment, utilization, and case-mix based on the FY 2026 Mid-Session review budget approximates the estimated decrease in total payments at $290 million, with Medicare OPPS payments decreasing by $220 million and beneficiary copayments decreasing by $70 million in CY 2026.

This estimate is utilized for the accounting statement displayed in Table 170 of this final rule with comment period because the impact of this final CY 2026 policy, which is not budget neutral, is combined with the impact of the OPD update, which is also not budget neutral, to estimate changes in Medicare spending under the OPPS as a result of the changes in this rule.

We note our estimates may differ from the actual effect of the proposed policy due to offsetting factors, such as changes in provider behavior. We note that by removing this payment differential that may influence site-of-service decision-making, we anticipate an associated decrease in the volume of drug administration services provided in the excepted off-campus PBD setting. [GRAPHIC] [TIFF OMITTED] TR25NO25.256

Comment: A commenter requested additional clarification regarding the figures in Table 111 of the CY 2026 OPPS/ASC proposed rule. They noted that while their estimates remained relatively similar to the Table in CY 2026, for the latter years of the table their estimates differed significantly.

Response: Table 166 of this final rule with comment period updates the estimated effect of changes related to the excepted off-campus drug administration payment policy. In the table displaying the effects of the final policy, the CY 2026 estimates are primarily isolated to effects on OPPS payments and are also what are included in Table 170 of this final rule with comment period. However, in CY 2027 and later years of Table 166 of this final rule with comment period, the savings estimates also include the impact of this policy on reducing Medicare Advantage payments starting in CY 2027, and this is why the estimates in Table 111 of the CY 2026 OPPS/ASC proposed rule were greater than the commenter's estimates beginning in CY 2027. c. Estimated Effects of OPPS Changes on Hospitals

Table 167 shows the estimated impact of the final rule with comment period on hospitals. Historically, the first line of the impact table, which estimates the change in payments to all facilities, has always included cancer and children's hospitals, which are held harmless to their pre-Balanced Budget Act (BBA) amount. We also include CMHCs in the first line that includes all providers. We include a second line for all hospitals, excluding permanently held harmless hospitals and CMHCs.

We present separate impacts for CMHCs in Table 167, and we discuss them separately below, because CMHCs are paid only for partial hospitalization and intensive outpatient program services under the OPPS and are a different provider type from hospitals. In the CY 2025 OPPS/ASC final rule with comment period (89 FR 94269 through 94270), we finalized paying CMHCs for partial hospitalization services and intensive outpatient services under APCs 5851 through 5854. For CY 2026, we are maintaining the same APC structure and revising our methodology for calculating APC payment rates. Specifically, we are finalizing our proposal to apply the 40 percent Medicare Physician Fee Schedule (MPFS) Relativity Adjuster to calculate PHP and IOP payment rates for CMHCs.

The estimated increase in the total payments made under the OPPS is determined largely by the increase to the conversion factor under the statutory methodology. The distributional impacts presented do not include assumptions about changes in volume and service-mix. The conversion factor is updated annually by the OPD fee schedule increase factor, as discussed in detail in section II.B. of this final rule with comment period.

Section 1833(t)(3)(C)(iv) of the Act provides that the OPD fee schedule increase factor is equal to the market basket percentage increase applicable under section 1886(b)(3)(B)(iii) of the Act, which we refer to as the IPPS market basket percentage increase. The final IPPS market basket percentage increase applicable to the OPD fee schedule for CY 2026 is 3.3 percent. Section 1833(t)(3)(F)(i) of the Act reduces that 3.3 percent by the productivity adjustment described in section 1886(b)(3)(B)(xi)(II) of the Act, which is a 0.7 percentage point for CY 2026 (which is also the productivity adjustment for FY 2026 in the FY 2026 IPPS/LTCH PPS proposed rule (90 FR 18257)) resulting in the proposed CY 2026 OPD fee schedule increase factor of 2.6 percent. We are using the OPD fee schedule increase factor of 2.6 percent in the calculation of the final CY 2026 OPPS conversion factor. Section 10324 of the Affordable Care Act, as amended by HCERA, further authorized additional expenditures outside budget neutrality for hospitals in certain frontier States that have a wage index less than 1.0000. The amounts attributable to this frontier State wage index adjustment are incorporated in the estimates in Table 167 of this final rule with comment period.

To illustrate the impact of the CY 2026 changes, our analysis begins with a baseline simulation model that uses the CY 2025 relative payment weights, the CY 2025 final OPPS wage indexes that include reclassifications, and the final CY 2025 conversion factor. Table 167 shows the estimated redistribution of the increase or decrease in payments for CY 2026 over CY 2025 payments to hospitals and CMHCs as a result of the following factors: the impact of the APC reconfiguration and recalibration changes between CY 2025 and CY 2026 (Column 2); the wage indexes and the provider adjustments (Column 3); the combined impact of all of the changes described in the preceding columns plus the 2.6 percent OPD fee schedule increase factor update to the conversion factor (Column 4); the additional estimated impact for the payment adjustment for drug administration furnished at excepted off campus PBDs (Column 5); the estimated impact taking into account all payments for CY 2026 relative to all payments for CY 2025, including the impact of changes in estimated outlier payments and changes to the pass-through payment estimate (Column 6).

We did not model an explicit budget neutrality adjustment for the rural adjustment for SCHs because we are maintaining the current adjustment percentage for CY 2026. Because the final updates to the conversion factor (including the update of the OPD fee schedule increase factor), the estimated cost of the rural adjustment, and the estimated cost of projected pass-through payment for CY 2026 are applied uniformly across services, observed redistributions of payments in the impact table for hospitals largely depend on the mix of services furnished by a hospital (for example, how the APCs for the hospital's most frequently furnished services would change), and the impact of the wage index changes on the hospital. However, total payments made under this system and the extent to which this final rule with comment period would redistribute money during implementation also will depend on changes in volume, practice patterns, and the mix of services billed between CY 2025 and CY 2026 by various groups of hospitals, which CMS cannot forecast.

Overall, we estimate that the final rates for CY 2026 will increase Medicare OPPS payments by an estimated 2.4 percent. Removing payments to cancer and children's hospitals because their payments are held harmless to the pre-OPPS ratio between payment and cost and removing payments to CMHCs results in an estimated 2.5 percent increase in Medicare payments to all other hospitals. These estimated payments will not significantly impact other providers. We note that providers not considered “new providers” for purposes of the 340b remedy offset would receive an adjustment to their OPPS payment rates. Column 1: Total Number of Hospitals

The first line in Column 1 in Table 167 shows the total number of facilities (3,543), including designated cancer and children's hospitals and CMHCs, for which we were able to use CY 2024 hospital outpatient and CMHC claims data to model CY 2025 and CY 2026 payments, by classes of hospitals, for CMHCs and for dedicated cancer hospitals. We excluded all hospitals and CMHCs for which we could not plausibly estimate CY 2025 or CY 2026 payment and entities that are not paid under the OPPS. The latter entities include CAHs, IHS and tribal hospitals, and hospitals located in Guam, the U.S. Virgin Islands, Northern Mariana Islands, American Samoa, and the State of Maryland. This process is discussed in greater detail in section II.A. of this final rule with comment period. At this time, we are unable to calculate a DSH variable for hospitals that are not also paid under the IPPS because DSH payments are only made to hospitals paid under the IPPS. Hospitals for which we do not have a DSH variable are grouped separately and generally include freestanding psychiatric hospitals, rehabilitation hospitals, and long-term care hospitals. We show the total number of OPPS hospitals (3,439), excluding the hold harmless cancer and children's hospitals and CMHCs, on the second line of the table. We excluded cancer and children's hospitals because section 1833(t)(7)(D) of the Act permanently holds harmless cancer hospitals and children's hospitals to their “pre-BBA amount” as specified under the terms of the statute, and therefore, we removed them from our impact analyses. We show the isolated impact on the 34 CMHCs at the bottom of the impact table (Table 167) and discuss that impact separately below. Column 2: APC Recalibration--All Changes

Column 2 shows the estimated effect of APC recalibration. Column 2 also reflects any changes in multiple procedure discount patterns or conditional packaging that occur as a result of the changes in the relative magnitude of payment weights. As a result of APC recalibration, we estimate that urban hospitals will experience a 0.1 increase, with the impact ranging

from no change to an increase of 0.2, depending on the number of beds. Rural hospitals will experience a decrease of 0.4 percent overall. Major teaching hospitals will experience no change. Column 3: Wage Indexes and the Effect of the Provider Adjustments

Column 3 demonstrates the combined budget neutral impact of the APC recalibration, the updates for the wage indexes with the FY 2026 IPPS post-reclassification wage indexes, the rural adjustment, the frontier adjustment, and the cancer hospital payment adjustment. We modeled the independent effect of the budget neutrality adjustments and the OPD fee schedule increase factor by using the relative payment weights and wage indexes for each year and using a CY 2025 conversion factor that included the OPD fee schedule increase and a budget neutrality adjustment for differences in wage indexes.

Column 3 reflects the independent effects of the updated wage indexes, including the application of budget neutrality for the rural floor policy on a nationwide basis, as well as the final CY 2026 changes in wage index policy, discussed in section II.C. of this final rule with comment period. We did not model a budget neutrality adjustment for the rural adjustment for SCHs because we are continuing the rural payment adjustment of 7.1 percent to rural SCHs for CY 2026, as described in section II.E. of this final rule with comment period. We modeled a budget neutrality adjustment for the final cancer hospital payment adjustment because the final payment-to-cost ratio target for the cancer hospital payment adjustment in CY 2026 is 0.87, which is the same PCR target adopted in the CY 2025 OPPS/ASC final rule with comment period (89 FR 93979). We note that, in accordance with section 16002 of the 21st Century Cures Act, we apply a budget neutrality factor calculated as if the cancer hospital adjustment target payment-to-cost ratio was 0.88, not the 0.87 target payment-to-cost ratio we discuss in section II.F. of this final rule with comment period.

We modeled the independent effect of updating the wage indexes by varying only the wage indexes, holding APC relative payment weights, service-mix, and the rural adjustment constant and using the CY 2026 scaled weights and a CY 2025 conversion factor that included a budget neutrality adjustment for the effect of the changes to the wage indexes between CY 2025 and CY 2026. Column 4: All Budget Neutrality Changes Combined With the Market Basket Update

Column 4 demonstrates the combined impact of all the final changes previously described and the update to the conversion factor of 2.6 percent. Overall, these changes would increase payments to urban hospitals by 2.8 percent and to rural hospitals by 2.4 percent. Rural sole community hospitals would receive an estimated increase of 2.8 percent while other rural hospitals would receive an estimated increase of 1.8 percent. Column 5--Final Off-Campus PBD Drug Administration Payment Policy

Column 5 displays the estimated effect of our final CY 2026 policy to pay for drug administration services assigned to APCs 5691 through 5694 when billed with modifier “PO” at a PFS-equivalent rate. We note that the numbers provided in this column isolate the estimated effect of this final policy adjustment relative to the numerator of Column 4. Therefore, the numbers reported in Column 5 show how much of the difference between the estimates in Column 4 and the estimates in Column 6 are a result of the off-campus PBD drug administration policy. Column 6: All Changes With Outlier--Final CY 2026 Update

Column 6 depicts the full impact of the final CY 2026 policies on each hospital group by including the effect of all changes for CY 2026 and comparing them to all estimated payments in CY 2025. Column 6 shows the combined budget neutral effects of Columns 2 and 3; the effect of the off-campus provider-based department drug administration policy; the OPD fee schedule increase; the impact of estimated OPPS outlier payments, as discussed in section II.G. of this final rule with comment period; the Hospital OQR Program payment reduction for the small number of hospitals in our impact model that failed to meet the reporting requirements (discussed in section XV. of this final rule with comment period); and other rule adjustments to the CY 2026 OPPS payments.

Of those hospitals that failed to meet the Hospital OQR Program reporting requirements for the full CY 2025 update (and assumed, for modeling purposes, to be the same number for CY 2026), we included 75 hospitals in our model because they had both CY 2024 claims data and recent cost report data. We estimate that the cumulative effect of all changes for CY 2026 would increase payments to all facilities by 2.4 percent for CY 2026. We modeled the independent effect of all changes in Column 6 using the final relative payment weights for CY 2025 and the proposed relative payment weights for CY 2026. We used the final conversion factor for CY 2025 of $89.169 and a CY 2026 conversion factor of $91.415 discussed in section II.B. of this final rule with comment period.

Column 6 contains simulated outlier payments for each year. We used the 1-year charge inflation factor used in the FY 2026 IPPS/LTCH PPS final rule (90 FR 37227) of 5.5 percent (1.05505) to increase charges on the CY 2024 claims, and we used the overall CCR in the July 2025 Outpatient Provider-Specific File (OPSF) to estimate outlier payments for CY 2025. Using the CY 2024 claims and a 5.5 percent charge inflation factor, we currently estimate that outlier payments for CY 2025, using a multiple threshold of 1.75 and a fixed-dollar threshold of $7,175, would be approximately 0.95 percent of total payments. The estimated current outlier payments of 0.95 percent are incorporated in the comparison in Column 5. We used the same set of claims and a charge inflation factor of 11.3 percent (1.11313) and the CCRs in the July 2025 OPSF, with an adjustment of 0.956081 (90 FR 37227), to reflect relative changes in cost and charge inflation between CY 2025 and CY 2026, to model the final CY 2026 outliers at 1.0 percent of estimated total payments using a multiple threshold of 1.75 and a fixed dollar threshold of $6,225. The charge inflation and CCR inflation factors are discussed in detail in the FY 2026 IPPS/LTCH PPS final rule (90 FR 37224 through 37228).

Overall, we estimate that facilities will experience an increase of 2.4 percent under this final rule in CY 2026 relative to total spending in CY 2025. This projected increase (shown in Column 6) of Table 167 of this final rule with comment period reflects the final 2.6 percent OPD fee schedule increase factor, adding the 0.05 difference in estimated outlier payments between CY 2025 (0.95 percent) and CY 2026 (1.0 percent), including the -0.3 percent decrease due to the payment adjusted for drug administration at off campus PBDs, plus 0.07 percent for the change in the pass-through payment estimate between CY 2025 and CY 2026. We estimate that the combined effect of all changes for CY 2026 will increase payments to urban hospitals by 2.6 percent. Overall, we estimate that rural hospitals will experience a 2.3 percent increase as a result of the combined effects of all the changes for CY 2026.

Among hospitals, by teaching status, we estimate that the impacts resulting from the combined effects of all changes include an increase of 2.4 percent for major teaching hospitals and an increase of 2.6 percent for nonteaching hospitals. Minor teaching hospitals will experience an estimated increase of 2.7 percent.

In our analysis, we also have categorized hospitals by type of ownership. Based on this analysis, we estimate that voluntary hospitals will experience an increase of 2.5 percent, proprietary hospitals will experience an increase of 3.3 percent, and governmental hospitals will experience an increase of 2.1 percent. Reduction for Providers Subject to the 340B Remedy Offset

In column 7 we have included additional information to account for estimated changes in the CY 2026 OPPS for providers subject to the 340B Remedy Offset. BILLING CODE 4120-01-P

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BILLING CODE 4120-01-C

The last line of Table 167 demonstrates the isolated impact on CMHCs, which furnished only partial hospitalization and intensive outpatient program services under the OPPS during CY 2024. As discussed in section VIII.C. of this final rule with comment period, we are finalizing for CY 2026 to continue paying CMHCs using APCs 5851 through 5854. We modeled the impact of this APC policy, assuming CMHCs will continue to provide the same PHP and IOP care as seen in the CY 2024 claims used for ratesetting in the final rule with comment period. We did not exclude days with one or two services from our modeling for CY 2026, because our final rule policy would pay the per diem rate for APC 5853 for such days in CY 2026. As a result of the final PHP APC changes for CMHCs, we estimate that CMHCs will experience a 0.7 percent decrease in CY 2026 payments relative to their CY 2025 payments (shown in Column 2). For a detailed discussion of our final PHP and IOP policies, please see section VIII. of this final rule with comment period.

Column 3 shows the estimated impact of adopting the final FY 2026 wage index values, which result in an estimated increase of 0.2 percent to CMHCs.

Column 4 shows that combining the OPD fee schedule increase factor, along with the final changes in APC policy for CY 2026 and the final FY 2026 wage index updates, will result in an estimated increase of 2.1 percent. e. Estimated Effect of OPPS Changes on Beneficiaries

For services for which the beneficiary pays a copayment of 20 percent of the payment rate, the beneficiary's payment would increase for services for which the OPPS payments would rise and decrease for services for which the OPPS payments would fall. For further discussion of the calculation of the national unadjusted copayments and minimum unadjusted copayments, we refer readers to section II.H. of this final rule with comment period. In all cases, section 1833(t)(8)(C)(i) of the Act limits beneficiary liability for copayment for a procedure performed in a year to the hospital inpatient deductible for the applicable year.

We estimate that the aggregate beneficiary coinsurance percentage would be approximately 18 percent for all services paid under the OPPS in CY 2026. The estimated aggregate beneficiary coinsurance reflects general system adjustments. We note that the individual payments, and therefore copayments, associated with services may differ based on the setting in which they are furnished. However, at the aggregate system level, we do not currently observe significant impact on beneficiary coinsurance as a result of those policies. f. Estimated Effects of OPPS Changes on Other Providers

The relative payment weights and payment amounts established under the OPPS affect the payments made to ASCs, as discussed in section XIII. of this final rule with comment period. Hospitals, CMHCs, and ASCs will be affected by the changes in this final rule. Additionally, the payment policies we established for IOP services affect RHCs and FQHCs. These providers of IOP are not paid under the OPPS and are not included in the impact analysis shown in Table 167. However, the final payment amount for OPPS APC 5861 will affect payments to RHCs and FQHCs since under sections 1834(o)(5)(A) and 1834(y)(3)(A) of the Act payment for IOP services in these settings is required to be equal to the payment determined for IOP services in the hospital outpatient department. g. Estimated Effects of OPPS Changes on the Medicare and Medicaid Programs

The effect of the update on the Medicare program is expected to be an increase of $1.77 billion in program payments for OPPS services furnished in CY 2026. The effect on the Medicaid program is expected to be limited to copayments that Medicaid may make on behalf of Medicaid recipients who are also Medicare beneficiaries. We estimate that the changes in this final rule with comment period will increase these Medicaid beneficiary payments by approximately $145 million in CY 2026. Currently, there are approximately 11.5 million dual-eligible beneficiaries, which represent approximately 40 percent of Medicare Part B fee-for-service beneficiaries. The impact on Medicaid was determined by taking 40 percent of the beneficiary cost-sharing impact. The national average split of Medicaid payments is 58 percent Federal payments and 42 percent State payments. Therefore, for the estimated $145 million Medicaid increase, approximately $85 million will be from the Federal Government and $60 million will be from State governments. h. Alternative OPPS Policies Considered

Alternatives to the OPPS changes we proposed and the reasons for our selected alternatives are discussed throughout this final rule with comment period. Alternatives Considered for the Final Payment Policy for Skin Substitute Products

We considered several alternatives to our policy to group skin substitute products based on FDA regulatory category. For example, we considered grouping skin substitute products based on their composition (for example, whether they are non-synthetic or synthetic) or by graft type (e.g., allograft or xenograft). We also considered grouping all products together to set a single payment rate or creating new categories reflecting product cost, similar to our current payment policy. All of these alternatives considered would be implemented in a budget neutral manner and would involve unpackaging the current costs of skin substitute products from the application procedures, resulting in separate payments for skin substitute products under the OPPS and ASC. For a more detailed discussion of our CY 2026 payment policy for skin substitutes, please see section V. of this final rule with comment period. 2. Estimated Effects of CY 2026 ASC Payment System Changes

Most ASC payment rates are calculated by multiplying the ASC conversion factor by the ASC relative payment weight. As discussed fully in section XIII. of this final rule with comment period, we are setting the CY 2026 ASC relative payment weights by scaling the final CY 2026 OPPS relative payment weights by the final CY 2026 ASC scalar of 0.872. The estimated effects of the updated relative payment weights on payment rates are varied and are reflected in the estimated payments displayed in Tables 168 and 169.

Beginning in CY 2011, section 3401 of the Affordable Care Act requires that the annual update to the ASC payment system after application of any quality reporting reduction be reduced by a productivity adjustment. In CY 2019, we adopted a policy for the annual update to the ASC payment system to be the hospital market basket update for CY 2019 through CY 2023. In the CY 2024 OPPS/ASC final rule with comment period, we extended this 5-year interim period an additional 2 years through CYs 2024 and 2025. As discussed in further detail in section XIII. of this final rule with comment period, we are finalizing an extension of our utilization of the hospital market basket update as the update factor to the ASC payment system for 1 additional year (through CY 2026). Section 1886(b)(3)(B)(xi)(II) of the

Act defines the productivity adjustment to be equal to the 10-year moving average of changes in annual economy-wide private nonfarm business multifactor productivity (as projected by the Secretary for the 10-year period, ending with the applicable fiscal year, year, cost reporting period, or other annual period). For ASCs that fail to meet their quality reporting requirements, the CY 2026 payment determinations would be based on the application of a 2.0 percentage point reduction to the hospital market basket update for CY 2026. We calculated the final CY 2026 ASC conversion factor by adjusting the CY 2025 ASC conversion factor ($54.895) by 1.0000 to account for changes in the pre-floor and pre-reclassified hospital wage indexes between CY 2025 and CY 2026, which includes our policy to limit wage index declines of greater than 5 percent, and by applying the CY 2026 hospital market basket update factor of 2.6 percent (which is equal to the final inpatient hospital market basket percentage increase of 3.3 percent reduced by a productivity adjustment of 0.7 percentage point). The final CY 2026 ASC conversion factor is $56.322 for ASCs that successfully meet the quality reporting requirements. a. Limitations of Our Analysis

Presented here are the projected effects of the final changes for CY 2026 on Medicare payment to ASCs. A key limitation of our analysis is our inability to predict changes in ASC service-mix between CY 2024 and CY 2026 with precision. We believe the net effect on Medicare expenditures resulting from the final CY 2026 changes would be small in the aggregate for all ASCs. However, such changes may have differential effects across surgical specialty groups, as ASCs continue to adjust to the payment rates based on the policies of the revised ASC payment system. We are unable to accurately project such changes at a disaggregated level. Clearly, individual ASCs would experience changes in payment that differ from the aggregated estimated impacts presented below. b. Estimated Effects of ASC Payment System Policies on ASCs

Some ASCs are multispecialty facilities that perform a wide range of surgical procedures from excision of lesions to hernia repair to cataract extraction; others focus on a single specialty and perform only a limited range of surgical procedures, such as ophthalmology, digestive system, or orthopedic procedures. The combined effect of the final update to the payments on an individual ASC would depend on a number of factors, including, but not limited to, the mix of services the ASC provides, the volume of specific services provided by the ASC, the percentage of its patients who are Medicare beneficiaries, and the extent to which an ASC provides different services in the coming year. The following discussion includes tables that display estimates of the impact of the final CY 2026 updates to the ASC payment system on Medicare payments to ASCs, assuming the same mix of services, as reflected in our CY 2024 claims data. Table 168 depicts the estimated aggregate percent change in payment by surgical specialty or ancillary items and services group by comparing estimated CY 2025 payments to estimated CY 2026 payments, and Table 169 shows a comparison of estimated CY 2025 payments to estimated CY 2026 payments for items and procedures that we estimate would receive the most Medicare payment in CY 2025.

In Table 168, we have aggregated the surgical HCPCS codes by specialty group, grouped all HCPCS codes for covered ancillary items and services into a single group, and then estimated the effect on aggregated payment for surgical specialty and ancillary items and services groups. The groups are sorted for display in descending order by estimated Medicare program payment to ASCs. The following is an explanation of the information presented in Table 168.

Column 1--Surgical Specialty or Ancillary Items and Services Group indicates the surgical specialty into which ASC procedures are grouped and the ancillary items and services group, which includes all HCPCS codes for covered ancillary items and services. To group surgical procedures by surgical specialty, we used the CPT code range definitions and Level II HCPCS codes and Category III CPT codes, as appropriate, to account for all surgical procedures to which the Medicare program payments are attributed.

Column 2--Estimated CY 2025 ASC Payments were calculated using CY 2024 ASC utilization data (the most recent full year of ASC utilization) and CY 2025 ASC payment rates. The surgical specialty groups are displayed in descending order based on estimated CY 2025 ASC payments.

Column 3--Estimated CY 2026 Percent Change is the aggregate percentage increase or decrease in Medicare program payment to ASCs for each surgical specialty or ancillary items and services group that is attributable to final updates to ASC payment rates for CY 2026 compared to CY 2025.

As shown in Table 168, for the six specialty groups that account for the most ASC utilization and spending, we estimate that the final update to ASC payment rates for CY 2026 would result in a 4 percent increase in aggregate payment amounts for eye and ocular adnexa procedures, a 2 percent increase in aggregate payment amounts for musculoskeletal system procedures, a 2 percent increase in aggregate payment amounts for nervous system procedures, a 3 percent increase in aggregate payment amounts for digestive system procedures, a 5 percent increase in aggregate payment amounts for cardiovascular system procedures, and a 12 percent increase in aggregate payment amounts for genitourinary system procedures. We note that these changes can be a result of different factors, including updated data, payment weight changes, and changes in policy. In general, spending in each of these categories of services is increasing due to the 2.6 percent payment rate update. After the payment rate update is accounted for, aggregate payment increases or decreases for a category of services can be higher or lower than a 2.6 percent increase, depending on if payment weights in the OPPS APCs that correspond to the applicable services increased or decreased or if the most recent data show an increase or a decrease in the volume of services performed in an ASC for a category. For example, we estimate a 4 percent increase in eye surgical procedure payments. The increase in expenditures for eye surgical procedures is largely a result of the 2.6 percent hospital market basket update. The large increases in genitourinary procedure expenditures are a result of higher APC level assignment in the OPPS of newer prostate biopsy procedure codes compared to prior prostate biopsy procedure codes. For estimated changes for selected procedures, we refer readers to Table 168.

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Table 169 shows the estimated impact of the updates to the revised ASC payment system on aggregate ASC payments for selected surgical procedures during CY 2026. The table displays 30 of the procedures receiving the greatest estimated CY 2025 aggregate Medicare payments to ASCs. The HCPCS codes are sorted in descending order by estimated CY 2025 program payment.

Column 1-CPT/HCPCS code.

Column 2-Short Descriptor of the HCPCS code.

Column 3-Estimated CY 2025 ASC Payments were calculated using CY 2024 ASC utilization (the most recent full year of ASC utilization) and the CY 2025 ASC payment rates. The estimated CY 2025 payments are expressed in millions of dollars.

Column 4-Estimated CY 2026 Percent Change reflects the percent differences between the estimated ASC payment for CY 2025 and the estimated payment for CY 2026 based on the final update.

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We estimate that the CY 2026 update to the ASC payment system will be generally positive (that is, result in lower cost-sharing) for beneficiaries with respect to the procedures we are finalizing to add to the ASC CPL for CY 2026. First, other than certain preventive services where coinsurance and the Part B deductible are waived to comply with sections 1833(a)(1) and (b) of the Act, the ASC coinsurance rate for all procedures is 20 percent. This contrasts with procedures performed in HOPDs under the OPPS, where the beneficiary is responsible for copayments that range from 20 percent to 40 percent of the procedure payment (other than for certain preventive services), although the majority of HOPD procedures have a 20-percent copayment. Second, in almost all cases, the ASC payment rates under the ASC payment system are lower than payment rates for the same procedures under the OPPS. Therefore, the beneficiary coinsurance amount under the ASC payment system will usually be less than the OPPS copayment amount for the same services. (The only exceptions will be if the ASC coinsurance amount exceeds the hospital inpatient deductible since the statute requires that OPPS copayment amounts not exceed the hospital inpatient deductible. Therefore, in limited circumstances, the ASC coinsurance amount may exceed the hospital inpatient deductible and, therefore, the OPPS copayment amount for similar services.) Beneficiary coinsurance for services migrating from physicians' offices to ASCs may decrease or increase under the ASC payment system, depending on the particular service and the relative payment amounts under the MPFS compared to the ASC. While the ASC payment system bases most of its payment rates on hospital cost data used to set OPPS relative payment weights, services that are performed a majority of the time in a physician office are generally paid the lesser of the ASC amount according to the standard ASC ratesetting methodology or at the nonfacility practice expense-based amount payable under the PFS. For those additional procedures that we finalized to designate as office- based in CY 2026, the beneficiary coinsurance amount under the ASC payment system generally will be no greater than the

beneficiary coinsurance under the PFS because the coinsurance under both payment systems generally is 20 percent (except for certain preventive services where the coinsurance is waived under both payment systems). Accounting Statements and Tables for OPPS and ASC Payment System

As required by OMB Circular A-4 (available on the Office of Management and Budget website at https://trumpwhitehouse.archives.gov/sites/whitehouse.gov/files/omb/circulars/A4/a-4.pdf), we have prepared accounting statements to illustrate the impacts of the OPPS and ASC changes in this final rule with comment period. The first accounting statement, Table 170, illustrates the classification of expenditures for the CY 2026 estimated hospital OPPS incurred benefit impacts associated with the final CY 2026 OPD fee schedule increase and the final policy for drug administration services furnished at excepted off-campus PBDs. The second accounting statement, Table 171, illustrates the classification of expenditures associated with the 2.6 percent CY 2026 update to the ASC payment system, based on the provisions of the final rule with comment period and the baseline spending estimates for ASCs. Both tables classify most estimated impacts as transfers. The third accounting statement, Table 172, outlines the one-time burden associated with the HPT requirements we are finalizing in this rule. [GRAPHIC] [TIFF OMITTED] TR25NO25.262

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We did not receive public comments on this provision, and therefore, we are finalizing as proposed. 3. Effects of Changes in Requirements for the Hospital Outpatient Quality Reporting (OQR) Program a. Background

We refer readers to the CY 2025 OPPS/ASC final rule with comment period (89 FR 94561 and 94562) for the previously estimated effects of changes to the Hospital OQR Program for the CY 2025 reporting period and subsequent years. Of the 3,014 hospital outpatient departments (HOPDs) that met eligibility requirements for the CY 2025 payment determination for the Hospital OQR Program, we determined that 42 HOPDs did not meet the program requirements to receive the full annual Outpatient Department (OPD) fee schedule increase factor while an additional 54 HOPDs elected not to participate. b. Impact of CY 2026 OPPS/ASC Final Rule Policies

We are finalizing: (1) removal of the COVID-19 Vaccination Coverage Among Healthcare Personnel (HCP) measure beginning with the CY 2024 reporting period/CY 2026 payment determination; (2) removal of the Hospital Commitment to Health Equity (HCHE) measure beginning with the CY 2025 reporting period/CY 2027 payment determination; (3) removal of the Screening for Social Drivers of Health (SDOH) measure beginning with the CY 2025 reporting period; (4) removal of the Screen Positive Rate for SDOH measure beginning with the CY 2025 reporting period; (5) adoption of the Emergency Care Access & Timeliness electronic clinical quality measure (eCQM) with voluntary reporting for the CY 2027 reporting period followed by mandatory reporting beginning with the CY 2028 reporting period/CY 2030 payment determination; (6) removal of the Median Time from Emergency Department (ED) Arrival to ED Departure for Discharged ED Patients (Median Time for Discharged ED Patients) measure beginning with the CY 2028 reporting period/CY 2030 payment determination; (7) removal of

the Left Without Being Seen (LWBS) measure beginning with the CY 2028 reporting period/CY 2030 payment determination; and (8) modification of the Excessive Radiation Dose or Inadequate Image Quality for Diagnostic Computed Tomography (CT) in Adults (Hospital Level--Outpatient) eCQM (Excessive Radiation eCQM) from mandatory reporting beginning with the CY 2027 reporting period to continue voluntary reporting in the CY 2027 reporting period and subsequent years.

In section XV.D. of this final rule with comment period, we updated our Extraordinary Circumstances Exception (ECE) policy for the Hospital OQR Program. This update will explicitly include extensions as a type of extraordinary circumstances relief option, in addition to exceptions. Because the process for requesting or granting an ECE will remain the same as the current ECE process, these updates will not affect burden associated with the submission of the ECE form.

We refer readers to section “XXIII.A. Collection of Information” of this final rule with comment period for a detailed discussion of the calculations estimating the changes to the information collection and reporting burden for finalized data requirements under the Hospital OQR Program for the estimated 3,200 program-eligible HOPDs. As shown in summary tables in section XXIII.A.10, we estimate a total information collection and reporting burden decrease of 6,924,988 hours at a savings of $178,884,367 annually associated with our proposals for the CY 2028 reporting period/CY 2030 payment determination and subsequent years compared to our currently approved information collection burden estimates under OMB control number 0938-1109 (expiration date January 31, 2026). We also estimate a decrease of between 25,600 hours at a savings of $1,446,400 and 28,800 hours at a savings of $1,687,680 in information collection burden associated with the removal of the COVID- 19 Vaccination Coverage Among HCP measure compared to the currently approved information collection burden estimates and under OMB control number 0920-1317 (expiration date January 31, 2028).

In section XV.B.1. of this final rule with comment period, we adopted the Emergency Care Access & Timeliness eCQM. Similar to the effects associated with the ST-Segment Elevation Myocardial Infarction (STEMI) eCQM finalized in the CY 2022 OPPS/ASC final rule with comment period (86 FR 63984 and 63985), we believe that costs associated with adoption of eCQMs are multifaceted and include not only the burden associated with reporting but also the costs associated with implementing and maintaining program requirements, such as maintaining measure specifications in hospitals' electronic health record (EHR) systems for the eCQMs used in the Hospital OQR Program.

In section XV.B.2. of this final rule with comment period, we finalized the removal of the Median Time from ED Arrival to ED Departure for Discharged ED Patients and LWBS measures in coordination with the adoption of the Emergency Care Access & Timeliness eCQM. Because these measures will be replaced by the Emergency Care Access & Timeliness eCQM, we believe HOPDs will be positively impacted by the decreased effort required to report one eCQM rather than one chart- abstracted measure and one web-based measure.

In section XV.B.3, of this final rule with comment period, we modified the reporting requirements for the Excessive Radiation eCQM by maintaining voluntary reporting instead of mandatory reporting of the measure, beginning with the CY 2027 reporting period. In the CY 2024 OPPS/ASC final rule with comment period, we stated that for the Excessive Radiation eCQM, HOPDs may incur costs associated with implementing and maintaining program requirements, such as maintaining measure specifications in hospitals' electronic health record (EHR) systems (88 FR 82167). HOPDs would be required to link their EHR and PACS data to their chosen vendor's translation software to calculate the measure, which we estimate would require no more than 1 hour to complete. In section XXIII.A.9., we estimate that 20 percent of HOPDs will report this measure annually. Because some HOPDs may only elect to report this eCQM for some reporting periods, we are unable to assume that 80 percent of HOPDs will not report this measure in any reporting period. However, for HOPDs who elect not to report this eCQM in any reporting period, the modification will result in a savings of no more than 1 hour and $55 (1 hour x $55.06) as well as any costs that would be associated with implementing and maintaining program requirements specific to this eCQM.

Regarding the remaining policies, we do not believe these policies will result in any additional economic impact beyond those discussed in section “XXIII.A. Collection of Information” of this final rule with comment period.

We did not receive public comments on the financial impact of our proposals. 4. Effects of Changes in Requirements for the Rural Emergency Hospital Quality Reporting (REHQR) Program a. Background

We refer readers to the CY 2025 OPPS/ASC final rule with comment period (89 FR 94562 and 94563) for the previously estimated effects of changes to the REHQR Program for the CY 2025 reporting period and subsequent years. For the CY 2026 reporting period, we have estimated there will be 38 REHs required to report under the REHQR Program based on hospital conversions as of April 11, 2025. We use this number of REHs for our impact analyses knowing that more jurisdictions will pass or amend necessary legislation enabling transitions, acknowledging that the number of conversions could be less than or significantly greater than this estimate with time. b. Impact of CY 2026 OPPS/ASC Final Rule Policies

We are finalizing: (1) removal of the HCHE measure beginning with the CY 2025 reporting period/CY 2027 program determination; (2) removal of the Screening for SDOH measure beginning with the CY 2025 reporting period/CY 2027 program determination; (3) removal of the Screen Positive Rate for SDOH measure beginning with the CY 2025 reporting period/CY 2027 program determination; and (4) adoption of the Emergency Care Access & Timeliness eCQM beginning with the CY 2027 reporting period/CY 2029 program determination as optional in lieu of reporting the chart-abstracted Median Time for Discharged ED Patients. In section XVI.D. of this final rule with comment period, we also updated our ECE policy for the REHQR Program. This update will explicitly include extensions as a type of extraordinary circumstances relief option, in addition to exceptions. Because the process for requesting or granting an ECE will remain the same as the current ECE process, these updates will not affect burden associated with the submission of the ECE form.

We refer readers to section “XXIII.B. Collection of Information” of this final rule with comment period for a detailed discussion of the calculations estimating the changes to the information collection and reporting burden for finalized data requirements under the REHQR Program for the estimated 38 REHs. As shown in summary tables in section XXIII.B.6. of this final rule with comment period, we estimate a total information collection and reporting burden decrease of 14,813 hours at a savings of $380,235 annually associated

with our policies for the CY 2027 reporting period/CY 2029 program determination and subsequent years compared to our currently approved information collection burden estimates under OMB control number 0938- 1454 (expiration date April 30, 2027).

In section XVI.B.1. of this final rule with comment period, we adopted the Emergency Care Access & Timeliness eCQM. Similar to the effects associated with the STEMI eCQM finalized for the Hospital OQR Program in the CY 2022 OPPS/ASC final rule with comment period (86 FR 63984 and 63985), we believe that costs associated with adoption of eCQMs are multifaceted and include not only the burden associated with reporting but also the costs associated with implementing and maintaining program requirements, such as maintaining measure specifications in REHs' EHR systems for the eCQMs used in the REHQR Program. Because REHs will have the option to report the Emergency Care Access & Timeliness eCQM or the more burdensome Median Time for Discharged ED Patients measure, we believe REHs will be positively impacted by the decreased effort required to report the Emergency Care Access & Timeliness eCQM in the long-term following initial implementation in the EHR.

Regarding the remaining policies, we do not believe these policies will result in any additional economic impact beyond those discussed in section “XXIII.B. Collection of Information” of this final rule with comment period.

We did not receive public comments on the financial impact of our proposals. 5. Effects of Changes in Requirements for the Ambulatory Surgical Center Quality Reporting (ASCQR) Program a. Background

We refer readers to the CY 2025 OPPS/ASC final rule with comment period (89 FR 94563) for the previously estimated effects of changes to the ASCQR Program for the CY 2025 reporting period and subsequent years. Based on the most recent analysis of the CY 2025 payment determination data, we found that, of the 6,012 ambulatory surgical centers (ASCs) that were actively billing Medicare, 4,271 were required to participate in the ASCQR Program. Of the 1,741 ASCs not required to participate in the program, 319 ASCs did so and met full requirements. On this basis, we estimate that 4,590 ASCs (4,271 + 319) will submit data for the ASCQR Program for the CY 2026 reporting period and subsequent years unless otherwise noted. We note that this estimate is an increase of 115 ASCs from our estimate of 4,475 provided in the CY 2025 OPPS/ASC final rule with comment period (89 FR 94563) due to more recent data analysis regarding numbers of eligible ASCs. b. Impact of CY 2025 OPPS/ASC Final Rule Policies

We are finalizing: (1) removal of the COVID-19 Vaccination Coverage Among HCP Measure beginning with the CY 2024 reporting period/CY 2026 payment determination; (2) removal of the Facility Commitment to Health Equity (FCHE) measure beginning with the CY 2025 reporting period/CY 2027 payment determination; (3) removal of the Screening for SDOH measure beginning with the CY 2025 reporting period/CY 2027 payment determination; and (4) removal of the Screen Positive Rate for SDOH measure beginning with the CY 2025 reporting period/CY 2027 payment determination.

In section XVII.D. of this final rule with comment period, we also updated our ECE policy for the ASCQR Program. This update will explicitly include extensions as a type of extraordinary circumstances relief option, in addition to exceptions. Because the process for requesting or granting an ECE will remain the same as the current ECE process, these updates will not affect burden associated with the submission of the ECE form.

We refer readers to section “XXIII.C. Collection of Information” of this final rule with comment period for a detailed discussion of the calculations estimating the changes to the information collection and reporting burden for proposed data requirements under the ASCQR Program for the estimated 4,590 program-eligible ASCs. As shown in summary tables in section XXIII.C.7. of this final rule with comment period, we estimate a total information collection and reporting burden decrease of 731,340 hours at a cost of $18,811,786 annually associated with our policies for the CY 2029 reporting period/CY 2031 payment determination and subsequent years compared to our currently approved information collection burden estimates under OMB control number 0938-1270 (expiration date July 31, 2027). We also estimate a decrease of between 36,720 hours at a savings of $2,074,680 and 41,310 hours at a savings of $2,420,766 in information collection burden associated with the removal of the COVID-19 Vaccination Among HCP measure compared to the currently approved information collection burden estimates and under OMB control number 0920-1317 (expiration date January 31, 2028).

We do not believe these policies will result in any additional economic impact beyond those discussed in section “XXIII.C. Collection of Information” of this final rule with comment period.

We did not receive public comments on the financial impact of our proposals. 6. Effects of Requirements for the Overall Hospital Quality Star Rating a. Background

In section XVIII. Overall Hospital Quality Star Rating Modification to Emphasize the Safety of Care Measure Group of this final rule with comment period, we discussed our finalized policies as they relate to the Overall Hospital Quality Star Rating methodology. The Overall Hospital Quality Star Rating uses measures that are publicly reported on the provider comparison tool on Medicare.gov (https://www.medicare.gov/care-compare/) under the public reporting authority of each individual hospital program furnishing measure data. The burden associated with measures included in the Overall Hospital Quality Star Rating, including forms used to request withholding of publicly reported measure data and the Overall Hospital Quality Star Rating (for CAHs), is already captured in respective hospital programs' burden estimates and represents no increased information collection burden to hospitals. b. Impact of CY 2026 OPPS/ASC Proposed Rule Policies

In this CY 2026 OPPS/ASC proposed rule, we are using the most recent data from the Bureau of Labor Statistics, which reflects a median hourly wage of $24.16 per hour for a Medical Records and Health Information Technician professional.\534\ We calculate the cost of overhead, including fringe benefits, at 100 percent of the hourly wage estimate, consistent with the previous year. This is necessarily a rough adjustment, both because fringe benefits and overhead costs vary significantly from employer- to-employer and because methods of estimating these costs vary widely from study-to-study. Therefore, we believe that doubling the hourly wage rate ($24.16 x 2 = $48.32) to estimate total cost is a reasonably accurate estimation method. Accordingly, we calculate the cost burden to hospitals using a wage

plus benefits estimate of $48.32 per hour. We estimate that the non- information collection burden associated with all non-Veterans Health Administration (VHA) hospitals reviewing their Overall Hospital Quality Star Rating preview report prior to public reporting to be 2 hours per hospital, which includes time to review the report and ask any questions about the calculation necessary to increase comprehension. Estimating that approximately 4,600 hospitals would receive an Overall Hospital Quality Star Rating hospital specific report (HSR), regardless of if they meet the reporting thresholds to be assigned a star rating, we estimate the overall non- information collection burden to be $444,544 annually ($48.32 x 2 hours per preview report x once per year x 4,600 hospitals). For CAHs specifically, which are included in the estimate above, we estimate that 1,300 CAHs would be eligible for an Overall Hospital Quality Star Rating, which represents a burden of $125,632 annually (1,300 CAHs x 2 hours per preview report x once per year x $48.32).

\534\ Bureau of Labor Statistics, U.S. Department of Labor, Occupational Outlook Handbook, Medical Records Specialists, at https://www.bls.gov/ooh/healthcare/medical-records-and-health-information-technicians.htm.

Within this rule, for CY 2026 Overall Hospital Quality Star Rating and subsequent years, we finalized our policy to make the following two-stage methodological updates to emphasize the importance of the Safety of Care measure group to the Overall Hospital Quality Star Rating methodology: (1) implement a 4-star cap for poor performance in the Safety of Care measure group (lowest performing quartile) for the 2026 Star Rating, and (2) implement a blanket 1-star reduction for poor performance in the Safety of Care measure group (lowest performing quartile) for the 2027 Star Rating and thereafter.

To simulate the impact of the proposed Overall Hospital Quality Star Rating methodology, we used the July 2024 refresh of the Overall Hospital Quality Star Rating (the most recent publicly released results as of the writing of the proposal) to describe the overall distribution and reclassification of the Overall Hospital Quality Star Rating across different types of hospitals. The update to the Overall Hospital Quality Star Rating methodology in CY 2026 that will limit hospitals in the lowest quartile of Safety of Care (based on at least three measure scores) to a maximum of 4 out of 5 stars (Stage 1 methodological change) would have resulted in 14 (0.30 percent) hospitals receiving a lower Overall Hospital Quality Star Rating in the July 2024 simulation. The update to the Overall Hospital Quality Star Rating methodology beginning in CY 2027 that will reduce the Overall Hospital Quality Star Rating of any hospital in the lowest quartile of Safety of Care (based on at least three measure scores) by 1 star, to a minimum 1-star rating (Stage 2 methodological change) would have resulted in 459 (9.90 percent) hospitals receiving a lower Overall Hospital Quality Star Rating (in the simulation).

Utilizing the Stage 1 methodology update, fewer hospitals would have received a different Overall Hospital Quality Star Rating and changes in the Overall Hospital Quality Star Rating are less easily attributed to specific hospital characteristics, as very few hospitals of any type would be affected. In contrast, the Stage 2 methodological update resulted in teaching hospitals, non-safety-net hospitals, VHA hospitals, non-CAHs, large hospitals (100+ beds), and non-specialty hospitals being more likely to receive a lower Overall Hospital Quality Star Rating in the July 2024 simulation. (Table 173). BILLING CODE 4120-01-P

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BILLING CODE 4120-01-C

In section XX. of this final rule with comment period we are finalizing the adoption of a market-based methodology for determining the MS-DRG relative weights beginning in FY 2029 utilizing the median payer-specific negotiated charge information we will be collecting on the cost report. More specifically, the Medicare cost report will collect the median of the payer-specific negotiated charge that the hospital has negotiated with all of its MAOs, by MS-DRG, effective for cost reporting periods ending on or after January 1, 2026.

We note that the estimated total annual burden hours for this final policy are as follows: 3,038 hospitals times 20 hours per hospital equals 60,760 annual burden hours and $4,857,458.20. We refer readers to section XXIII.E. of this final rule with comment period for further analysis of this assessment.

Under the finalized methodology, we will apply a budget neutrality factor to ensure that the overall payment impact of any MS-DRG relative weight changes is budget neutral, as required by section 1886(d)(4)(C)(iii) of the Act and consistent with our current practice.

As discussed in the CY 2026 OPPS/ASC proposed rule, similar to our discussion in the economic analysis section of the FY 2021 IPPS/LTCH PPS final rule (85 FR 59089 through 59090) regarding the market-based MS-DRG relative weight methodology, once we have access to the weighted payer-specific negotiated charge information at the MS-DRG level from the cost reports we would be able to more precisely estimate the payment impact of adopting this market-based MS-DRG relative weight methodology for payments beginning in FY 2029. We also stated that we intended to provide these more precise estimates prior to the FY 2029 effective date. However, to explore the potential impacts more generally, in the CY 2026 OPPS/ASC proposed rule we explained that we conducted a literature search to compare the payment rates of Medicare FFS, MA organizations, and other commercial payers, which is discussed in section XX.B. of this final rule with comment period. As discussed in that section, the payer-specific charges negotiated between hospitals and MAOs are generally well-correlated with Medicare IPPS payment rates, although in the future this may change over time for some services. As discussed in response to comments on the impacts in section XX.C.3. of this final rule with comment period, we continue to believe that if market-based data (median payer-specific negotiated charges for MA organizations) are incorporated into the calculation of the MS-DRG relative weights, initially there will be limited impact on the relative weights given the current similarity between MA organization rates and Medicare FFS rates. To the extent the data shows that there would be more than a limited impact on the relative weights initially, which we do not believe will be the case, we intend to provide an opportunity for the public to review the data we collect prior to implementation. This will allow for additional discussions, public review, and feedback on utilizing this market-based data in the MS-DRG relative weight methodology. We will continue to provide impact analyses of changes in the MS-DRG relative weights in the annual IPPS rulemaking. Also, as discussed in the CY 2026 OPPS/ASC proposed rule we expect for some period of time following implementation of this market- based MS-DRG relative weight methodology to continue to estimate and publicly provide the MS-DRG relative weights calculated using the current methodology for informational purposes.

As previously noted, once we have access to the payer-specific negotiated charge information at the MS-DRG level, we can more precisely estimate the potential payment impact, which we intend to do in future rulemaking, prior to the FY 2029 effective date of the market-based MS-DRG relative weight methodology. As under the current methodology, the impact of any MS- DRG relative weight changes on an individual hospital would depend on the mix of services provided by that particular hospital. 8. Graduate Medical Education Accreditation

In section XXI. of this final rule with comment period, we are finalizing, with modification, our proposal that accreditors may not require as part of accreditation or otherwise encourage institutions to put in place diversity, equity, and inclusion programs that encourage unlawful discrimination on the basis of race or other violations of Federal law. Specifically, we are changing the definition of “approved medical residency program” and equivalent terms in the regulations to state that accrediting organizations may not use accreditation criteria that promote or encourage discrimination on the basis of race, color, national origin, sex, age, disability, or religion, including the use of those characteristics or intentional proxies for those characteristics as a selection criterion for employment, program participation, resource allocation, or similar activities, opportunities, or benefits. The effective date of this policy is January 1, 2026. We believe there is no financial impact associated with this policy because, as of January 1, 2026, we do not expect that current or future accrediting organizations would continue to or newly require or otherwise encourage institutions to put in place diversity, equity, and inclusion programs that encourage unlawful discrimination on the basis of race or other violations of Federal law. 9. Effects Relating to Hospital Price Transparency a. Background

Since the January 1, 2021, effective date of the CY 2020 Hospital Price Transparency (HPT) final rule, hospitals have been required to make their standard charges available to the public. Consistent with Executive Order 14221, and to further advance the goals articulated in previous HPT rulemaking of requiring hospitals to make meaningful price information available to consumers, employers, policymakers, and others to support a more competitive, innovative, and affordable healthcare system, we proposed several updates to the HPT regulations in the CY 2026 OPPS/ASC proposed rule to enhance the clarity and standardization of hospital disclosure of standard charges. We are finalizing with modifications revisions to Sec. 180.20 to add definitions for “tenth (10th) percentile allowed amount”, “median allowed amount”, and “ninetieth (90th) percentile allowed amount,” which are values a hospital will encode when a payer-specific negotiated charge is based on a percentage or algorithm, to more accurately reflect the distribution of actual amounts that a hospital has received for an item or service. In tandem with that, we are finalizing revisions to Sec. 180.50 to remove the requirement for hospitals to disclose the estimated allowed amount, and, instead, require hospitals to disclose the 10th percentile, median, and 90th percentile allowed amounts, as well as the count of allowed amounts, in MRFs when payer-specific negotiated charges are based on percentages or algorithms. We are also finalizing, with modification, our proposal to require that hospitals use electronic data interchange (EDI) 835 electronic remittance advice (ERA) transaction data or an alternative, equivalent source of remittance data to

calculate and encode the allowed amounts. We are finalizing our proposals, with some modifications, to require that hospitals comply with specific instructions regarding the methodology, including a lookback period, that must be used to calculate those amounts.

Additionally, we are finalizing with modifications our proposed revisions to Sec. 180.50 to require hospitals to attest that in the MRF, to the best of the hospital's knowledge and belief, the hospital has included all applicable standard charge information in accordance with the requirements of this section and the information encoded is true, accurate, and complete as of the date in the file. We are finalizing our proposal that hospitals attest in the MRF that the hospital has included all applicable payer-specific negotiated charges as dollars that can be expressed as a dollar amount, and for payer- specific negotiated charges that are not knowable in advance or cannot be expressed as a dollar amount, the hospital has provided in the MRF all necessary information available to the hospital for the public to be able to derive a dollar amount, including, but not limited to, the specific fee schedule or components referenced in such percentage, algorithm, or formula. Furthermore, we are finalizing our proposal that hospitals encode in the MRF the name of the hospital chief executive officer, president, or senior official designated to oversee the encoding of true, accurate, and complete data. In addition, to advance the comparability of HPT data with other healthcare data, we are finalizing our proposal to require that hospitals encode their organizational, or Type 2, National Provider Identifier(s) (NPIs) in the MRFs.

Finally, to encourage faster resolution and payment of CMPs, and in exchange for a hospital's admission of having violated HPT requirements, we are finalizing our proposal with clarifying edits to update Sec. 180.90 to reduce the amount of a CMP by 35 percent, under certain conditions, when a hospital waives its right to an ALJ hearing. These changes aim to improve transparency in hospital pricing, facilitate efficient enforcement of the HPT requirements, and empower consumers with actionable pricing information.

We are finalizing an effective date of January 1, 2026, for the revisions at Sec. 180.50, including removal of the estimated allowed amount, disclosure of the 10th percentile, median, 90th percentile allowed amounts and the count of allowed amounts, the attestation requirements, and inclusion of NPIs. However, we will delay enforcement of these finalized policies until April 1, 2026. We are finalizing at new Sec. 180.90(c)(4) that, effective beginning January 1, 2026, the amount of a CMP would be reduced by 35 percent should a hospital submit to CMS a written notice requesting to waive its right to a hearing under Sec. 180.100 within 30 calendar days of the date of the notice of imposition of the CMP. b. Overall Estimated Burden on Hospitals Due to HPT Requirements

To analyze the costs of the requirements, we used an updated baseline that assumes the existing requirements (those adopted in the CY 2020 HPT final rule, the CY 2022 OPPS/ASC final rule with comment period and the CY 2024 OPPS/ASC final rule with comment period and still codified at 45 CFR part 180) remain in place over the time horizon of this RIA.

In the CY 2024 OPPS/ASC final rule with comment period, we estimated an ongoing annual national burden of 383,292 hours (54 hours x 7,098 hospitals) and an annual national cost of $32,370,571 dollars ($4,560.52 per respondent x 7,098 hospitals), which represented a $10,698,069 ($32,370,571-$21,672,502) increase over our previous estimated ongoing national annual burden for subsequent years for hospitals to update their standard charge information in the CMS standard template and conform to the data dictionary.

We indicated in the CY 2026 OPPS/ASC proposed rule, we believe hospitals would incur an initial one-time cost to update their processes and systems to (1) identify and collect the newly proposed data elements, and (2) encode the standard charge information for the newly proposed data elements in the CMS standard template. To implement the proposed requirements, we estimated that it would take a Business Operations Specialist (BLS 13-1000), on average, 4 hours (at a cost of $87.52 per hour) to develop and update the necessary processes and procedures and develop the requirements to implement the proposed data elements and a General and Operations Managers (BLS 11-1021), on average, 1 hours (at a cost of $128.00 per hour) to review the updates.

Therefore, we stated in the CY 2026 OPPS/ASC proposed rule that we believed the one-time burden estimate to be 37,080 hours for all hospitals (5 hours x 7,416 hospitals) at a cost of $3,545,441.28 (7,416 hospitals x [($87.52 x 4 hours) + ($128.00 x 1 hours)]); see Table 163. As we indicated in the CY 2026 OPPS/ASC proposed rule, we believe the benefits to users of the MRF of having this additional information would justify the initial one-time burden to hospitals to update their processes and systems to identify and collect the newly proposed data elements and encode the standard charge information for the newly proposed data elements in the CMS standard template.

For this final rule with comment period, we updated the number of hospitals estimated to be subject to the HPT requirements using the same methodology as we did in the CY 2024 OPPS/ASC final rule with comment period. There were 8,340 hospitals most recently identified in the HIFLD hospital dataset.\535\ We subtracted 374 hospitals HIFLD identified as “closed” as well as hospitals that are deemed under the regulation to have met requirements which included 352 Federally owned non-military and military hospitals, and 198 State, local, and district run forensic hospitals. We therefore estimate that, for this final rule with comment period, 7,416 hospitals would meet the HPT regulation's definition of “hospital” at 45 CFR 180.20.

\535\ HIFLD Open was discontinued on August 26, 2025. This information is now accessible via the Geospatial Information Infrastructure (GII).

After consideration of public comments, we are increasing both our one-time and ongoing annual burden estimates as demonstrated in section “XXIII. Collection of Information”. To establish processes and requirements related to the new data elements we are finalizing in this final rule with comment period, we now estimate that it will take a Business Operations Specialist (BLS 13-1000), on average, 8 hours (at a cost of $87.52 per hour) to develop and update the necessary processes and procedures and develop the requirements to implement the proposed data elements, a General and Operations Managers (BLS 11-1021), on average, 2 hours (at a cost of $128.00 per hour) to review the updates, and a Chief Executive (BLS 11-1011) 2 hours (at a cost of $252.82) to review and attest to the accuracy and completeness of the data in the MRF. We added the labor category for Chief Executives in response to comments on the CY 2026 OPPS/ASC proposed rule, addressed in an earlier section of this final rule with comment period, that suggested we failed to account for the burden for the Chief Executive Officer, president, or senior official designated to oversee the encoding of true, accurate, and complete data in the MRF to review and attest to

the information. Therefore, we believe the one-time burden estimate to implement the new requirements finalized in this final rule with comment period to be 88,992 hours for all hospitals (12 hours x 7,416 hospitals) at a cost of $10,840,708.80 (7,416 hospitals x [($87.52 x 8 hours) + ($128.00 x 2 hours) + ($252.82 x 2 hours]). For the annual burden, we added the labor category for Chief Executives in response to comments on the CY 2026 OPPS/ASC proposed rule, and we now estimate a total of 415,296 hours for all hospitals (7,416 hospitals x 56 hours) at a cost of $40,269,176.60 (7,416 hospitals x [($128/hour x 2 hours) + ($87.52/hour x 40 hours) + ($97.30/hour x 12 hours) + ($252.82/hour x 2 hours]), to include the burden for the senior hospital official. The annual burden is increased by 2 hours from 54 hours to 56 hours per hospital as compared to the CY 2024 OPPS/ASC final rule with comment period, which reflects the additional burden annually associated with the new requirements finalized in this final rule with comment period. c. Benefit of Policies

As indicated in the CY 2026 OPPS/ASC proposed rule (90 FR 33856), although we cannot quantify the benefits of including additional data elements and encoding such data in the CMS required MRF template, we believe any opportunity to provide further context about standard charges, including through the addition of contextual information when the payer-specific negotiated charge is based on a percentage or algorithm, will be helpful to all consumers of the MRF as they analyze the data to identify cost savings and ways to stimulate market competition. We believe the attestation statement we are finalizing and the requirement to add the name of a senior official to publicly attest to the accuracy and completeness of the data encoded within the file will reduce public confusion related to whether all standard charges for hospital items and services are included within the MRF as dollar amounts, if possible, and the hospital has provided all necessary information available to the hospital for the public to be able to derive the dollar amount, including, but not limited to, the specific fee schedule or components referenced in such percentage, algorithm or formula. We also believe the addition of the NPI data element will catalyze more fulsome HPT and Transparency in Coverage (TiC) analysis. (1) Benefits to Hospitals

As indicated in the CY 2026 OPPS/ASC proposed rule (90 FR 33856), hospitals, either directly or through management or actuarial consultants, are consuming the data released in the MRFs for their own operational purposes. Hospitals consume and analyze MRF data to improve negotiation strategies with employers and third party payers, improve contracting strategies, and demonstrate value in the negotiation process.\536\ \537\ Hospitals also use the MRF data to determine pricing strategies and to identify and hone their competitive advantage,\538\ as well as to improve their revenue cycle efficiency.\539\ Further, we continue to believe, as indicated in the CY 2026 OPPS/ASC proposed rule that, for those hospitals that are assessed a CMP, the reduction of the CMP we are finalizing if the hospital elects not to appeal CMS' findings, would offset some of the hospital financial burden, including legal fees and costs associated with challenging the imposition--including requesting and defending a hearing before an Administrative Law Judge (ALJ) and any subsequent appeals.

\536\ Clarify Insights Center. (2023, August 15). How hospitals can use price transparency data to negotiate better contracts with payers. Retrieved from https://clarifyhealth.com/insights/blog/how-hospitals-can-use-price-transparency-data-to-negotiate-better-contracts-with-payers/.

\537\ Gomes, C. (2023, July 31). Why healthcare providers should harness price transparency data. Medlyze--Price Transparency Data and Analysis for the Healthcare Industry Insights. Retrieved from https://www.medlyze.com/blog/why-healthcare-providers-should-harness-the-power-of-price-transparency-data.

\538\ Xiao, F. (2024, October 25). Is price transparency helping? Here are three ways to tell: Let's explore our biggest indicators of change: competition, pricing, and power. Turquoise Health Blog. Retrieved from https://blog.turquoise.health/is-price-transparency-helping-heres-three-ways-to-tell/.

\539\ Healthcare Financial Management Association. (2023, August 28). Leverage healthcare price transparency data to promote financial sustainability. Retrieved from https://www.hfma.org/price-transparency/leverage-healthcare-price-transparency-data-to-promote-financial-sustainability/.

(2) Benefits to Other Interested Parties

As discussed in the CY 2020 HPT final rule (84 FR 65538) and the CY 2026 OPPS/ASC proposed rule (90 FR 33856), we believe public access to hospital standard charge information can be useful to the public, including patients who need to obtain services from a hospital, consumers of healthcare who wish to view hospital standard charge information prior to selecting a hospital, employers and State governments searching for lower cost options for health care coverage, and other users of the MRF who may develop consumer-friendly price transparency tools or perform price analyses to uncover disparities or drive value-based policy development. Since the effective date of the HPT regulations, innovators have been compiling HPT data sets and making them available for employers, researchers, and journalists to perform cost comparison studies and publish findings.

As discussed in the CY 2026 OPPS/ASC proposed rule (90 FR 33856 through 33857), feedback from interested parties, specifically innovators and researchers, has illuminated the need to detangle complex hospital contracting methods through the provision of data elements that help define the algorithm or percentage set forth in hospital MRFs. The allowed amount data elements we are finalizing in this final rule with comment period will support a better understanding of the range of payer-specific negotiated charge dispersion, which would further assist employers and consumers to understand a hospital's value as compared to other hospitals, stimulating competition and potentially resulting in price convergence to drive more predictable and consistent health care costs.\540\

\540\ Xiao, F. (2024, October 25). Is price transparency helping? Here are three ways to tell. Turquoise Health. Retrieved from https://blog.turquoise.health/is-price-transparency-helping-heres-three-ways-to-tell/.

With regard to the proposals we are finalizing in this final rule with comment period to strengthen the affirmation statement requirement, beginning January 1, 2026, by replacing it with an attestation in the MRF that would contain new specifications (relative to existing affirmation requirements) and to require hospitals to encode the name of the chief executive officer, president or senior official designated to oversee the encoding of true, accurate and complete data in the MRF, we continue to believe they will provide the necessary reassurance that hospitals have provided in their MRFs meaningful, accurate information to users of the MRF about their standard charges for health care items and services.

With regard to the NPI data element, as indicated in the CY 2026 OPPS/ASC proposed rule (90 FR 33857), including identifiers used for financial transactions in the MRF will make it easier for key participants in price negotiations (for example, employers and payers) to programmatically identify hospitals in their internal financial databases, such as claims data,

to conduct more in-depth payment and volume analyses to support contract negotiations and potentially reduce healthcare costs for consumers. We believe requiring a standard identifier will also help CMS, researchers, and innovators reduce dependence on manual processes for identifying the hospital and the hospital locations and increase opportunities for automated processes. d. Limitations of Our Analysis

As stated in the CY 2024 OPPS/ASC final rule with comment period (88 FR 82174) and the CY 2026 OPPS/ASC proposed rule (90 FR 33857), it would be difficult for us to conduct a detailed quantitative analysis of the impact of requiring hospitals to make HPT information publicly available, given the lack of studies at the national level on the impact of the HPT regulations. Thus, in assessing the impact of our proposals, we rely on qualitative evidence of, and experiences with, the use of the public HPT data and feedback from consumers of the MRFs, as well as our own experiences reviewing the MRFs. Specifically, as discussed in the CY 2026 OPPS/ASC proposed rule, we have noted through our own reviews that many hospital MRFs lack dollar values when the standard charge for an item or service is based on an algorithm or percentage and have heard from interested parties the limitations of drawing meaningful comparisons without necessary context to help understand the standard charge in dollars for such items or services. We also have received comments from MRF users since the effective date of the 2024 OPPS/ASC final rule with comment period indicating that requiring hospitals to make a good faith effort did not go far enough to convey CMS' intent that all standard charge information available must be encoded in the MRF, with commenters suggesting our requirement to allow a good faith estimate may actually deter hospitals from providing fully complete and accurate standard charge data in their MRF. As we indicated in the proposed rule, we also heard users of the MRFs who questioned a hospital's inability to encode dollar amounts for the payer-specific negotiated charge data elements, and whether the complex contracting methodologies used by hospitals and payer organizations could only be expressed through an algorithm or formula, and not a dollar amount. We noted that we understand that users of the MRF may find the addition of algorithms make price comparisons among hospitals challenging when only an algorithm is available because the algorithms may not be consumer friendly. We continue to believe that our proposal to require an attestation, as opposed to merely requiring an affirmation statement, may enhance users' confidence that the data encoded is accurate and complete.

In addition, as indicated in the CY 2026 OPPS/ASC proposed rule (90 FR 33857), in discussions with innovators and researchers, we have heard that the addition of an NPI as a hospital unique identifier would allow more effective data crosswalking between hospital HPT MRFs and TiC MRFs, as well as to other CMS datasets that contain hospital quality data. We continue to believe this regulation would provide the additional context needed for consumers of the MRFs to create meaningful dollar comparisons that would ultimately benefit consumers through development of cost comparison tools, increased competition, or improved price negotiations with employers. e. Alternatives Considered

The revisions to the HPT regulations we are finalizing in this final rule with comment period are designed to further address some of the barriers identified that limit price transparency, with a goal of increasing competition among healthcare providers to bring down costs. Specifically, this final rule with comment period aims to make meaningful price information via hospital standard charges more readily available to the public by providing additional contextual information, displayed as a dollar value, in those instances where standard charges are based on a percentage or an algorithm, as well as provide needed hospital identifier values to enable innovators and researchers to combine the HPT data with other claims and quality data to further empower consumer decision-making. We considered several alternative approaches, including other methodologies and lookback periods for calculating the allowed amount data elements, and whether to display specific counts of allowed amounts or ranges. We discuss these alternatives in section XIX. of this final rule with comment period. Specifically, we considered EDI 835 ERA transaction data lookback period alternatives of 3 months, 6 months, as well as requiring hospitals to use a rolling 12-month period prior to when the MRF posted. Based on comments received, we are ultimately finalizing a lookback period of no less than 12 months and no longer than 15 months. We sought comment on data sources other than the EDI 835 ERA transaction data to use to derive the allowed amount data elements. We received comments that not all hospitals have access to the EDI 835 ERA data for every item and service and that some payers provide paper or alternative electronic sources of remittance data. Based on comments, we are finalizing that hospitals use EDI 835 ERA transaction data or an alternative, equivalent source of remittance data to calculate and encode the allowed amounts. We also considered whether hospitals could encode a range of allowed amounts, as opposed to the exact count of allowed amounts, to achieve our objective of providing needed context to the allowed amount data element values. We received one comment indicating that adopting a range would be more burdensome than encoding the exact amount and are thus finalizing that hospitals must encode the count of allowed amounts.

We considered several alternative options to updating the required affirmation within the MRF, as discussed in section XIX. of this final rule with comment period. We considered asking the official to submit their MRF attestation directly to CMS, using a CMS developed template that would provide evidence of the accuracy and completeness of the MRF, and we also considered requiring the hospitals to post a more detailed attestation document that is signed by a senior official on the publicly available website that hosts the MRF. However, after consideration of public comments, we continue to believe these alternatives to be less useful than our proposals as they would either not meet the stated need to alert the public to the hospital's declaration of the accuracy and completeness of the data encoded within the MRF, or the attestation would not “travel” inside the MRF like the affirmation statement.

In addition, we considered different types of hospital identifiers, specifically the Employer Identification Number and the CMS Certification Number. Ultimately, however, we continue to believe that the alternatives would either limit the usefulness of hospital standard charge information or increase burden for hospitals without any additional benefit for users of MRF standard charge information.

Comment: Many commenters expressed concern about the financial and administrative burden for hospitals to comply with the proposed hospital price transparency requirements. Several commenters commented on the alternatives to our proposals outlined earlier in this section and section XIX. (Updates to Requirements for Hospitals to Make Public a List of Their Standard Charges section) that we considered.

Response: We refer readers to the more substantial discussion of these comments and our responses to these comments in section XIX. (Updates to Requirements for Hospitals to Make Public a List of Their Standard Charges section) and section “XXIII. Collection of Information”. After consideration of the public comments, we are finalizing with modifications our proposals and our burden estimates.

Due to the uncertainty involved with accurately quantifying the number of entities that will review the rule, we assume that the total number of unique commenters on this year's proposed rule will be the number of reviewers of this final rule with comment period. We acknowledge that this assumption may understate or overstate the costs of reviewing this rule. It is possible that not all commenters reviewed this year's rule in detail, and it is also possible that some reviewers chose not to comment on the proposed rule. For these reasons we believe that the number of past commenters would be a fair estimate of the number of reviewers of this rule. We welcomed any public comments on the approach in estimating the number of entities that would review the proposed rule. We did not receive any public comments specific to our solicitation.

We also recognize that different types of entities are in many cases affected by mutually exclusive sections of this final rule with comment period, and therefore for the purposes of our estimate we assume that each reviewer reads approximately 50 percent of the rule. We sought comments on this assumption. We did not receive any public comments specific to our solicitation.

Using the wage information from the Bureau of Labor Statistics (BLS) for medical and health service managers (Code 11-9111), we estimate that the cost of reviewing this rule is $113.42 per hour, including overhead and fringe benefits (https://www.bls.gov/oes/current/oes_nat.htm). Assuming an average reading speed, we estimate that it would take approximately 8 hours for the staff to review half of this final rule with comment period. For each entity that reviews the rule, the estimated cost is $907.36 (8 hours x $113.42). Therefore, we estimate that the total cost of reviewing this regulation is $2,760,189 ($907.36 x 3,042).

The RFA requires agencies to analyze options for regulatory relief of small entities, if a rule has a significant impact on a substantial number of small entities. For purposes of the RFA, we estimate that many hospitals and CAHs are considered small businesses either by the Small Business Administration's size standards with total revenues of $41.5 million or less in any single year or by the hospital's not-for- profit status. Most ASCs and most CMHCs are considered small businesses with total revenues of $16.5 million or less in any single year. While we note the limited availability of certain information for OPPS providers, we estimate that approximately 3,000 OPPS providers included in the impact analysis would be considered small entities. As the small entity category would represent the majority of the providers in the table, the individual impact table categories would provide more specific estimated hospital impacts. While the estimated impacts of this final rule with comment period vary by OPPS provider category, many of those categories will be within the range of 1.5 to 2.5 percent. For details, we refer readers to the Small Business Administration's “Table of Size Standards” at http://www.sba.gov/content/small-business-size-standards.

Individuals and States are not included in the definition of a small entity. As its measure of significant economic impact on a substantial number of small entities, HHS uses a change in revenue of more than 3 to 5 percent. We believe that this threshold will not be reached by the requirements in this final rule with comment period, since as noted earlier in this section, most estimated changes will be below that range. Therefore, the Secretary has certified that this final rule with comment period will not have a significant economic impact on a substantial number of small entities.

In addition, section 1102(b) of the Act requires us to prepare a regulatory impact analysis if a rule may have a significant impact on the operations of a substantial number of small rural hospitals. This analysis must conform to the provisions of section 604 of the RFA. For purposes of section 1102(b) of the Act, we define a small rural hospital as a hospital that is located outside of a metropolitan statistical area and has 100 or fewer beds. We estimate that this final rule with comment period will increase payments to small rural hospitals by approximately 2.4 percent; therefore, it should have a negligible impact on approximately 526 small rural hospitals. We note that the estimated payment impact for any category of small entity will depend on both the services that they provide as well as the payment policies and/or payment systems that may apply to them. Therefore, the most applicable estimated impact may be based on the specialty, provider type, or payment system.

The analysis above, together with the remainder of this preamble, provides a regulatory flexibility analysis and a regulatory impact analysis.

Executive Order 13132 establishes certain requirements that an agency must meet when it promulgates a proposed rule (and subsequent final rule) that imposes substantial direct requirement costs on State and local governments, preempts State law, or otherwise has Federalism implications. We have examined the OPPS and ASC provisions included in this final rule with comment period in accordance with Executive Order 13132, Federalism, and have determined that they will not have a substantial direct effect on State, local, or tribal governments, preempt State law, or otherwise have a federalism implication. As reflected in Table 166 of this final rule with comment period, we estimate that OPPS payments to governmental hospitals (including State and local governmental hospitals) will increase by 2.1 percent under this final rule with comment period. While we do not know the number of ASCs or CMHCs with government ownership, we anticipate that it is small. The analyses we have provided in this section of this final rule with comment period, in conjunction with the remainder of this document, demonstrate that this rule is consistent with the regulatory philosophy and principles identified in Executive Order 12866, the RFA, and section 1102(b) of the Act.

This final rule with comment period will affect payments to a substantial number of small rural hospitals and a small number of rural ASCs, as well as other classes of hospitals, CMHCs, and ASCs, and some effects may be

significant. However, as noted in section XXVI. of this final rule with comment period, this rule should not have a significant effect on small rural hospitals.

In the absence of an appropriation for FY 2026 or a Continuing Resolution, the Federal government funding for HHS lapsed on October 1, 2025. During this funding lapse, only excepted or exempt operations have continued, which significantly delayed work on this final rule with comment period. CMS identified funding that allowed the agency to restore additional day-to-day operations on a temporary basis beginning on October 27, 2025. However, most of the work on this final rule with comment period was not completed in accordance with our usual schedule for final CY OPPS/ASC payment rules, which aims for an issuance date of November 1, followed by an effective date of January 1, to ensure that the policies are effective at the start of the calendar year to which they apply.

We ordinarily provide a 60-day delay in the effective date of final rules after the date they are issued. The 60-day delay in effective date required by the Congressional Review Act, 5 U.S.C. 801(a)(3), can be waived, however, if the agency finds, for good cause, that notice and public procedure thereon are impracticable, unnecessary, or contrary to the public interest, and the agency incorporates the finding and a brief statement of reasons in the rule issued, 5 U.S.C. 808(2). We believe it would be impracticable and contrary to the public interest to delay the effective date of the OPPS and ASC final rule with comment period for the following reasons.

If the effective date of this final rule with comment period mentioned above in this document is delayed by 60 days, the finalized OPPS and ASC payment system updated policies (including the Hospital Outpatient Quality Report (OQR) Program, Rural Emergency Hospital Quality Reporting (REHQR) Program, the Ambulatory Surgical Center Quality Reporting (ASCQR) Program, Overall Hospital Quality Star Rating, the Hospital Price Transparency, Medicare Severity Diagnostis Related Groups (MS-DRGs), and Graduate Medical Education (GME) policies will not be effective as of the beginning of the payment year, and CMS will be compelled to continue to use obsolete reimbursement rates which will disadvantage health care providers and suppliers. We note that our waiver of the delayed effective date only applies to the OPPS and ASC payment system policies that are adopted in this final rule with comment period.

In accordance with sections 1833(t)(9) and 1833(i)(2)(D) of the Act, the OPPS and the ASC payment systems are calendar year payment systems. We typically issue the OPPS/ASC final rule with comment period by November 1 of each year to both comply with the statutory requirement under section 1833(t)(9)(A) of the Act to annually review and update these payment systems on a calendar year basis and ensure 60-days' notice so that the payment policies for these systems are effective on January 1, the first day of the calendar year to which the policies are intended to apply. The Hospital OQR Program, REHQR Program, and the ASCQR Program are intended to align with the OPPS and the ASC payment systems, respectively.

In this final rule with comment period, we review and revise payment rates for specific services and adopt or revise other policies that relate to the OPPS/ASC payment system for CY 2026. Section 1833(t)(9)(A) of the Act requires that no less often than annually, the Secretary shall review and revise the groups, the relative payment weights, and the wage and other adjustments for outpatient services to take into account changes in medical practice, changes in technology, the addition of new services, new cost data, and other relevant information and factors. In addition, section 1833(i)(2)(A) of the Act states that the payment amount made for facility services furnished in connection with a surgical procedure furnished to an individual in an ambulatory surgical center should be reviewed and updated annually to take account of varying conditions in different areas.

We find that, in order to comply with the statutory requirements to annually review and update these payment systems and ensure that the payment policies for these systems are effective on an annual basis, we must ensure that the rule is effective no later than 1 full year after the effective date of the previous year's update (that is, January 1 of each year). Moreover, it is in the public interest to waive the 60-day delay of the effective date, so that providers, and suppliers are adequately reimbursed starting at the beginning of the calendar year.

Therefore, we find good cause exists to waive the 60-day delay in the effective date for this final rule with comment period.

Mehmet Oz, Administrator of the Centers for Medicare & Medicaid Services, approved this document on November 20, 2025.