CMS recently proposed a series of payment updates across multiple care settings for fiscal year 2026.
ASCs are impacted directly, but the changes could affect care delivery dynamics. Here are 10 things to know:
1. CMS proposed a 2.4% payment increase for inpatient hospitals, translating to a $4 billion funding surge. The proposed 2.4% pay bump includes a 3.2% market basket update offset by a 0.8% productivity cut, consistent with statutory formulas. Long-term care hospitals and inpatient psychiatric facilities are also poised for increases, signaling a federal investment in acute and behavioral care settings.
National hospital groups are concerned that the proposed update fails to meaningfully address the real cost pressures hospitals face, particularly in rural and underserved areas still reeling from pandemic-era inflation and workforce shortages.
2. Skilled nursing facilities are in line for a 2.8% payment bump, but performance-based payment reductions are expected to subtract nearly $196.5 million in 2025 — with more to come.
3. The low wage index hospital policy will be discontinued in 2026, following a court ruling. A transitional buffer is proposed, but rural and lower-wage hospitals may see tighter margins.
4. CMS plans to remove social determinants of health items — such as food, utilities, and living situation — from SNF, inpatient rehabilitation facilities and other quality reporting programs.
5. Inpatient psychiatric facilities are set to receive a 2.4% increase, equating to $70 million in additional payments. CMS also aims to update quality measures and explore star ratings for these facilities.
6. Hospices will receive a 2.4% increase, boosting payments by $695 million. However, providers not meeting quality metrics will see a 4-point penalty.
7. Inpatient rehabilitation facilities are lined up for a $295 million payment increase, but COVID-19-related quality measures are being removed due to data burden.
8. Across settings, CMS is requesting input on Fast Healthcare Interoperability Resources standards, digital reporting and interoperability improvements.
9. CMS is looking to incorporate measures around well-being, nutrition and health equity across facility types.
10. Stakeholders have 60 days to submit public comments on CMS’ proposed changes. While ASCs are not the primary focus, their alignment with hospitals and post-acute care providers means advocacy now could shape future outpatient policy.
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