The authors submitted the comment letter to the Centers on Medicare and Medicaid Services on September 15, 2025. This version was edited on September 23, 2025, to add a description of the types of services the Medicare Payment Advisory Commission discussed equalizing payment for.
The Centers for Medicare and Medicaid Services (CMS) recently issued the Calendar Year 2026 Hospital Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center Payment System proposed rule. Loren Adler and Matthew Fiedler submitted a comment letter that makes three main points about the proposed rule:
- CMS’ proposal to apply site-neutral payment to drug administration services furnished in currently excepted off-campus hospital outpatient departments would lower costs for the Medicare program and its beneficiaries, remove an incentive for vertical consolidation, and do so without harming patient care.
- The economic logic of site-neutral payment applies to many other types of services and to on-campus, not just off-campus, services. Thus, further expanding site-neutral payment, as CMS seeks comment on in the proposed rule, would likely produce similar benefits.
- To truly equalize payments across sites of service, CMS would need to set “site-neutral” payment rates that more precisely align with the payments that would occur under the Physician Fee Schedule, rather than simply paying 40 percent of the OPPS rate.
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Commentary
Comments on site-neutral payment provisions of CMS’ proposed OPPS rule
September 23, 2025