CY 2026 OPPS and ASC Final Rule: Payment Update and Billing Changes
CMS issued the CY 2026 hospital outpatient (OPPS) and ASC final rule with comment period (CMS-1834-FC) on November 21, 2025, and the Federal Register published it on November 25, 2025. It sets Medicare outpatient facility payment for 2026, with a 2.6 percent update and a $91.415 conversion factor.
Written by Salman Saeed, CEO and Co-Founder · Reviewed by a Certified Medical Coder · 
In short: CMS-1834-FC (90 FR 53448) took effect January 1, 2026. It updates OPPS and ASC rates by 2.6 percent, cuts drug administration payment at excepted off-campus departments and starts the Inpatient Only list phase-out.
What Did CMS Publish, and When Does It Apply?
CMS issued the final rule on November 21, 2025, and the Federal Register published it on November 25, 2025 at 90 FR 53448. The document is the Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems final rule (CMS-1834-FC, RIN 0938-AV51).
The provisions are effective January 1, 2026, so this rule sets 2026 payment for hospital outpatient departments and ambulatory surgical centers. The Federal Register notice invited comments until January 20, 2026. How the payment system itself works is on the OPPS and APCs rule page and in how OPPS and APCs pay outpatient claims.
What Changed for Billing in 2026?
| Change | What the rule says | Applies from |
|---|---|---|
| Payment update | OPPS rates rise 2.6 percent for hospitals that meet quality reporting: a 3.3 percent market basket less a 0.7 percentage point productivity adjustment. ASC rates get the same 2.6 percent. The conversion factor is $91.415, or $89.632 for hospitals that fail the Hospital OQR Program. | January 1, 2026 |
| Drug administration at off-campus departments | Codes in the drug administration APCs are paid at the physician fee schedule equivalent rate at off-campus provider-based departments excepted under section 603 of the Bipartisan Budget Act of 2015. CMS estimates this lowers OPPS spending by $290 million. | CY 2026 |
| Inpatient Only list | Phased out over 3 years, starting with the removal of 285 mostly musculoskeletal procedures. | CY 2026 |
| Two-midnight medical review | The exemption from certain two-midnight medical review activities continues for procedures removed from the Inpatient Only list. | CY 2026 and after |
| Skin substitutes | Products are unpackaged from the application procedures (CPT 15271 to 15278) and paid through APCs by FDA category, at a single rate for CY 2026. | CY 2026 |
| Technetium-99m add-on | A $10 add-on per dose of Tc-99m made from domestically produced Mo-99, reported with new HCPCS code C9176. | January 1, 2026 |
CMS kept the existing 0.5 percent 340B remedy reduction to the conversion factor for non-drug services in CY 2026 and did not finalize the proposed 2 percent. The fact sheet says it expects a larger reduction from CY 2027.
Who Does This Affect?
The fact sheet says the policies affect approximately 4,000 hospitals and approximately 6,000 ASCs. Hospital outpatient departments bill on the UB-04, and emergency department groups bill their professional claims separately under the fee schedule.
The drug administration change is aimed at excepted off-campus departments, so health systems that run them should look there first.
What Should Billing Teams Do Now?
- Confirm your 2026 rates use the $91.415 conversion factor, or $89.632 if the hospital failed the OQR requirements.
- List drug administration claims from off-campus provider-based departments and compare the 2026 payments with the physician fee schedule equivalent rate.
- Check the 285 removed procedures against your surgical schedule. A procedure no longer on the Inpatient Only list can be paid as outpatient when clinically appropriate.
- Rework skin substitute claims so the product and the application procedure each follow their own APC.
- Add C9176 to the charge description master for qualifying Tc-99m doses.
What Is Still Open?
The comment period ended January 20, 2026. CMS published a correction on February 23, 2026, covered in CMS corrects the CY 2026 OPPS final rule. The Inpatient Only list phase-out continues in later years.
CMS proposed the CY 2027 version on July 7, 2026, and the CY 2027 OPPS and ASC proposed rule post covers it. For the full facility process, see the hospital revenue cycle guide, and see hospital and facility billing for how Nucleus Align works on UB-04 claims.
- Medicare Program: Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems (CMS-1834-FC), 90 FR 53448 · Federal Register
- Calendar Year 2026 Hospital Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center Final Rule (CMS-1834-FC) · CMS
We check every rule, code and deadline against the official source. See our editorial policy.
Common Questions
Straight answers from the team that does the work.
Ask a billing lead directly. A 20-minute call, Monday to Friday, 9am to 5pm Eastern.
01What is the CY 2026 OPPS conversion factor?
The final rule uses a conversion factor of $91.415 for CY 2026. Hospitals that fail the Hospital OQR Program requirements get a reduced factor of $89.632. The factor is multiplied by each APC's relative weight and adjusted for the hospital's wage index to get the payment.
02How much did CMS update OPPS and ASC payments for 2026?
CMS finalized a 2.6 percent update for hospitals meeting quality reporting requirements. It is based on a 3.3 percent hospital market basket increase reduced by a 0.7 percentage point productivity adjustment. The ASC update factor is also 2.6 percent for ASCs that meet reporting requirements.
03When was the CY 2026 OPPS and ASC final rule published?
CMS issued it on November 21, 2025, and the Federal Register published it on November 25, 2025 at 90 FR 53448. The provisions took effect January 1, 2026, and comments on the final rule with comment period were due by January 20, 2026.
04What happens to the Inpatient Only list under this rule?
CMS is phasing it out over 3 years. For CY 2026 it removed 285 mostly musculoskeletal procedures, which Medicare can now pay in the hospital outpatient setting when clinically appropriate. The exemption from certain two-midnight medical review activities continues for those procedures.
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