HR7863-119

What This Bill Does

The Promoting Fairness for Medicare Providers Act of 2026 creates a new Medicare payment category beginning in 2027 for specified high-supply-cost surgical procedures performed in a qualifying physician office. Medicare would treat the procedure much like one performed in an ambulatory surgical center, but the office-based facility-service amount would generally equal 90 percent of the comparable ambulatory surgical center payment. Device-intensive procedures use the existing device-intensive calculation with the nondevice portion reduced to 90 percent.

A procedure initially qualifies if, as of 2023, Medicare paid for it in an ambulatory surgical center and as an office procedure, and its HCPCS code included a supply item priced above $500. Multiple units of the same supply may be aggregated. Beginning in 2028, HHS must review the list annually through rulemaking, add procedures above the indexed threshold, and may remove procedures at or below 80 percent of that threshold.

Beneficiary coinsurance for the new facility service may not exceed the annual Medicare inpatient hospital deductible. When the cap reduces the patient's share, Medicare must increase its payment to the office-based facility by the difference. A qualifying office must meet federal health and safety standards, sign an agreement accepting the payment as full facility payment, accept assignment for all covered facility services, and participate under the new category for all specified procedures it furnishes.

The bill also treats the covered procedures as commonly furnished in ambulatory surgical centers, applies the new payment method to covered off-campus hospital outpatient departments, recognizes office-based facilities as Medicare providers for these services, and extends federal and state survey responsibilities to them.

Who Benefits and How

Qualifying physician offices benefit from a new Medicare facility payment for high-cost supplies used in covered surgery. Physicians furnishing eligible procedures gain a more financially viable office setting. Medicare beneficiaries benefit from more site options and a coinsurance ceiling tied to the inpatient deductible. Medical-device and surgical-supply manufacturers may gain demand when more practices can furnish high-supply-cost procedures in offices.

Who Bears the Burden and How

Medicare payment accounts bear the new facility payments and must replace beneficiary coinsurance above the cap. Physician offices must satisfy safety standards, accept assignment, execute participation agreements, and accept the statutory amount as full facility payment. CMS payment and rulemaking staff must build claims logic, update thresholds and procedure lists annually, and administer device-intensive calculations. State survey agencies must assess office-based facility compliance. Ambulatory surgery centers and off-campus hospital departments may face payment or competitive changes as procedures shift settings.

Key Provisions

• Creates Medicare facility payment for qualifying office-based surgery beginning in 2027.
• Sets the general office facility amount at 90 percent of the comparable ambulatory surgical center rate.
• Modifies the calculation for device-intensive procedures.
• Limits beneficiary coinsurance to the inpatient hospital deductible.
• Requires Medicare to replace the provider payment lost through the coinsurance cap.
• Defines initial procedures using 2023 coverage and a supply-price threshold above $500.
• Requires annual rulemaking to add qualifying procedures and permits removal below the 80-percent threshold.
• Requires office health, safety, assignment, full-payment, and participation agreements.
• Extends provider recognition and survey duties to qualifying office-based facilities.