For eight years, ASCs have received Medicare payment updates tied to the hospital market basket, which is a healthcare-specific inflation index designed to more accurately reflect the cost of running a surgery center than the general consumer price index it replaced.
That arrangement is due to expire at the end of 2026 unless CMS acts. On July 2, CMS proposed extending it for a ninth consecutive year, through 2027 — the same one-year renewal it has issued every year since 2019, with no guarantee it repeats after that. There is a bill in the House to make it permanent, but it has not passed and has no Senate companion.
If it lapses, ASCs revert to the Consumer Price Index for Urban Consumers, a general inflation measure that has historically trailed healthcare-specific cost inputs including wages, equipment and malpractice insurance.
How the gap got this wide
CMS aligned the ASC payment system with the hospital outpatient payment system in 2008 (phased in through 2011) but historically updated ASC rates using the Consumer Price Index for Urban Consumers. HOPDs, by contrast, received updates tied to the hospital market basket index, which tracks healthcare-specific cost inputs including wages and equipment. Because healthcare costs have inflated faster than general consumer prices, HOPDs pulled ahead annually under that structure.
In 2019, CMS began using the hospital market basket for a trial period, most recently extended through 2026, while continuing to evaluate the policy. The result of the prior CPI-U era is visible in the current reimbursement gap. Federal policy has cut ASC reimbursement from roughly 85% of hospital outpatient department rates to 62%, and the gap is widening, according to an analysis drawing on Medicare fee-for-service claims data from 2019 to 2024, comparing average payments for procedures performed at ASCs versus HOPDs at the HCPCS code level.
What the legislation would do
The Outpatient Surgery Access Act of 2026 — HR 8091 — was introduced March 25 by Reps. Beth Van Duyne, R-Texas, and John Larson, D-Conn. If enacted, it would permanently align annual payment updates for ASCs with hospital outpatient departments beginning in 2027, eliminate an ASC-specific budget-neutrality adjustment that has depressed reimbursement, and require CMS to take ASC spending into account when calculating certain outpatient payment adjustments, according to the bill text and a news release from Ms. Van Duyne’s office.
“Outdated Medicare policies are limiting access to high-quality and lower-cost care,” Ms. Van Duyne said in a statement. “Our healthcare system should reward high-quality, lower-cost care, not stand in its way.”
The budget-neutrality provision is the less-discussed element but carries real financial weight. The Outpatient Surgery Access Act would remove a budget-neutrality adjustment that ASCA said has suppressed ASC reimbursement, in addition to locking in the market basket update factor, according to ASC News coverage of the bill’s introduction.
“Surgery centers perform millions of essential elective procedures for Medicare beneficiaries every year,” ASCA CEO Bill Prentice said in a statement. “Ensuring an accurate and stable payment system is key to protecting patient access to low-cost, high-quality surgery centers.”
What passage would — and would not — fix
Advocates are careful to frame what the legislation would accomplish. Making the market basket update permanent would not close the reimbursement gap with HOPDs; it would stop the gap from continuing to grow.
“From a methodology perspective, it makes sense for CMS to use the same update framework for ASCs that it uses for hospitals,” Matthew Humbarger, group vice president of payer engagement and strategy at SCA Health, told Becker’s. “That kind of consistency supports sustainability and helps ensure ASCs remain a high-value option for outpatient care.”
The projected savings from the current ASC model underscore the stakes. Assuming ASC capacity and participation holds, annual Medicare savings from ASC utilization are projected to reach $12.5 billion by 2034. If reimbursement rates fall to levels where providers cannot cover costs, cases may remain in HOPDs or not get performed at all, according to an analysis from ASCA.
The legislative gap
As of early July 2026, no Senate companion bill had been filed. The bill has been referred to the House Committee on Energy and Commerce and the Committee on Ways and Means, according to Congress.gov — the standard path for Medicare payment legislation, and one that does not guarantee floor consideration before the end-of-year deadline.
However, CMS’ July 2 proposal to extend the market basket update through 2027 means that, if finalized as expected around November, the immediate cliff doesn’t happen regardless of what Congress does with HR 8091.
At the Becker’s 32nd Annual Meeting: The Business and Operations of ASCs, taking place October 29-31 in Chicago, ASC leaders, surgeons and healthcare executives will explore strategies to drive growth, enhance operational performance, navigate reimbursement challenges and prepare for the future of ambulatory surgery. Apply for complimentary registration now.
