Imaging without contrast at excepted off-campus PBDs moves to the PFS-equivalent rate on January 1, 2027
Published November 8, 2026 · Coverage November 1–7, 2026, Pacific · Medium priority
Using its volume-control authority under section 1833(t)(2)(F), CMS will pay the site-specific Physician Fee Schedule (PFS)-equivalent rate (currently 40 percent of the Hospital Outpatient Prospective Payment System (OPPS) amount) for imaging without contrast services in ambulatory payment classifications (APCs) 5521 through 5524 and composite APCs 8004, 8005 and 8007 when furnished at excepted off-campus provider-based departments (PBDs) billing modifier PO. The policy is not budget neutral and has no phase-in. Rural sole community hospitals are exempt. CMS estimates a $260 million decrease in CY 2027 payments ($190 million Medicare, $70 million beneficiary copayments).
Background
Under section 603 of the Bipartisan Budget Act of 2015, applicable items and services furnished by certain off-campus outpatient departments of a provider on or after January 1, 2017 are, as a general matter, not paid as covered outpatient department services under the OPPS; in most cases CMS pays these nonexcepted departments under the PFS, at a relativity adjuster of 40 percent of the OPPS amount. Excepted departments bill modifier PO and are generally paid the OPPS rate; in its CY 2019 rule CMS adopted a policy to pay them the PFS-equivalent rate for clinic visits, phased in over 2 years (approximately 70 percent of the OPPS rate in CY 2019, then the full PFS-equivalent rate, 60 percent less than the OPPS rate, from CY 2020), and in CY 2026 it finalized a policy addressing drug administration services at excepted departments.
Who this affects
Hospitals with excepted off-campus provider-based departments that bill imaging without contrast with modifier PO; rural sole community hospitals are exempt.
Why it matters
Hospitals with off-campus imaging centers billed as excepted PBDs should expect lower Medicare payment for certain bone density scans, X-rays, ultrasounds, CT scans and MRIs without contrast in those departments. Inference: affects service-line and site-of-care planning and any MA contracts tied to OPPS rates.
Recommended action
- Identify excepted off-campus PBD imaging volume billed with modifier PO in APCs 5521-5524 and 8004/8005/8007 and model the CY 2027 reduction
- Confirm PO and PN modifier accuracy by department
Implementation playbook
- List excepted off-campus departments that bill with modifier PO and furnish imaging without contrast in APCs 5521 to 5524 or composite APCs 8004, 8005 and 8007, and confirm whether the hospital is an exempt rural sole community hospital. Owner: Reimbursement. Due: 2026-11-30.
- Model the revenue effect of payment at the physician fee schedule equivalent rate (currently 40 percent of the outpatient amount) for those services. Owner: Finance. Due: 2026-12-15.
- Update expected-reimbursement tables in the billing system. Owner: Revenue Cycle. Due: 2026-12-31, ahead of the January 1, 2027 effective date.
Scope and timing
- Authority status
- Final
- Responsible owner
- Finance / Reimbursement; Imaging service line
- Publication date
- 2026-11-06
- Effective date
- 2027-01-01
Not established
HCPCS-level list is in Addendum B (not retrieved). Press release figure of over $9 billion for CY 2027 to CY 2036 not checked against the rule's 10-year estimate.
Sources
Complete edition and supplemental material
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