Medicare Bill Mandates Site-Neutral Payments by 2027, Excluding ER and Trauma Care

The Same Care, Lower Cost Act is taking aim at one of the biggest drivers of Medicare spending: paying different amounts for the exact same medical procedure just because of the address where it was performed. Starting in 2027, this bill mandates “site-neutral” payments for a significant chunk of outpatient services, meaning Medicare will pay the same rate whether you get that procedure done at a hospital’s outpatient department or a standalone surgical center. This is a big deal for the healthcare economy and your wallet as a taxpayer.

The End of Location-Based Pricing

Think of it like this: If you buy the same brand of coffee, the price shouldn't double just because one store has a fancier sign. Right now, Medicare often pays hospitals significantly more than independent clinics for the same services—like a colonoscopy or a cataract removal—when performed in a hospital outpatient setting. This bill, specifically Section 2, requires the Secretary to identify at least 66 specific service codes (called Ambulatory Payment Classifications, or APCs) that will be subject to this new site-neutral payment rule. The goal is straightforward: pay for the service, not the setting. For taxpayers footing the bill for Medicare, this promises significant cost savings by removing that location-based inflation.

Where the Money Shifts

If you work in healthcare, this change hits hard. Hospital Outpatient Departments (HOPDs) are currently the higher-paid setting, and they stand to see their revenue drop for these specified procedures starting in 2027. Conversely, independent Ambulatory Surgical Centers (ASCs) might see a more stable or even slightly increased payment, depending on how the new site-neutral rate is calculated. The bill requires the Secretary to look at recommendations from the Medicare Payment Advisory Commission (MedPAC) when setting the list of procedures, which suggests they’re aiming for a rate that balances costs and quality. For the average person, this could mean more incentive for routine procedures to be done in lower-cost, potentially more efficient, standalone centers.

Carving Out Critical Care

Here’s the catch, and it’s a crucial one: Not everything is going site-neutral. The bill explicitly protects emergency department visits, critical care, and trauma care provided at HOPDs from these new rules. Instead, these services will be bundled into a single payment unit called a “Comprehensive APC.” This makes sense—you don't want to disincentivize hospitals from maintaining expensive, always-available emergency services. However, this bundling adds complexity. If the new bundled payment for emergency care isn't calculated carefully, it could inadvertently underpay hospitals for the comprehensive, high-acuity care they provide in the ER, which could lead to its own set of access issues down the line. The Secretary gets the final say on how this bundling works, granting them significant authority over how emergency services are reimbursed.