SPEND MANAGEMENT OUTLOOK
Seven federal policy developments that could shape health system strategy in 2027.
Federal policy increasingly influences not only healthcare reimbursement and compliance requirements, but also pharmacy strategy, supply chain resiliency, technology investment, and long-term financial planning. As health systems prepare for 2027, legislative and regulatory developments affecting drug pricing, reimbursement, and care delivery may carry significant implications for cost and access.
Here are seven policy developments hospital leaders should be tracking through the remainder of 2026.
In July 2026, CMS released the CY 2027 Outpatient Prospective Payment System (OPPS) proposed rule where they outline an approach to use data from the CMS Outpatient Drug Acquisition Cost Survey (ODACS) to inform reimbursement rates for separately payable 340B-acquired medications. Specifically, CMS proposes to reduce reimbursement for these medications from ASP+6%, generally, to ASP-33.4%.
Why it matters: CMS will decide whether to finalize the 340B-acquired drug reimbursement proposal in the CY 2027 OPPS final rule, which is typically released in fall 2026 for Jan. 1, 2027, implementation. Should CMS finalize the policy to reduce reimbursement of 340B-acquired drugs in a budget-neutral manner, CMS anticipates that, for most 340B providers, the decreased 340B drug payments will be more significant than the increased payments for non-drug services. Alternatively, for non-340B hospitals, CMS expects the policy will increase their 2027 OPPS payments, as payments for non-drug services would be increased due to budget neutrality requirements.
In July 2026, CMS released the CY 2027 OPPS proposed rule. Among other policies, CMS proposes to modify the previously finalized 340B remedy offset from -0.5% to -3%.
Why it matters: CMS will decide whether to finalize the 340B remedy offset proposal in the CY 2027 OPPS final rule, which is typically released in fall 2026 for Jan. 1, 2027, implementation. If finalized, impacted hospitals would see greater reimbursement reductions than previously expected, further straining limited resources. CMS anticipates that providers subject to the offset would experience $2.3 billion in payment reductions in CY 2027.
In the CY 2027 OPPS proposed rule, CMS proposes to continue phasing out the Inpatient-Only List (IPO List). Specifically, for the second year of the three-year phased approach, CMS intends to remove 637 services from the auditory, digestive, endocrine, female genital, hemic and lymphatic systems, integumentary, male genital, maternity care and delivery, mediastinum and diaphragm, and respiratory and urinary clinical families from the IPO list. Additionally, CMS proposes to continue expanding the Ambulatory Surgical Center Covered Procedure List (ASC-CPL) by adding 618 codes, including most codes that are proposed for removal from the IPO List.
Why it matters: As a result of this phased elimination, Medicare will cover more services when provided on an outpatient basis or when provided in an ASC. Collectively, these changes may bolster the shift towards outpatient care delivery. However, the elimination of the IPO List and rapid expansion of the ASC-CPL continues to raise concerns about patient safety due to the complexity of the services removed from the IPO List.
In June 2026, CMS issued a proposed rule regarding Medicaid State Directed Payments (SDPs) and an Interim Final Rule regarding Medicaid community engagement requirements. While the regulations both impact Medicaid and are the result of provisions in the One Big Beautiful Bill, they will shape the program in different ways.
Why it matters: Critically, hospital leaders should be aware that Medicaid fee-for-service and Medicaid managed care reimbursement rates are expected to decline in most states, starting with the first rating period on or after Jan. 1, 2028—though the effects will vary by state depending on how certain sections of the SDP proposed rule are finalized. Additionally, due to the community engagement requirements, CMS projects that Medicaid enrollment would be reduced by 2.3 million individuals beginning in FY 2027 and between 3.1 to 3.3 million individuals in each subsequent year until 2036. These changes are expected to impact payer mix, which is likely to increase bad debt and uncompensated care for hospitals, potentially having downstream consequences for 340B eligibility for some disproportionate share hospitals.
In April 2026, the White House announced a 100% tariff rate on patented pharmaceuticals scheduled to go into effect July 31 for large manufacturers listed in an annex to the announcement and Sept. 29 for the remaining manufacturers.
There are numerous exceptions and nuances to this announcement. For example, according to a White House report, 17 large manufacturers struck deals with the White House, meaning their tariff rate may be as low as 0%.
While the administration also has announced a Section 232 investigation into personal protective equipment and other medical devices, Section 232 tariffs have yet to be announced for these products.
In July 2026, CMS issued draft guidance to implement policies related to effectuation of the Maximum Fair Price (MFP) for the Medicare Drug Price Negotiation Program for 2028, which includes drugs payable under Part B and Part D. For example, CMS indicates that manufacturers must provide access to the MFP either prospectively or retrospectively, and the agency outlines options being considered for the standard default refund amount for selected drugs payable under Part B. In addition, CMS provides additional information relevant to hospitals and other Part B providers related to the Medicare Transaction Facilitator.
Why it matters: This is the first detailed policy that CMS has issued related effectuation of the MFP for 2028, which includes drugs covered under Part B. Throughout the draft guidance, CMS identifies several issues where stakeholder feedback is requested (e.g., the method to determine the standard default refund amount), signaling that aspects of the MDPNP that may evolve. Comments on the draft guidance are due Sept. 18 with final policy expected later this year.
The Consolidated Appropriations Act of 2026, which was signed into law Feb. 3, 2026, included a section that requires hospitals to obtain a separate National Provider Identifier (NPI) and attestation regarding the provider-based status for each off-campus outpatient department. These requirements generally go into effect Jan. 1, 2028. In the CY 2027 OPPS Proposed Rule, CMS proposes policy to implement this provision of the law.
Why it matters: These additional requirements are expected to impose significant additional administrative burden on providers well before the Jan. 1, 2028, timeline. The requirements also may have implications for HRSA OPAIS registration and billing systems, among others.
The policy landscape continues to evolve, and many of these policies have yet to be finalized. Staying informed is critical as health systems assess operational, financial, and strategic impacts heading into 2027.
Vizient Public Policy and Government Relations continues to monitor legislative and regulatory developments to help healthcare leaders anticipate change, adapt their strategies, and prepare for what's next.
Explore the Spend Management Outlook executive brief: Beyond inflation: Understanding the forces reshaping healthcare spend, as well as outlooks on capital, pharmacy, indirect spend and purchased services, laboratory, physician preference items, and medical-surgical (MedSurg).
Vice President, Regulatory Affairs and Public Policy at Vizient
Jenna Stern is vice president of regulatory affairs and public policy at Vizient, where she supports the organization's government relations strategy, monitors federal legislative and regulatory developments, and guides Vizient engagement on regulatory policy issues that are most important to Vizient and its clients...
