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CMS just dropped a bombshell on outpatient surgery centers.
Starting in 2026, they’re dismantling the Inpatient Only list over 3 years, beginning with 285 musculoskeletal procedures.
But here’s what nobody’s talking about:
📊 ASCs get a 2.9% payment increase (barely covering inflation at 3.4%)
🏥 Over 500 procedures suddenly approved for ASC settings
💰 The 340B remedy offset continues slashing payments by 0.5% annually through 2041
This creates a fascinating paradox.
CMS is pushing complex surgeries into outpatient settings while simultaneously squeezing reimbursements. They’re expanding ASC procedure lists dramatically but offering payment updates that don’t even match inflation.
The real winners? High-volume ASCs that can capitalize on the 500 new approved procedures.
The losers? Rural hospitals already struggling with the 340B offset, now facing more competition from ASCs for surgical cases they depend on for revenue.
Here’s my take:
This isn’t just about site of service. It’s about fundamentally restructuring how we deliver surgical care in America. CMS is betting that ASCs can handle increasingly complex procedures at lower costs.
But when you combine inadequate payment updates with expanding scope, you’re asking facilities to do more with less, year after year.
The 16-year 340B payback timeline through 2041 is particularly brutal. That’s $7.8 billion being clawed back from hospitals, many serving vulnerable populations.
Smart ASCs will invest now in capability expansion. Smart hospitals will double down on procedures that truly require inpatient resources.
Everyone else? They’ll be caught in the middle of this massive healthcare delivery transformation.
♻️ Repost if healthcare payment reform needs more than inflation adjustments
👉 Follow me, Jonathan Govette, for real-time updates on healthcare technology and business news. LinkedIn Profile: https://www.linkedin.com/in/jonathangovette/
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Author:
Jonathan Govette is a seasoned healthcare and technology executive with more than two decades of experience building, scaling, and advising digital health companies. He is the Co-Founder and CEO of Oatmeal Health, an AI-driven Lung Cancer Screening and Diagnostics company focused on expanding access to early detection for underrepresented populations, particularly patients served by Federally Qualified Health Centers and value-based health plans.
With a background in engineering, product development, and strategic partnerships, Jonathan has founded and led multiple health technology ventures across clinical care delivery, regulated medical software, and AI-enabled diagnostics. His work sits at the intersection of medicine, technology, and health equity, with a consistent focus on translating complex clinical problems into scalable, real-world solutions.
Jonathan has spent much of his professional life dedicated to improving outcomes for marginalized and underserved communities. He has designed and implemented frameworks that align clinical quality, reimbursement, and technology to sustainably advance health equity at scale. This mission is deeply personal and informs his leadership philosophy and long-term vision for healthcare transformation.
In addition to his operating experience, Jonathan is an author and long-time writer in the healthcare domain, with over 20 years of published work covering digital health, medical innovation, and healthcare systems. He is a frequent mentor to early-stage founders and regularly advises startups on product strategy, partnerships, and go-to-market execution in regulated healthcare environments.
Before entering industry full-time, Jonathan nearly pursued a career in medicine with an early path toward cardiothoracic surgery, an experience that continues to shape his clinical perspective and respect for frontline care delivery.
CEO | Oatmeal Health | AI Lung Cancer Startup | Engineer | Writer | Almost Became a Doctor (Cardiac Thoracic Surgeon) | 3x Health Tech Founder | Startup Mentor | Follow to share what I’ve learned along the way.
