On July 7, 2026, the Centers for Medicare and Medicaid Services proposed a new regulatory framework for off-campus outpatient departments under the Consolidated Appropriations Act, 2026.
The proposed rule implements changes required by Section 6225 of the Consolidated Appropriations Act, 2026, which fundamentally altered the compliance and payment landscape for off-campus outpatient departments.
Effective January 1, 2028, Medicare will deny all Outpatient Prospective Payment System payments to off-campus outpatient departments that fail to meet two new statutory requirements.
Those requirements are compliance with mandatory attestation rules and the use of a National Provider Identifier separate from that of the main hospital for each off-campus outpatient department.
Providers with existing off-campus outpatient departments must submit initial attestations by December 31, 2027, to avoid losing Medicare reimbursement under the new framework.
Departments beginning operations after January 1, 2028, must submit an attestation within two years before furnishing services, with subsequent attestations required at intervals not exceeding five years.
The proposed rule introduces a new definition of “off-campus outpatient department” as any provider-operated facility not located on the main provider’s campus or not within 250 yards of a remote hospital location.
Facilities within 250 yards of a remote location are treated differently and are not subject to the new attestation or separate NPI requirements, creating important operational distinctions for multicampus hospitals.
CMS proposes a standardised attestation form and centralised electronic submission system, though legacy Medicare Administrative Contractor-specific templates will remain accepted until the new system is finalised.
The attestation form will require providers to demonstrate compliance with structural, clinical, financial, public awareness, and location documentation requirements under 42 CFR 413.65.
CMS and MACs will process attestations through a three-tiered review process, beginning with automated validation, moving to targeted review for high-risk submissions, and culminating in extended on-site audits for a risk-selected subset.
Providers flagged during targeted review will have a 60-day response period to supply supporting documentation before a compliance determination is issued.
All determinations made under the new process will constitute initial CMS decisions and will be subject to standard administrative appeal procedures.
CMS is accepting public comments on the proposed rule until August 31, 2026, including on the operational feasibility and potential burden of the documentation requirements.
Attorneys from Epstein Becker and Green recommend that hospitals immediately conduct an inventory of all off-campus outpatient departments, apply for separate NPIs, and audit compliance with the relevant provisions of 42 CFR 413.65.