The SOS: Sustaining Outpatient Services Act amends section 1833(t)(1)(B) of the Social Security Act to add a new clause that permits Medicare payment determinations under the hospital outpatient prospective payment system (OPPS) for certain items and services furnished by off‑campus outpatient departments of a provider. The inclusion applies beginning in 2027 and is conditioned on a prior‑year payment test tied to physician specialty payments under the physician fee schedule.
Practically, the bill instructs Medicare to treat off‑campus outpatient department services as OPPS‑payable when, for that item/service, the largest aggregate amount paid under the physician fee schedule to any single physician specialty in the prior year was below $2,000,000. That creates a narrow pathway for low‑volume specialty services to receive hospital outpatient payment treatment while leaving higher‑volume items/services outside the change.
At a Glance
What It Does
Amends 42 U.S.C. 1395l(t)(1)(B) by adding clause (vi) to include, beginning in 2027, items and services furnished by off‑campus outpatient departments in the OPPS payment determination when the prior‑year aggregate PFS payments for the relevant item/service to the top physician specialty were under $2 million. The bill references the physician fee schedule under section 1848 and the statutory definition of an off‑campus outpatient department.
Who It Affects
Hospitals with off‑campus outpatient departments and the physician specialties that furnish the relevant items/services, Medicare Administrative Contractors and CMS (which must identify qualifying items/services annually), and ultimately Medicare beneficiaries who receive care in those settings.
Why It Matters
The bill creates an item‑by‑item rule that can shift payment methodology from the physician fee schedule to hospital OPPS for low‑volume specialty services, changing revenue flows and site‑of‑service incentives and imposing new data and operational requirements on CMS and payers.
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What This Bill Actually Does
The SOS Act inserts a narrow exception into Medicare’s payment rules that applies to off‑campus outpatient departments. For each item or service furnished at such a department, CMS must look back to the prior year and add up how much the physician fee schedule paid to physicians across specialties for that item or service.
If the physician specialty that received the largest total for that item or service still received less than $2,000,000 in the prior year, that item or service becomes eligible to be paid under the hospital outpatient prospective payment system rather than under the physician fee schedule.
The bill operates at the item/service level and ties eligibility to an aggregate dollar threshold measured by physician specialty. It explicitly applies only to off‑campus outpatient departments of a provider as defined elsewhere in statute, and it takes effect for items and services furnished in 2027 and later.
The statutory amendment is precise about which subsection of the Social Security Act changes (1833(t)(1)(B)), and it cites the physician fee schedule authority (section 1848) as the comparative basis for the threshold test.Operationally, the change forces CMS to identify which codes or service groupings meet the $2 million top‑specialty threshold each year and then to treat those services when furnished in qualifying off‑campus locations as OPPS items. The bill does not specify how CMS should aggregate payments (for example, by HCPCS/CPT code, code groupings, or service bundles), nor does it set out transitional rules, payment rates, or audit procedures.
Those implementation details will fall to CMS rulemaking and contractor operations once the statutory eligibility rule is in place.Because the test focuses on the prior year’s physician fee schedule payments broken out by physician specialty, the provision creates a direct link between physician billing patterns and whether an item or service is paid as an OPPS hospital service at off‑campus locations. That link can change incentives for where services are furnished and how they are billed, particularly for specialties and items near the $2 million threshold.
The Five Things You Need to Know
The bill adds a new clause (vi) to 42 U.S.C. 1395l(t)(1)(B) to permit certain off‑campus outpatient department items/services to be included in OPPS payment determinations.
The eligibility rule applies beginning in 2027 and is triggered per item/service based on prior‑year payment data.
CMS must compare prior‑year physician fee schedule payments by physician specialty; if the greatest total paid to any specialty for that item/service was under $2,000,000, the item/service qualifies for OPPS treatment when furnished off‑campus.
The provision applies only to off‑campus outpatient departments as defined in the Social Security Act (paragraph (21)(B)); on‑campus departments and other settings are not affected by this clause.
The statute relies on section 1848 (the physician fee schedule) as the data source for the threshold test but does not prescribe the aggregation unit (codes vs. bundles) or implementation procedures.
Section-by-Section Breakdown
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Short title — 'SOS: Sustaining Outpatient Services Act'
A single‑line provision that names the act. No operational effect beyond providing the bill’s short title for citation.
Adds clause (vi) allowing OPPS payment treatment for certain off‑campus outpatient department services
This is the substantive change: the bill inserts a new clause that instructs Medicare to include, for a year beginning with 2027, items and services furnished by an off‑campus outpatient department of a provider in the OPPS payment determination when the prior‑year physician fee schedule payments for that item/service—measured by the largest total received by any physician specialty—were under $2,000,000. The provision therefore creates an objective dollar threshold keyed to prior PFS payments and limits application to off‑campus provider‑based departments as statutorily defined.
Conforming punctuation and insertion language
The amendment also makes minor drafting adjustments to the existing clauses in 1833(t)(1)(B): it changes punctuation and inserts the phrase 'subject to clause (vi)' into clause (v). These edits ensure clause (vi) is read as an additional exception to the existing list rather than replacing other language.
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Explore Healthcare in Codify Search →Who Benefits and Who Bears the Cost
Every bill creates winners and losers. Here's who stands to gain and who bears the cost.
Who Benefits
- Hospitals operating off‑campus outpatient departments that furnish low‑volume specialty services — they gain the option (for qualifying items/services) to receive OPPS payment treatment, which can increase revenue stability compared with PFS payments tied to physician billing patterns.
- Physician specialties that fall below the threshold for their furnished items/services — their services at hospital‑affiliated off‑campus sites will be eligible for hospital OPPS reimbursement, which can preserve local access if hospital payments are more favorable.
- Patients in communities served by provider‑based off‑campus facilities — if OPPS payments bolster the financial viability of those sites, patients may experience fewer site closures and continued local access to outpatient procedures and diagnostics.
Who Bears the Cost
- The Medicare program/Trust Fund — shifting eligible items/services into OPPS could raise program spending relative to baseline physician fee schedule payments, depending on payment differentials and utilization.
- CMS and Medicare Administrative Contractors — they must develop and maintain the prior‑year payment calculations by item/service and specialty, update eligibility annually, and manage associated billing and audit guidance.
- Physician practices and freestanding providers that rely on PFS billing for items/services — they may experience revenue shifts or altered site‑of‑service incentives as certain services at hospital‑affiliated off‑campus locations migrate to OPPS payment rules.
Key Issues
The Core Tension
The bill pits two legitimate goals against each other: preserving access and revenue stability for low‑volume, off‑campus services by extending hospital OPPS treatment, versus maintaining tight, administrable payment rules and fiscal discipline that avoid site‑of‑service payment escalation and gaming; the chosen $2 million threshold and lack of implementation detail make balancing those goals difficult in practice.
The bill establishes a single, dollar‑based eligibility test but leaves critical implementation choices unspecified. It does not define the unit of analysis for the prior‑year calculation (individual HCPCS/CPT codes, code groups, or clinical bundles), nor does it prescribe how physician specialty attribution is handled for multi‑specialty services.
Those omissions give CMS latitude but also create ambiguity that could produce inconsistent determinations across contractors, complicate provider billing, and invite disputes over how a service is classified for the threshold test.
The $2,000,000 cutoff is a blunt instrument that creates cliff effects: a small change in prior‑year physician fee schedule payments could flip an item/service between OPPS and PFS treatment, producing strong incentives to alter billing, coding, or site‑of‑service practices. The statute’s focus on the 'greatest total amount paid with respect to a physician specialty' concentrates the test on the top specialty for a given item/service, which avoids diluting the measure across many small specialties but also means specialties just above or below the top position will influence eligibility in nontransparent ways.
Finally, because the bill applies only to off‑campus provider‑based departments as statutorily defined, hospitals may have an incentive to restructure or reclassify sites to capture OPPS payment, raising oversight and audit questions that the statute does not address.
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