Medicare IPPS and LTCH PPS FY 2027 Rates and Quality Program Requirements

CMS published the annual update to the Medicare Hospital Inpatient Prospective Payment System for acute care hospitals and the Long-Term Care Hospital Prospective Payment System for Fiscal Year 2027. The rule establishes updated payment rates, modifies diagnosis-related group (DRG) classifications, and updates policies affecting the calculation of hospital payments under Medicare.

Acute care hospitals and long-term care hospitals should review the finalized payment rates and policy changes to understand how their Medicare reimbursement will be affected for FY 2027 beginning October 1, 2026. Hospitals participating in Medicare quality reporting programs should ensure compliance with updated program requirements to avoid payment reductions.