Site neutral imaging payment 2027: what to model now

The number most people attach to site neutral imaging payment is 40 percent, and it's the wrong number: that rate belongs to an existing, separate policy for clinic visits. What CMS proposed for 2027, in the hospital outpatient proposed rule CMS-1850-P put on public display July 2, 2026, is a Physician Fee Schedule equivalent rate, generally lower than the applicable OPPS rate, for imaging without contrast furnished at off campus provider based departments excepted under section 603 of the Bipartisan Budget Act of 2015. The proposal covers APCs 5521 through 5524 plus composite APCs 8004 for ultrasound, 8005 for CT and CTA without contrast, and 8007 for MRI and MRA without contrast, and CMS estimates roughly $260 million in combined Medicare and beneficiary savings in CY2027. Nothing in it is final. The Federal Register record for CMS-1850-P gives a publication date of July 7, 2026 and a comment close date of August 31, 2026, and a final rule is expected in early November 2026.

This page is for the person who runs the imaging department. It covers what the proposal does, which of your locations it touches, why that 40 percent figure will corrupt your model, and how to calculate your own exposure from rates published in the rule itself.

Status, last verified July 31, 2026: PROPOSED, NOT FINAL. This page will be updated when the CY2027 outpatient final rule publishes.

CMS proposed a rate substitution for non contrast imaging

The mechanism is a rate substitution. Today, an excepted off campus provider based department bills the applicable OPPS rate for an imaging study. Under the proposal, for the covered non contrast services, the same department would be paid the amount the Physician Fee Schedule pays for the same service. CMS describes this as building on the site neutral policies it has applied since 2019.

Three features matter operationally:

• It's limited to imaging without contrast. Contrast enhanced studies sit outside the covered APC list. A facility whose non contrast mix is small has proportionally small exposure.
• It applies to a specific status of department. Excepted status is a historical artifact, not a description of the building. Two hospital owned outpatient locations across town from each other can sit on opposite sides of this line.
• It's a technical component policy. It changes the facility payment for performing the study and leaves the professional payment for interpreting it untouched.

Which of your locations this touches

Scope here turns on billing status under section 603, and billing status doesn't map neatly onto geography or building type, which is why most facilities get this question wrong.

Setting	Pays today	Under the proposal
On campus hospital outpatient department	OPPS rate	Outside this proposal
Off campus provider based department, excepted under section 603	OPPS rate	PFS equivalent rate for covered non contrast imaging
Off campus provider based department, non excepted	Already PFS equivalent	No change
Rural sole community hospital	OPPS rate	Would remain exempt
Freestanding imaging center	Physician Fee Schedule	No change

Excepted status generally belongs to off campus locations that were furnishing and billing outpatient services before the November 2, 2015 cutoff in section 603 and have maintained that status since. If you don't know which of your locations are excepted, establish that first, because it determines whether any of this applies to you at all. Your revenue cycle team can identify it from the modifier used on outpatient claims. And if all of your imaging sits on campus, or your excepted departments do little non contrast work, this rule is close to a non event for you: skip the modeling and spend the planning time elsewhere.

One number to keep out of your model

The 40 percent figure that circulates in site neutral coverage has no place in an imaging model. It describes a different, already existing policy: the site neutral payment for clinic visits at excepted off campus departments, paid at 40 percent of the OPPS rate. For imaging, the ratio between the Physician Fee Schedule and OPPS varies by modality, and it varies again by geography.

Applying a flat 40 percent to your imaging revenue produces a number that's wrong in a direction you can't predict, because for some imaging services the two payment systems sit close together and for others they sit far apart. Model the actual rates.

How do we model our own site neutral imaging exposure?

Your exposure is a per study rate difference multiplied by your own non contrast volume, built from the rates in Addendum B of the proposed rule. There's no honest national per study table for this, and you should be skeptical of any page that publishes one. Both payment systems are geographically adjusted: OPPS applies a wage index, and the Physician Fee Schedule applies geographic practice cost indices. Two hospitals in different states running the same MRI volume have different exposure, and a national average would mislead each of them differently.

Work it in five steps:

1. Identify the excepted departments. Only excepted off campus provider based departments are in scope. Everything else drops out of the model immediately.
2. Pull twelve months of non contrast volume at those locations, split by modality: X-ray, ultrasound, CT and CTA without contrast, MRI and MRA without contrast. Contrast studies are out of scope.
3. For each modality, find the current OPPS payment and the proposed PFS equivalent amount for the codes you bill, adjusted for your locality. Addendum B lists the proposed CY2027 payment rate for every covered APC alongside the corresponding fee schedule amounts.
4. Multiply the per study difference by your annual volume for that modality, then sum across modalities. That's your modeled annual technical component exposure.
5. Sensitivity check it. Run the same calculation at plus and minus 15 percent volume. Exposure scales linearly with volume, and your volume forecast is the softest input in the model.

The output is a single annual dollar figure for the technical component, at your locations, at your locality, built from published rates.

Site neutral imaging payment leaves the professional component alone

The proposal changes the facility payment for performing a study and leaves the professional component, the payment for interpreting it, untouched. The arrangement under which your radiologists read, and the turnaround you've contracted for, both sit outside the scope of this rule.

Protect that distinction inside your own modeling, because the two get conflated quickly in budget conversations. A technical component reduction changes what your facility collects for operating the scanner. It doesn't change what an interpretation costs, and it doesn't make a reading arrangement more or less economic on its own. If your organization responds to a technical hit by reopening the reading arrangement, that should be its own deliberate decision, with its own analysis.

For facilities separately weighing how interpretation is staffed and costed, teleradiology cost per read covers the industry ranges and in-house vs outsourced radiology sets out the break even framework. Neither is affected by this proposal.

Where the studies get performed is the bigger question

The direct arithmetic is the smaller half of this; the larger question is whether the payment change moves where studies are performed, and that's where imaging leaders should spend their planning attention.

Site neutral policy exists to remove the payment differential that makes the same study more expensive in a hospital owned department than in a freestanding office. If the differential narrows for non contrast imaging, the first thing that tends to move is mix within your own network: scheduling gravitates toward whichever location carries the better economics for the payer and the patient, and the volume profile at each location can change without anyone making a strategic decision. The second is that contrast and non contrast economics diverge. Because the proposal covers non contrast studies only, a non contrast MRI and a contrast enhanced MRI at the same excepted department would move apart in facility payment, and while protocol decisions are clinical and must stay clinical, the finance model should stop treating the two as one line. The third is that capacity planning gets harder before it gets easier, because a modality whose facility payment falls still carries the same fixed cost base: the scanner, the technologists, the service contract, the hours. None of this changes the interpretation requirement. Every study still has to be read, at the same turnaround, by a radiologist qualified for the modality and licensed in the state where the patient is located. What shifting volume does change is predictability: the volume at any one location becomes harder to forecast while the total stays roughly flat, which is the practical argument for reading capacity that flexes with volume, whether through MRI teleradiology reporting or X-ray and ultrasound overflow coverage.

A facility that models only the per study delta will miss the operational consequence, which is variance.

CMS estimates $260 million in 2027 savings

CMS estimates the proposal would reduce Medicare spending by about $190 million and beneficiary cost sharing by about $70 million in CY2027, roughly $260 million combined. Over ten years, CMS estimates savings of about $7 billion. The Committee for a Responsible Federal Budget, working from Congressional Budget Office methodology, estimates roughly $10 billion in federal savings over the same period, plus about $7 billion in reduced beneficiary premiums and cost sharing.

Both are aggregate national estimates attached to a proposal; your own number comes out of the worksheet above. And the beneficiary side belongs in your internal discussion: patients receiving non contrast imaging at an affected department would owe less, because coinsurance follows the payment rate.

Five moves before the final rule

The comment window on CMS-1850-P is open until August 31, 2026, so there is still time to file, and the rest of the work runs alongside it:

• File a comment if the exposure model above shows a material number. The docket, and the deadline, are on the Federal Register record for CMS-1850-P.
• Finish the exposure model before the final rule publishes, so November becomes a confirmation exercise.
• Confirm excepted status location by location and document it. This determination drives the entire calculation, and it's frequently assumed when it should be verified.
• Separate the technical and professional lines in whatever budget model results, so a facility payment change is read as exactly that and nothing more.
• Watch for the final rule in early November 2026. CMS may finalize as proposed, modify the scope, or decline to finalize. All three have happened with site neutral proposals before.

The honest position on site neutral imaging payment in mid 2026: a proposal with a clearly defined scope, a published savings estimate, and a fair chance of being finalized in some form. You can model it now. You can't book it yet.

This page will be updated when the CY2027 hospital outpatient final rule publishes. For questions about how your interpretation coverage is structured and priced, independent of facility payment policy, book a coverage consultation.