CMS Just Cleared 637 More Surgeries for Outpatient. Nursing Homes Fear It’ll Starve Them of Medicare Patients.

Washington, D.C. — The federal government is moving hundreds of surgical procedures out of hospitals, and the nation’s nursing homes are bracing for the fallout.

The Centers for Medicare & Medicaid Services published its proposed 2027 Hospital Outpatient Prospective Payment System rule on July 2, and tucked inside is a plan to strip 637 more services from the inpatient-only list. That list has historically confined complex procedures to hospital settings, largely because patients need at least a full day of monitored recovery.

If the proposal is finalized, those surgeries could shift to outpatient centers or ambulatory surgical units. For hospitals, that’s a win. For skilled nursing facilities, it’s a warning sign.

Here’s why: Medicare won’t cover a post-hospital stay in a nursing home unless a patient spends at least three days as an inpatient. If a surgery is performed on an outpatient basis, that three-day clock never starts. Patients go home instead — and the SNF bed stays empty.

CMS has already been chipping away at the inpatient-only list. The agency began a three-year phaseout in 2026 with the goal of eliminating it entirely by January 1, 2029. The latest batch targets auditory, diaphragmatic, digestive, endocrine, respiratory, and urinary procedures, according to industry reports.

The move is part of a broader push to drive care toward lower-cost settings. CMS is also expanding the list of procedures covered at ambulatory surgical centers, proposing to add roughly 618 services to that roster. Payment rates for outpatient and ASC services would rise 2.4 percent under the plan.

But nursing home operators argue the policy ignores the practical reality of post-acute care. A patient who undergoes a complex respiratory or endocrine procedure may look stable enough to leave the hospital the same day, but many still need short-term rehabilitation, wound care, or skilled monitoring that only a SNF can provide. When Medicare coverage disappears, families either pay out of pocket or forgo the care entirely.

The latest proposal lands in a climate already raw for operators. CMS has spent the summer tightening its grip on the sector, including a move earlier this month to accelerate Medicare terminations and claw back payments from day one of a violation.

The proposed rule is open for public comment through August 31. Industry groups are expected to press hard for carve-outs or alternative coverage pathways that protect SNF access.