S. 5180

119 S5180 IS: Provider Reimbursement Stability Act of 2026
 U.S. Senate
 2026-07-30
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 II  119th CONGRESS  2d Session  S. 5180  IN THE SENATE OF THE UNITED STATES   July 30, 2026   Mr. Boozman  (for himself,  Mr. Welch ,  Mr. Marshall ,  Mr. King ,  Mr. Tillis , and  Mrs. Shaheen ) introduced the following bill; which was read twice and referred to the  Committee on Finance    A BILL
To amend title XVIII of the Social Security Act to ensure stability for provider payments under the Medicare program.
1.
Short title
This Act may be cited as the   Provider Reimbursement Stability Act of 2026  .
2.
Updating the budget neutrality threshold
Section 1848(c)(2)(B)(ii)(II) of the Social Security Act ( 42 U.S.C. 1395w–4(c)(2)(B)(ii)(II) ) is amended—
(1)
by striking  Subject to  and inserting the following:
(aa)
In general
Subject to
  ;
(2)
in item (aa), as inserted by paragraph (1), by striking  $20,000,000  and inserting  the amount specified in item (bb) for such year ; and
(3)
by adding at the end the following new items:
(bb)
Amount specified
For purposes of item (aa), subject to item (cc), the amount specified in this item is—
(AA)
for years before 2028, $20,000,000;
(BB)
for 2028, $57,640,000; and
(CC)
for 2029 and each subsequent year, the amount specified in this item for the preceding year.
(cc)
Indexing limitation on annual adjustments
For 2033 and every subsequent fifth year, the Secretary shall increase the amount specified in item (bb) for such year by the cumulative percentage increase in the MEI (as defined in section 1842(i)(3)) applicable to physicians’ services for each year occurring during the 5-year period ending on the last day of the preceding year.
  .
3.
Budget neutrality corrections relating to estimated utilization
(a)
In general
Section 1848(c)(2)(B) of the Social Security Act ( 42 U.S.C. 1395w–4(c)(2)(B) ) is amended by adding at the end the following new clause:
(vii)
Budget neutrality corrections relating to estimated utilization
(I)
In general
In the case of a budget neutrality adjustment applied pursuant to clause (ii)(II) for a year (beginning with 2029) that is determined in part using estimated utilization (as defined in subclause (II)(bb)) with respect to a specified service (as defined in subclause (II)(cc)), the Secretary shall, as part of the final rule establishing the physician fee schedule under this section for the assumption correction period (as defined in subclause (II)(aa)) with respect to such year—
(aa)
determine the difference between expenditures for such service in such year using estimated utilization and actual utilization for such service (in a manner determined appropriate by the Secretary); and
(bb)
in the case that the Secretary determines the difference described in item (aa) is greater than the threshold amount (as defined in subclause (II)(dd)) for such year, adjust the conversion factor under this section for such assumption correction period by such amount to reconcile such difference (which may be positive or negative), as determined by the Secretary.
(II)
Definitions
For purposes of this clause:
(aa)
Assumption correction period
The term  assumption correction period  means, with respect to a year, the second year beginning after such year.
(bb)
Estimated utilization
The term  estimated utilization  means an estimate of utilization used for purposes of applying clause (ii)(II).
(cc)
Specified service
The term  specified service  means, with respect to a year, a service—
(AA)
with expected expenditures for such year under this section based on estimated utilization that exceed the threshold amount (as defined in item (dd)) for such year; and
(BB)
for which payment had been bundled into payment for another service during the preceding year and for which a separate payment or add-on payment is made during such year.
(dd)
Threshold amount
The term  threshold amount  means, with respect to a year, 0.1 percent of the total estimated expenditures under this part for services furnished under this section during such year.
 .
(b)
Nonapplication of budget neutrality to reconciliation adjustments
Section 1848(c)(2)(B) of the Social Security Act ( 42 U.S.C. 1395w–4(c)(2)(B) ) is amended—
(1)
in clause (iv)—
(A)
in subclause (V), by striking  and  at the end;
(B)
in subclause (VI), by striking the period and inserting  ; and ; and
(C)
by adding at the end the following new subclause:
(VII)
clause (vii)(I)(bb) for an assumption correction period (as defined in clause (vii)(II)) shall not be taken into account in applying clause (ii)(II) with respect to such period.
  ; and
(2)
in clause (v), by adding at the end the following new subclause:
(XII)
Reductions attributable to an assumption correction
For an assumption correction period (as defined in clause (vii)(II)), reduced expenditures attributable to application of clause (vii)(I)(bb) with respect to such period.
  .
4.
Timely updates to direct costs used to calculate practice expense RVUs
Section 1848(c)(2)(B) of the Social Security Act ( 42 U.S.C. 1395w–4(c)(2)(B) ), as amended by section 3, is further amended by adding at the end the following new clause:
(viii)
Timely updates to direct costs used to calculate practice expense relative value units
(I)
Simultaneous updates to direct cost inputs at least once every 5 years
The Secretary shall, not later than 5 years after the date of the enactment of this clause, and not less often than every 5 years thereafter, update the prices and rates, as applicable, on a category-wide basis for each of the categories of direct cost inputs described in subclause (II) used in the methodology for calculating the practice expense relative value units under this subsection for physicians’ services. Updates made pursuant to the previous sentence shall be made in the same year for all categories of direct cost inputs described in such subclause.
(II)
Direct cost inputs categories described
For purposes of this clause, the categories of direct cost inputs described in this subclause are clinical staff wage rates, prices of medical supplies, prices of equipment, and any other category of such inputs used in the methodology described in subclause (I) (as specified by the Secretary).
(III)
Consultation
In making the updates under this clause, the Secretary shall consult with relevant stakeholders, including physician specialty societies.
 .
5.
Limitation on year-to-year conversion factor variance
Section 1848(c)(2)(B) of the Social Security Act ( 42 U.S.C. 1395w–4(c)(2)(B) ), as amended by sections 3 and 4, is further amended by adding at the end the following new clause:
(ix)
Limitation on conversion factor variance
(I)
In general
Beginning with 2028, the Secretary may not, for purposes of complying with clause (ii)(II), apply a budget neutrality adjustment to a conversion factor established under subsection (d) for such year that would cause such factor, not taking into account any adjustment to such factor for such year provided under such subsection, to vary by more than 2.5 percent compared to such factor so established for the preceding year.
(II)
Continued applicability of budget neutrality requirement
Nothing in subclause (I) may be construed to alter the requirement described in clause (ii)(II).
 .