# 2026-06675: Medicare Updates Psych Hospital Payments with New Tools for 2027

2026-06675, Medicare Program; FY 2027 Inpatient Psychiatric Facilities Prospective Payment System-Rate Update, is a Federal Register proposed rule from Health and Human Services Department, Centers for Medicare & Medicaid Services published 2026-04-07, effective 2026-10-01; PRIA reads it as touching household money (as of 2026-06-11).

- Canonical: https://policyrisk.com/federal-register/2026-06675
- As of: 2026-06-11
- Plain-text twin of the page above; the HTML and this file carry the same facts.

## Facts
- Document number: 2026-06675
- Title: Medicare Program; FY 2027 Inpatient Psychiatric Facilities Prospective Payment System-Rate Update
- Type: Proposed Rule
- Agencies: Health and Human Services Department; Centers for Medicare & Medicaid Services
- Citation: 91 FR 17720
- Published: 2026-04-07
- Effective: 2026-10-01
- Comments close: not stated
- Significant: no
- Touches household money: yes
- Regulation identifier numbers: 0938-AV77
- Last updated: 2026-06-11

## In one line

Medicare Updates Psych Hospital Payments with New Tools for 2027

## Summary

Starting October 1, 2026, Medicare is updating how it pays inpatient psychiatric hospitals, including changing payment rates, wage adjustments, and rules for extra-cost cases. They’re also introducing a new patient assessment tool and dropping two quality measures to keep things fresh and fair. These updates affect hospitals and patients and aim to improve care while managing costs through September 30, 2027.

## Abstract

This rulemaking proposes to update the prospective payment rates, the outlier threshold, and the wage index for Medicare inpatient hospital services provided by Inpatient Psychiatric Facilities (IPFs), which include psychiatric hospitals and excluded psychiatric units of an acute care hospital or critical access hospital. This rulemaking also proposes refinement of the IPF PPS outlier policy. These changes would be effective for IPF discharges occurring during the fiscal year beginning October 1, 2026, through September 30, 2027. We are also proposing the implementation of a standardized IPF patient assessment instrument, and the removal of two measures used in the Inpatient Psychiatric Facilities Quality Reporting Program.

## Effects PRIA read

- IPF Per Diem and ECT Rate Update: mixed, medium. Starting October 1, 2026, Medicare proposes to raise the Inpatient Psychiatric Facility (IPF) Federal per diem base rate from $892.87 to $912.58 and the electroconvulsive therapy (ECT) payment per treatment from $673.85 to $688.73. For IPFs that fail to report required quality data, CMS proposes lo…
- 20% Cap on IPF Outlier Payments: cost, medium. CMS proposes to limit an individual inpatient psychiatric facility's outlier payments to no more than 20 percent of its total IPF PPS payments in a year, effective for FY 2027 discharges beginning October 1, 2026. The proposal is intended to cap the share of a facility's payments coming from outlie…
- Standardized IPF Assessment and Measure Changes: cost, low. CMS proposes to implement a standardized IPF patient assessment instrument (IPF-PAI) as required by the Consolidated Appropriations Act, 2023, and to remove two IPF Quality Reporting Program measures: Alcohol Use Brief Intervention Provided or Offered (SUB-2/2a) and Tobacco Use Treatment Provided o…

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## Sources
- [2026-06675 on federalregister.gov](https://www.federalregister.gov/documents/2026/04/07/2026-06675/medicare-program-fy-2027-inpatient-psychiatric-facilities-prospective-payment-system-rate-update)
- [2026-06675 as published (PDF)](https://www.govinfo.gov/content/pkg/FR-2026-04-07/pdf/2026-06675.pdf)

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Source: PRIA, https://policyrisk.com/federal-register/2026-06675 (as of 2026-06-11).