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LUGPA Policy Brief - Medicare Inpatient-Only (IPO) List Reform

March 2026

At-a-Glance Essentials

What’s Changing
The Centers for Medicare & Medicaid Services (CMS) finalized a policy in the 2026 Hospital Outpatient Prospective Payment System (OPPS) rule to phase out the Medicare Inpatient-Only (IPO) list by 2028, removing longstanding restrictions that required certain procedures to be performed only in hospital inpatient settings.

Why It Matters
The elimination of the IPO list represents a major step toward modernizing Medicare site-of-care policies, allowing physicians to determine the safest and most appropriate setting for surgical procedures based on patient needs rather than rigid regulatory classifications.

Action Points

  • LUGPA will continue working with CMS and policymakers to ensure the transition supports safe expansion of outpatient surgical care, including procedures relevant to urology.
  • We will also advocate for policies that support ambulatory surgery centers (ASCs) and physician-led outpatient care models.

LUGPA Impact

For LUGPA and community urology practices, the reform represents a meaningful advocacy victory, supporting physicians’ ability to deliver care in the most appropriate and efficient setting for patients.

Key Dates

  • 2000: CMS creates the Medicare IPO list.
  • 2021: CMS briefly moves to eliminate the list before reversing course.
  • 2026: CMS begins a multi-year phase-out of the IPO list.
  • 2028: CMS plans to fully eliminate the IPO list.

Background

The Medicare Inpatient-Only (IPO) list was created in 2000 by CMS to identify surgical procedures that Medicare would cover only when performed in a hospital inpatient setting. Procedures placed on the list were considered by the agency to require inpatient admission due to their complexity, expected recovery time, or risk to the patient.

When a procedure appeared on the IPO list, Medicare would not reimburse the service if it was performed in a hospital outpatient department or ambulatory surgery center (ASC). Hospitals were required to admit patients as inpatients in order to receive payment.

At its peak, the IPO list contained more than 1,700 procedures, limiting physicians’ ability to transition many services to outpatient settings even as medical technology and surgical techniques evolved.

LUGPA Advocacy

LUGPA has long advocated for reforms to the IPO list, arguing that it imposes unnecessary regulatory barriers that restrict physicians' clinical judgment and limit patient access to cost-effective care.

Through comments to CMS, coalition engagement, and ongoing advocacy efforts, LUGPA has emphasized that:

  • Advances in minimally invasive surgery and anesthesia have made many procedures safe in outpatient environments.
  • Site-of-care decisions should be driven by physicians and patient needs, not rigid federal lists.
  • Allowing procedures to migrate to outpatient settings can lower Medicare spending and reduce costs for patients.

CMS’ decision to phase out the IPO list reflects many of the concerns raised by physician groups and represents a significant policy shift toward greater flexibility in site-of-care decisions.

For LUGPA and community urology practices, this reform represents a meaningful advocacy victory that will allow physicians greater freedom to deliver care in the most appropriate setting.

Implications for Urology and Outpatient Care

Advances in surgical techniques and medical technology continue to expand the types of procedures that can safely be performed outside the hospital.

The continued growth of ambulatory surgery centers (ASCs) and other outpatient care models allows physicians to:

  • Deliver high-quality surgical care closer to patients
  • Improve scheduling flexibility and reduce delays in treatment
  • Lower overall healthcare costs
  • Provide more convenient recovery environments for patients

Healthcare market projections also point to a continued shift toward outpatient care. Industry analysts estimate that as many as 85% of procedures may be performed in outpatient settings by 2028, reflecting the broader transformation of the healthcare delivery system.

LUGPA’s Position

LUGPA supports CMS’ decision to phase out the IPO list and will continue working to ensure the transition strengthens access to safe, high-quality outpatient care.

Removing outdated site-of-care restrictions will help:

  • Expand patient access to timely surgical care
  • Reduce unnecessary healthcare spending
  • Encourage adoption of innovative medical technologies
  • Support physician-led community care models

LUGPA will continue engaging with CMS and policymakers to ensure that Medicare policies keep pace with clinical innovation and support patient-centered care delivery.