LUGPA Policy Brief: NY A.2140‑A (Site‑Neutral Payment Proposal)

June 2026

At-a-Glance Essentials

What’s Changing

NY A.2140‑A, which did not advance during the 2026 legislative session, would have capped commercial reimbursement for designated outpatient services at 150% of Medicare’s non‑hospital rates, including physician fee schedule (PFS) and ambulatory surgery center (ASC) payments.

Why It Matters: Medicare rates already fall short of covering the real cost of specialty care. Extending those inadequate benchmarks into the commercial market would have destabilized independent urology practices, accelerated consolidation into hospital systems, and reduced patient access to community‑based care.

Executive Summary

NY A.2140‑A aimed to control healthcare costs by tying commercial reimbursement for certain outpatient services to Medicare’s non‑hospital payment rates. While well‑intentioned, the bill relied on a payment structure that already underfunds specialty care and fails to reflect the true cost of delivering complex urologic services in outpatient and ASC settings.

Although the bill failed to advance during the 2026 legislative session, it highlights a growing policy debate over site-neutral payment reforms and the use of Medicare benchmarks in the commercial insurance market.. Its failure preserves access to efficient, community‑based urology care and avoids a rigid statewide cap that could have expanded over time.

Background

Independent urology practices provide comprehensive, lower‑cost specialty care across New York, including cancer treatment, chronic disease management, and minimally invasive procedures. These practices already face rising expenses in areas such as staffing, supplies, technology, and regulatory requirements. Meanwhile, Medicare reimbursement continues to fall further behind inflation.

A.2140‑A would have:

• Imposed a statewide cap on commercial reimbursement at 150% of Medicare’s non‑hospital rates
• Replaced negotiated private contracts with a government‑mandated ceiling
• Applied the cap to services commonly performed in office‑based and ASC settings
• Added new administrative, compliance, and audit burdens

This approach would have disproportionately harmed the very settings that deliver high‑quality, lower‑cost care.

Relevance to Urology and Independent Practices

For independent urology groups, this bill posed several risks:

• Reduced services and investment: Practices may be forced to scale back services, delay technology upgrades, or limit ASC‑based procedures.
• Accelerated consolidation: Lower outpatient reimbursement would push more care into hospital systems, where costs are significantly higher due to facility fees and cross‑subsidization.
• Patient impact: Reduced access, longer wait times, fewer local options, and diminished availability of minimally invasive outpatient procedures.
• Administrative burden: Compliance mandates and civil penalties would fall hardest on independent practices without hospital‑level infrastructure.

Conclusion

NY A.2140‑A attempted to address affordability but would have done so by suppressing reimbursement in the very settings that deliver efficient, patient‑centered care. The bill's failure preserves flexibility in commercial contracting and avoids additional financial pressure on independent physician practices. This is a meaningful win for independent urology, preserving access, protecting practice viability, and preventing further consolidation into higher‑cost hospital systems. LUGPA remains committed to working with lawmakers on balanced reforms that improve affordability without undermining community‑based specialty care.