Company: THC
Filing Date: 2025-07-30
Form Type: 10-Q
Source: 0000070318-25-000039
Chunk: 80

Company: TENET HEALTHCARE CORP
Filing Date: 2025-07-30
Form: 10-Q
Item: Part I, Item 2
Chunk 80
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Regulatory and Legislative Updates

Material updates to the information set forth in our Annual Report about the Medicare and Medicaid payment systems, as well as other government programs impacting our business, are provided below.

Proposed Payment and Policy Changes to the Medicare Inpatient Prospective Payment Systems—Section 1886(d) of the Social Security Act requires CMS to update Medicare inpatient FFS payment rates for hospitals reimbursed under the inpatient prospective payment systems (“IPPS”) annually. The updates generally become effective October 1, the beginning of the FFY. In April 2025, CMS issued proposed changes to the Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals and Fiscal Year 2026 Rates (“Proposed IPPS Rule”). According to CMS, the combined impact of the proposed payment and policy changes in the Proposed IPPS Rule for operating costs will yield an average 3.4% increase in Medicare operating payments for propriety hospitals in FFY 2026.

Proposed Payment and Policy Changes to the Medicare Outpatient Prospective Payment and Ambulatory Surgery Center Payment Systems—In July 2025, CMS released the proposed policy changes and payment rates for the Hospital Outpatient Prospective Payment System (“OPPS”) and Ambulatory Surgical Center Payment System for Calendar Year (“CY”) 2026 (“Proposed OPPS/ASC Rule”). CMS projects that the impact of the payment and policy changes in the Proposed OPPS/ASC Rule will yield an average 0.7% net increase in Medicare FFS OPPS payments for propriety hospitals in CY 2026. The proposed net increase includes a reduction in overall Medicare FFS OPPS payments for propriety hospitals due to CMS’ proposal to revise its November 2023 final rule entitled Hospital OPPS: Remedy for 340B-Acquired Drug Payment Policy for CYs 2018‑2022. In the prior rule, CMS proposed a reduction in non-drug items and services by 0.5% per year until the prescribed payment reduction total had been recouped in full. This revised 340B remedy provision in the Proposed OPPS/ASC Rule updates the annual offset percentage for non-drug items and services from 0.5% to 2.0% starting in CY 2026; CMS 

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estimates this increased offset will remain in effect until CY 2031. In addition, CMS projects that the impact of the payment and policy changes in the Proposed OPPS/ASC Rule will yield an average increase of 2.