CMS proposes 2027 dialysis rule: base rate $299.55, phosphate binders folded in, low-volume adjustment widened to 8,000 treatments

The big number in the 2027 dialysis rule is 1.1%. That is CMS’s projected overall increase in Medicare payments to ESRD (end-stage renal disease) facilities if its proposed rule, CMS-1846-P, is finalized as written [1, 2]. It is a smaller story than the $299.55 base rate suggests, and the gap between the two is the part worth understanding.

What changed

CMS issued the proposed CY 2027 ESRD Prospective Payment System (PPS) rule on June 24, and it was published in the Federal Register on June 26 [1, 2]. It would apply to services on or after January 1, 2027 [1]. The proposed per-treatment base rate is $299.55, up $17.84 from $281.71 in 2026. The same rate would apply to dialysis for acute kidney injury (AKI) [1, 2].

CMS reaches that figure by adding $15.96 for phosphate binders to the 2026 rate, applying two budget neutrality factors (1.00267 for the wage index and 0.98783 for several adjustment changes), and then a 1.6% market basket update [2]. The 1.6% is a 2.6% market basket increase less a 1.0 percentage point productivity adjustment [2]. CMS estimates Medicare would pay about $6.2 billion to roughly 7,600 facilities in 2027, with hospital-based facilities up 2.0% and freestanding facilities up 1.1% [1, 3].

Comments are due August 24, 2026 [2].

How does Medicare pay dialysis facilities today?

Medicare has paid for outpatient dialysis with one bundled per-treatment rate since January 1, 2011. That system, the ESRD PPS, comes from section 1881(b)(14) of the Social Security Act, added by section 153(b) of the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA) [2]. The base rate is adjusted for patient case mix and the local wage index, then for six add-ons: home and self-dialysis training, high-cost outliers, a transitional add-on for new drugs (TDAPA), one for new equipment and supplies (TPNIES), a pediatric add-on, and a post-TDAPA add-on [2]. CMS resets these every year. The last final rule, for 2026, appeared in the Federal Register on November 24, 2025 [2].

Oral-only drugs were first due to enter the bundle in 2014. Congress pushed that date back several times, and phosphate binders finally came under the ESRD PPS on January 1, 2025 [2]. Since then, Medicare has paid for them through TDAPA at 100% of average sales price (ASP), plus a flat $36.41 per monthly claim for the cost of handling them [2]. CMS said at the time that it would later fold the drugs into the base rate. It did the same with calcimimetics, which were paid through TDAPA starting in 2018 and moved into the base rate on January 1, 2021 [2].

Who it affects

The rule covers freestanding and hospital-based dialysis facilities alike [1]. Four groups see changes beyond the base rate.

Small facilities get a wider low-volume payment adjustment (LVPA). CMS created the LVPA in its 2011 rule at 18.9% for facilities under 4,000 treatments a year, raised it to 23.9% for 2016, and for 2025 split it into two tiers: 28.9% for a three-year median under 3,000 treatments and 18.3% for 3,000 to 4,000 [2]. In 2025, 342 facilities received it [2]. CMS now proposes an 8,000-treatment ceiling with six tiers, still set by the three-year median. Facilities under 3,000 treatments would get the largest adjustment, and CMS says its analysis supports 5.0% for the 7,000-treatment tier [1, 2]. CMS estimates the change adds about 1.6% for facilities under 3,000 treatments and 0.1 percentage point or less for independent and hospital-based facilities as groups [2].

Home and self-dialysis programs would see the training add-on rise from $95.60 to $138.22, and CMS would allow it during the first 120 days of dialysis, when it is not paid now [2]. The add-on has been $95.60 since 2017. Medicare paid about $7 million in training add-ons in 2025, a flat trend that CMS links to underused home dialysis [2].

Pediatric programs lose the temporary pediatric add-on, which paid 30% more per treatment for 2024 through 2026 and ends December 31, 2026. CMS proposes new case-mix adjusters for children, and would let facilities receive the LVPA for pediatric patients [2]. Children accounted for about 0.16% of Medicare dialysis treatments in 2024 [2].

Facilities that treat patients on the new drugs DefenCath and Vafseo are affected through the TDAPA changes described below [2].

What it means for your practice

Start with phosphate binders. CMS proposes to end separate TDAPA payment and add a permanent $15.96 to the base rate. That amount is built from April through December 2025 claims at 100% of ASP, plus 6% for operating costs, less 1% for outliers [1, 2, 3]. CMS weighed carrying the $36.41 monthly flat rate into the base instead. Over the same nine months, that approach would have totaled about $25.9 million in operating costs, against $16.2 million under the 6% approach CMS chose [2]. So part of the $17.84 rise is not new money. CMS estimates that about $430 million in 2026 TDAPA payments for DefenCath, Vafseo and phosphate binders ends, a 5.5% drop in 2027 payments, offset by a 5.3% rise from the binder base rate and 2.0% from post-TDAPA add-ons [2].

Outlier payments are the second moving part. CMS proposes raising the adult fixed dollar loss amount from $14.80 to $114.98 and the adult Medicare allowable payment from $23.68 to $41.28 [2]. In plain terms, a case has to cost much more before outlier money flows. Binders would also become outlier-eligible services on January 1 [2]. CMS projects that the outlier changes lower aggregate payments by about 1.9%, or $150 million, and attributes them mainly to TDAPA drugs becoming outlier services [1, 2].

A rough sense of scale, using only the base rate and ignoring case-mix, wage index and outliers: a facility furnishing 10,000 treatments would see a base-rate difference of $178,400 a year ($17.84 times 10,000). Treat that as arithmetic on one input, not a forecast, because it leaves out the drug payments and outlier effects above. That facility would also be just over the proposed 8,000-treatment LVPA ceiling, so it would get no low-volume adjustment, while one furnishing 7,500 treatments might [2].

The LVPA is not automatic. A facility has to attest that it qualifies, and the usual deadline is November 1, which for 2027 payment falls on November 1, 2026 [2]. CMS notes that many facilities above 4,000 treatments have never attested and asks for comments on delaying the effective date or accepting late attestations. It has not proposed either [2].

Post-TDAPA add-on amounts would also be recalculated quarterly and published through change requests rather than set once a year. CMS lists estimated per-treatment amounts of $5.5951 for DefenCath and $0.9437 for Vafseo [2].

What to do now

• Count your treatments. Eligibility requires staying under the threshold in each of the last three cost reporting years, and the tier uses the median, so check your 2023 to 2025 volume against the proposed structure [2].
• Rebuild your 2027 revenue model with $299.55, the new outlier thresholds and no separate binder payment [1, 2].
• If you run a home program, look at how many training sessions fall in a patient’s first 120 days [2].
• If you might newly qualify for the LVPA, prepare an attestation for the November 1, 2026 deadline unless the final rule changes it [2].
• Look at the quality incentive program changes. Starting with payment year 2029, CMS would replace the Hypercalcemia reporting measure with a Hyperphosphatemia clinical measure, and drop the medication reconciliation and COVID-19 healthcare personnel vaccination reporting measures [2].
• Comment by August 24 on CMS-1846-P at regulations.gov [2].

When will CMS finalize the 2027 dialysis rule?

The proposed rule does not set a date. The 2026 version was published in late November [2]. CMS says it will update the market basket, wage index, outlier thresholds and the training add-on wage figure with newer data in the final rule, so the final base rate and training add-on could differ from $299.55 and $138.22 [1, 2].

The policy fight

No provider or patient group had published a response to the proposal that this report could find as of July 1. The rule itself records earlier disagreement over the low-volume design. Commenters on a 2024 request for information opposed an 8-tier structure, some raising concerns about the budget neutrality factor and others saying the adjustment factors for the lowest-volume tiers were too high and the top tiers’ too small. CMS says it dropped the 1,000 and 2,000 treatment tiers in response, and disagrees that the highest tier’s factor is minuscule [2]. MedPAC and the Government Accountability Office had pushed CMS to target the LVPA at facilities that matter for access in isolated areas and warned that a hard treatment cutoff invites facilities to cap volume. CMS says its own analysis did not find higher costs for isolated low-volume facilities [2].

The proposal is budget neutral, so facilities above the threshold carry some of the cost: CMS says the LVPA, pediatric and training changes together lower the base rate by about 1.1%, roughly $3 [1, 2]. That is a change from 2025, when CMS kept the tier change inside the LVPA so that it cost other facilities nothing [2].

CMS also asks open questions on home dialysis uptake, palliative dialysis and alternative dialysis schedules, which it says could inform future policy [2].