How this is built, what it gets right, and where it is honest about being an estimate

The question the tool answers

If your hospital treated the exact same Medicare patients in FY2026 that it treated in 2024, what would CMS pay you, and how does that compare with FY2025 rates? Volume and coding are deliberately held constant, so every dollar of difference is attributable to what CMS changed: relative weights, standardized amounts, your wage index, and policy adjustments.

Sources, all public

• Caseload: CMS Medicare Inpatient Hospitals by Provider and Service, calendar 2024 (April 2026 refresh). Discharges and actual payments by hospital and MS-DRG.
• Weights and titles: IPPS Final Rule Table 5, FY2025 (correction notice version) and FY2026 (CMS-1833-F).
• Per-hospital factors: FY2025 and FY2026 IPPS Final Rule Impact Files: wage index, teaching and DSH adjustment factors, capital geographic adjustment, uncompensated care per-claim amounts, hospital-specific rates, cost-of-living adjustments, and proxy quality factors.
• Rates: National adjusted operating standardized amounts (Tables 1A/1B, full update column) and the capital standard federal rate (Table 1D), both years.

The payment model

Everything is recomputed in your browser from these inputs, which is why the scenario levers (volume, deductible, sequestration) are exact recalculations rather than approximations. Nothing you type leaves your machine; the tool is static files.

Validation

The operating base engine reproduces CMS pricer output to the dollar at the hospitals we tested: operating base totals, DSH, capital and uncompensated care match published pricer-derived figures exactly; FY2026 teaching add-ons match exactly. Nationally the model prices $80.6B (FY2025) against $70.3B actually paid on the same cases; the gap is almost entirely the Part A deductible (which the caseload file excludes by definition) plus 2% sequestration, and the Scenarios section converts gross to net receipts for exactly that reason. Year-over-year change is unaffected because the same offset sits in both years.

Where we deliberately differ from other tools

1. Retired spinal fusion DRGs are estimated, not dropped

Effective FY2025, CMS retired MS-DRGs 453, 454, 455, 459 and 460 and split the work into ten successor codes. Roughly 42,000 reported 2024 cases nationwide sit in the retired codes and cannot be repriced one-to-one. Most tools silently drop them. We estimate them: each retired code maps to its severity-matched successor set, and we blend successor weights using national successor-code volumes observed in the same caseload file (three successors are suppressed nationally; their shares are imputed from the observed multi-to-single-level ratio). The estimate is labeled wherever it appears and is never added to your headline numbers.

2. FY2026 reflects the CAA 2026 restorations

The Medicare-Dependent Hospital program lapsed September 30, 2025 and was reinstated through December 31, 2026 by the Consolidated Appropriations Act, 2026. Our FY2026 factors carry the restored hospital-specific rates. Tools built on the raw FY2026 rate files, which were published before the restoration, understate MDH hospitals.

3. A volume-weighted market average

Ranking hospitals by unweighted percent change lets a 67-case specialty hospital outrank a 6,000-case academic center. We show the unweighted rank because you will be compared on it, and the volume-weighted market average because it is the fairer number.

Which hospitals are covered, and which are not

This tool prices the 2,833 short-term acute-care hospitals paid under IPPS. Medicare pays several other kinds of hospital under entirely separate systems, so they are outside the model rather than missing from it. Facility type is determined from characters 3 to 6 of the CMS Certification Number, using CMS's own published ranges; CMS labels several of these "excluded from IPPS" in that same document.

• Critical access hospitals (1,385) are paid roughly 101% of allowable cost. There is no prospective rate to reprice, so a rate-impact model does not apply to them at all.
• Psychiatric hospitals (650) are paid under IPF PPS on a per-diem basis rather than per discharge.
• Inpatient rehabilitation facilities (415) are paid under IRF PPS using case-mix groups, not MS-DRGs.
• Long-term care hospitals (308) are paid under LTCH PPS using MS-LTC-DRGs.
• Children's hospitals (93) are excluded from IPPS and paid on a reasonable-cost basis. Rural emergency hospitals (52) receive a monthly facility payment.
• A further 289 short-term acute hospitals are IPPS-paid but cannot be priced here, either because they sit under Maryland's all-payer model or because every one of their 2024 DRG cells fell below the CMS suppression threshold.

Search for any of these by name and the tool will name the facility type and the payment system that covers it, rather than returning no result. Counts are from the CMS Hospital Enrollments file and move slightly as hospitals open, close and convert.

Known limits, read before you rely on anything

• Modeled gross amounts. Outlier payments, transfer and short-stay adjustments, new-technology add-ons, and direct medical education / organ acquisition pass-throughs are not modeled. The low-volume adjustment (up to 25% at qualifying small rural hospitals, also restored through 2026) is not yet modeled; if you qualify, these figures understate you.
• Every hospital is priced at the full update standardized amount. Quality program penalties to the update are not applied. The FY2025 teaching factor in the impact file reflects a different resident-count vintage than final pricer files (about 1% of IME at teaching hospitals). Quality adjustments use CMS proxy factors.
• The caseload file suppresses any hospital-DRG cell under 11 discharges, so low-volume, high-weight work is underrepresented. Expect counts below your internal numbers.
• Maryland is excluded (all-payer model outside IPPS). Traditional Medicare fee-for-service only; no Medicare Advantage, Medicaid or commercial.
• FY2026 rates take effect October 1, 2025. Calendar-year budgets see a blend of FY2025 and FY2026 rates.

Terms of use

Estimates, not advice. This tool produces analytical estimates from public CMS data. It is not accounting, reimbursement, billing, legal, actuarial or investment advice, and it is not a substitute for your own analysis. Verify every figure against the primary sources, the CMS pricer, and your own claims and remittance data before using it in any budget, filing, contract or board material. Where this tool and an official CMS publication disagree, CMS governs.

No warranty; no guarantee of payment. Provided as-is, without warranty of any kind. What Medicare actually pays you is determined by CMS and your MAC under the law in force on the date of service, and it will differ from these estimates.

Use and attribution. You are welcome to use this tool for your own hospital's internal analysis. If you circulate output, keep the attribution to A3HCS intact so downstream readers see the same limits you did. The presentation, code and compilation are the property of Advanced A3 Health Consulting; the underlying CMS data is public and not claimed.

Privacy. Calculations run in your browser. We do not use third-party analytics or advertising trackers on this page.

Advanced A3 Health Consulting (A3HCS) is not affiliated with, endorsed by, or acting on behalf of the Centers for Medicare & Medicaid Services or any other government agency. CMS data is used under its public-use terms. Hospital names and CCNs appear for identification only. Analysis prepared by A3HCS. Questions about methodology are welcome at a3hcs.org.