Deadline to Review Medicare Wage Index for FY 2027
It’s that time of year for Medicare PPS hospitals to review their wage index data.
PPS Hospitals are paid based on a standard Federal rate that is adjusted by a wage index factor to reflect the relative wage levels in a geographical area. This wage index is updated annually and is a key factor for Medicare hospital reimbursement rates which has a significant impact on hospital realization and revenue. The period this project is impacted upon is 10/1/26 – 9/30/27.
Hospitals have until September 2, 2025 to submit Worksheet S-3 wage data revision requests to their Medicare Administrative Contractor (MAC).
There are several factors to keep in mind when preparing these annual worksheets. Some key areas that hospitals should focus on include but are not limited to:
- Total hours should exclude non-worked hours such as earned time
- Physician and Advanced Practice Provider (APP) professional vs. provider components
- Wage related costs
- Patient Care contract labor
- Administrative contract labor
Be sure to review CMS’s FFY 2027 website for further changes and guidance.
For more information or a discussion on how this may impact your hospital, please contact Marc Levy or your BNN advisor at 800.244.7444.