The Centers for Medicare & Medicaid Services (CMS) proposed a wide rollback of the baseline rules hospitals, nursing homes and other providers must meet to bill Medicare and Medicaid on 5 November 2026. The proposed rule, called the Cutting Administrative Requirements for Excellence in Patient Care rule, or CARE, revises the Conditions of Participation, Conditions for Coverage and Requirements for Participation after a review of all 21 provider and supplier types. CMS estimates the changes would save $320 million a year and return more than 3.26 million hours of staff time to providers.
What the Proposal Removes for Hospitals
The largest changes fall on hospitals. CMS would remove the staff training requirements for transfer protocols and emergency services readiness, both in effect since 1 July 2025, and the obstetric care staff training requirement, which was due to take effect on 1 January 2027. It would also remove the obstetric-specific quality assessment and performance improvement requirements due on the same date. The obstetric standards were created in the 2025 outpatient payment rule to close gaps in training, staffing, transfer protocols and emergency readiness, and the organisation and staffing standards from that rule would stay in place.
CMS said the ongoing burden of the training requirements outweighs their benefit, and pointed to other rules that still apply, including written transfer policies, the Emergency Medical Treatment and Labor Act, accreditation standards and quality improvement requirements. The 2025 outpatient rule had estimated that the emergency services readiness training alone would cost hospitals about $173 million and 1.6 million staff hours a year.
One new hospital requirement would be added. Hospitals and critical access hospitals that provide obstetric care would need informed consent standards for birth tissue collection, including the placenta and cord tissue, and policies for families who request their birth tissue for cultural, religious or personal reasons. CMS cited an advocacy group estimate that birth tissue procurement organisations collect about 100,000 placentas a year, and said these tissues are often marketed to the public in misleading ways.
Critical Access Hospitals and Distance Rules
Critical access hospitals would see the same removals of emergency services readiness and obstetric training requirements, and the same obstetric quality improvement requirements would go. The rule would also put into effect Section 241 of the Consolidated Appropriations Act of 2026, which exempts certain critical access hospitals from the distance requirements they must meet to keep their status. The exemption covers hospitals designated as of 1 January 2024 that received a CMS noncompliance notice between 1 December 2024 and 1 January 2026. CMS identified four facilities that qualify, and said the exemption is not time-limited.
The rule would also make permanent the current CMS policy of measuring distance only to hospitals that provide acute inpatient care or to other critical access hospitals, rather than to any hospital.
Nursing Homes and Other Care Settings
Nursing homes and intermediate care facilities for people with intellectual disabilities would no longer have to educate staff about the COVID-19 vaccine, offer it to them or document those actions. Nursing homes' continuing respiratory illness reporting would end, although reporting would still be required during a future public health emergency declared by the health secretary. Requirements for the COVID-19 vaccine for residents and clients would be streamlined rather than removed.
Existing nursing home facilities would be exempt from the standards that limit resident rooms to two residents and require each room to have its own bathroom. CMS said the renovations needed to meet these standards can discourage new operators from reopening older buildings. Rural emergency hospitals would lose expired COVID-19 and seasonal influenza reporting requirements and staff vaccination rules, along with data reporting requirements during a public health emergency.
Building Standards and Medicaid Reporting
The rule would update physical environment standards, adopting the 2024 editions of the National Fire Protection Association Life Safety Code and Health Care Facilities Code, along with the 2022 emergency and standby power systems codes. It would also remove the requirement that patient care areas have access to natural light and ventilation through exterior windows and doors, for hospitals, critical access hospitals, nursing homes, hospices and other providers with similar rules.
On the payment side, CMS would rescind the requirement that states report the share of Medicaid nursing facility and intermediate care facility payments spent on pay for direct care workers and support staff. The requirement came from the 2024 nursing home staffing rule, and CMS estimates that rescinding it would save providers $30.4 million a year. Nursing homes would see the largest share of the total savings, at $142.6 million a year, followed by hospitals at $123.2 million, critical access hospitals at $16.6 million and intermediate care facilities at $6.6 million.
Why This Matters for Healthcare Organizations
This is a proposed rule, not a final one, so nothing changes yet. CMS is accepting comments through 9 January, and it is also asking for views on topics it has not yet proposed changes on, including loosening physician supervision of certified registered nurse anesthetists, widening the scope of practice for nurse practitioners and physician assistants in nursing homes, lowering barriers to certifying new transplant programmes, and future policies for the Medicaid institutional workforce.
For hospitals and nursing homes, the practical step now is to read the proposal against their own compliance work and decide what to say in a comment. The training, reporting and room standards the rule would remove are real costs today, and the proposal is the chance to weigh in before CMS finalises it.
Analysis: Fewer Prescriptive Rules, More Reliance on Other Safeguards
The proposal rests on a clear argument: that prescriptive training and reporting rules cost more staff time than they return in safety, and that other safeguards, from written transfer policies to accreditation and the Emergency Medical Treatment and Labor Act, can carry the weight instead. That argument is strongest where the burden is well documented, as with the emergency readiness training. Hospital groups pushed back when the obstetric standards were first proposed in 2024, with the American Hospital Association saying at the time that it was deeply concerned the agency was using the conditions of participation to advance its policy agenda, so the debate over these standards is not new.
The new birth tissue consent requirement shows the rule is not a straight cut. CMS is adding a patient-rights protection in the same document that removes training rules, which suggests the agency is picking which requirements earn their place rather than clearing the board. Providers should treat the comment period as the real decision point, since the final rule can still change substantially from what was proposed.
Clinics reviewing how front-desk and patient communication work can be handled can explore MedClinicX's AI patient portal, see how after-hours calls are handled on our AI medical receptionist page, or explore the demos and request a quote. For related coverage, see our earlier article on CMS finalising the 2027 outpatient payment rule.
Sources and References
- Centers for Medicare & Medicaid Services — Medicare and Medicaid Programs; Cutting Administrative Requirements for Excellence in Patient Care (CARE) (CMS-3484-P), 5 November 2026: https://www.cms.gov/newsroom/fact-sheets/medicare-medicaid-programs-cutting-administrative-requirements-excellence-patient-care-care-cms-3484
- Federal Register — Medicare and Medicaid Programs; Cutting Administrative Requirements for Excellence in Patient Care (CMS-3484-P), public inspection document 2026-22812, 5 November 2026: https://www.federalregister.gov/public-inspection/2026-22812/medicare-and-medicaid-programs-cutting-administrative-requirements-for-excellence-in-patient-care
- Becker's Hospital Review — CMS proposes broad rollback of conditions of participation: 11 notes, 5 November 2026: https://www.beckershospitalreview.com/legal-regulatory-issues/cms-proposes-broad-rollback-of-conditions-of-participation-11-notes/
- Bloomberg Law — CMS Seeks to Loosen Some Requirements for Providers, Suppliers, 5 November 2026: https://news.bloomberglaw.com/health-law-and-business/cms-seeks-to-loosen-some-requirements-for-providers-suppliers
Reporting based on the sources above, accessed 6 November 2026. The CMS fact sheet and the Federal Register notice were read directly, and the Becker's Hospital Review and Bloomberg Law reports were read directly and cross-checked against them. MedClinicX did not conduct original reporting or interviews for this article. Corrections: contact us via https://medclinicx.com/contact