Unraveling reform: SDoH and health equity changes in the 2026 proposed rule

The proposed ruleopens in a new tab for fiscal year (FY) 2026 by the Centers for Medicare & Medicaid Services (CMS) signals a significant shift in federal healthcare priorities, particularly regarding the role of social determinants of health (SDoH) in quality reporting and payment models. 

CMS proposes removing several SDoH-related quality measures from some key programs, citing concerns about the administrative burden and costs associated with manual screening processes, data storing, staff training and workflow adjustments. Additionally, reporting and aggregating SDoH data has not provided a direct correlation to improved patient outcomes from these screenings. By removing these measures, the intent is to enable hospitals to allocate resources to measuring clinical outcomes more effectively. 

This does not refute the evidence of a direct relationship between socio-economic factors and medical outcomes; with the proposed rule, we see a refocus from data capture to “measurable clinical outcomes” and preventive health measures.

Here are three things included in the proposed changes:
 

1. Scaling back inpatient quality measures and SDoH items over the next few years

CMS proposes removing the below quality measures, beginning with the 2024 reporting period/FY 2026 payment determination (including two SDoH measures recently introduced with the FY 2023 Final Rule):

• Facility commitment to health equity
• Screening for social drivers of health 
• Screen positive rate for social drivers of health 

In addition, for inpatient rehabilitation and skilled nursing facilities, four SDoH items would become optional in 2025 and be fully removed by 2028:

• One item for “living situation”
• Two items for “food”
• One item for “utilities”
   

2. Expanding SDoH screening into outpatient settings next year

CMS proposes making outpatient reporting mandatory in 2026. This move aims to capture a more complete picture of patients’ social risks across care settings, focusing on domains such as food insecurity, housing, utilities, transportation and personal safety. However, the broader policy context suggests a tension: While outpatient SDoH data collection is increasing, the removal of SDoH measures from inpatient quality programs may limit the integration of social risk data into payment and performance evaluation. 
 

3. Shifting focus from data collection to outcomes

This “unraveling reform” reflects a recalibration — moving away from broad, resource-intensive SDoH mandates toward a more targeted, data-driven approach that prioritizes clinical outcomes and administrative efficiency. However, the proposed rule lacks guidance on how this will be achieved. 
 

Uncertainty for SDoH 

The proposed rule changes for FY 2026 mark a significant milestone in quality reporting for SDoH. The evolving landscape of healthcare policy emphasizes the importance of balancing administrative efficiency with comprehensive patient care. With fewer data requirements in inpatient settings and more in outpatient settings, the result is a complex landscape where the future role of SDoH in federal healthcare policy remains contested and subject to further evolution. 

So, what can organizations do today? While the future of SDoH remains uncertain, there are some things we know right now: 

1. The CMS rule is currently proposed so the requirements haven’t changed yet. 
2. SDoH significantly impact patient outcomes by influencing various aspects of an individual's health. Rolling back SDoH measures would not diminish the importance of data capture because SDoH data can inform organizations’ efforts to advance health equity and improve patient outcomes. 
3. With the proposed rule changes, we anticipate that the key measures going forward will correlate improvements in patient outcomes resulting from the SDoH data collection. 
4. Automating SDoH data capture and codingopens in a new tab can help alleviate administrative burden. 

The journey toward integrating SDoH into healthcare practice is complex, but it is essential for fostering a more equitable and effective healthcare system. By embracing targeted and data-driven approaches, providers can enhance the quality of care while ensuring that the socio-economic context of patients remains a central consideration in clinical decision-making. As policies continue to evolve, the focus must remain on delivering holistic care that addresses both clinical and social needs, ultimately advancing the goal of health equity for all.

Michelle Badore is an international content development manager at Solventum.

Tiffany Harman, RN, MSN, is the global coding and clinical content manager at Solventum.