When the Centers for Medicare and Medicaid Services first introduced the idea of tying reimbursement to quality care for inpatients several years ago, it was only a matter of time until the practice would also apply to outpatient care. Right now, there is no requirement for hospitals paid under the outpatient prospective payment system to report quality data to CMS, but that will change as of fiscal year 2009. Under the inpatient prospective payment system, the annual payment update is linked to the collection of quality measures for treatment of acute myocardial infarction, asthma and heart failure, as required by the Medicare Modernization Act of 2003. Under IPPS, CMS created the Reporting Hospital Quality Data for Annual Payment Update program. Hospitals that do not comply with the program requirements receive a reduction to the IPPSS annual payment update. The proposal for mandatory reporting of outpatient-specific quality measures includes requiring facilities to comply with the IPPS program. According to CMS, quality measures reported for the FFY 2007 IPPS regarding inpatient hospital discharges reasonably represent the quality of care provided in the outpatient setting. CMS will accept this data as an interim step while quality measures specific to hospital outpatient care are being developed and refined.