Medicare Hospital Outpatient Payment Fairness Act of 1997 - Amends title XVIII (Medicare) of the Social Security Act to modify provisions added by the Balanced Budget Act of 1997 for a prospective payment system for covered hospital outpatient department (OPD) services. Provides that, if payment may be made under Medicare part B (Supplementary Medical Insurance) for similar services furnished outside the hospital setting, the total amount of payment for such covered OPD services shall be determined on the same basis as payment for such similar outside services.

Directs the Medicare Payment Advisory Commission to report to the Congress and the Secretary of Health and Human Services on whether the DRG (diagnosis-related group) weighting factors for DRGs associated with emergency care are adequate to cover the costs of emergency room use within discharges classified within such groups.

Directs the Secretary, taking such report into account, to make adjustments in such DRG weighting factors for discharges occurring on or after January 1, 2000, as may be appropriate to ensure that hospital emergency room costs attributable to Medicare patients are appropriately covered.