Transforming healthcare access: CMS finalizes groundbreaking changes for rural health clinics and FQHCs

The Centers for Medicare & Medicaid Services (CMS) have finalized a series of changes that promise to revolutionize billing and payment policies for rural health clinics (RHCs) and federally qualified health centers (FQHCs) in 2025. These modifications aim to enhance care delivery, improve financial sustainability and ultimately benefit patients in underserved communities.

These alterations encompass three main areas: revamping care coordination service reporting, introducing advanced primary care management services, and streamlining preventive vaccine billing. Each of these changes will significantly impact how RHCs and FQHCs operate, bill for services and care for their patients.

1. Revolutionizing care coordination service reporting

In a move toward greater transparency and accuracy, CMS finalized a fundamental change in how RHCs and FQHCs report care coordination services. This shift aims to clarify the services rendered and help ensure more precise reimbursement for healthcare providers.

Current practices and limitations

Presently, RHCs and FQHCs use a single HCPCS code, G0511, to report general care management services. This code encompasses a broad range of activities, including chronic care management and behavioral health integration services. While this approach has simplified billing to some extent, it has also led to a lack of specificity in reporting.

The current system allows for the reporting of 20 minutes or more of clinical staff time per calendar month under the G0511 code. These services are typically directed by RHC or FQHC practitioners, such as physicians, nurse practitioners, physician assistants or certified nurse-midwives. However, the use of a single code for various services has made it challenging to discern the exact nature and extent of care provided to patients.

Finalized changes and their implications

CMS’s changes aim to address these limitations by requiring RHCs and FQHCs to bill individual codes for the various components that currently make up the general care management HCPCS Code G0511. This change would effectively retire G0511 for use by these facilities, ushering in a new era of detailed service reporting.

List of individual codes that will be allowed to be reported in place of G0511

The transition to individual codes could potentially lead to a decrease in reimbursement for some facilities, particularly those that primarily furnish care management services that are less comprehensive than what G0511 currently covers. However, CMS has provided a solution to mitigate this potential financial impact: allowing RHCs and FQHCs to bill add-on codes for additional time spent on care management activities.

Benefits of the new reporting system

This change offers several advantages:

• Improved payment accuracy: By billing for specific services rendered, RHCs and FQHCs can help ensure they receive appropriate compensation for the exact care provided.
• Enhanced transparency for beneficiaries: Patients will gain a clearer understanding of the non-face-to-face services they are receiving, fostering trust and engagement in their care.
• Better data for healthcare planning: More detailed reporting will provide valuable insights into the types of care management services most frequently needed in rural and underserved communities.
• Potential for targeted care improvements: With more specific data available, healthcare providers and policymakers can identify areas where additional resources or training may be needed to enhance care delivery.

CMS is allowing for a six-month transition period, at least until July 1, 2025, to enable those RHCs/FQHCs to update their billing systems.

2. Introducing advanced primary care management services

Seeking to enhance preventive care and chronic disease management, CMS finalized the adoption of advanced primary care management (APCM) services for 2025. This new program aims to integrate various elements of existing care management and telehealth services into a comprehensive, patient-centered approach.

Understanding APCM services

APCM services represent a paradigm shift in how primary care is delivered and reimbursed in rural health settings. The program is designed to provide a more holistic and coordinated approach to patient care, particularly for those with chronic conditions. By combining various aspects of care management into a single, cohesive program, APCM services aim to improve patient outcomes while streamlining the administrative burden on healthcare providers.

The 3 new tiers of APCM services

CMS has provided three new codes to represent different levels of APCM services:

• G0556 (Level 1):
  • Target: Medicare patients with no more than one chronic condition
  • Estimated reimbursement: $10 per patient, per month
• G0557 (Level 2):
  • Target: Medicare patients with two or more chronic conditions expected to last at least 12 months or until death
  • Estimated reimbursement: $50 per patient, per month
• G0558 (Level 3):
  • Target: qualified Medicare beneficiaries with two or more chronic conditions
  • Estimated reimbursement: $110 per patient, per month

Payment structure and updates

The APCM services have a tiered payment structure based on the complexity of patient care needs. These payments will be made in addition to the RHC all-inclusive rate or FQHC prospective payment system rates. Importantly, CMS plans to update these payment amounts annually based on the physician fee schedule rates, ensuring that reimbursements remain aligned with the evolving costs of providing care.

Benefits of APCM services

The introduction of APCM services offers several advantages for both healthcare providers and patients:

• Comprehensive care coordination: By integrating various aspects of care management, APCM services promote a more holistic approach to patient health.
• Improved chronic disease management: The tiered system allows for more intensive management of patients with multiple chronic conditions, potentially reducing hospitalizations and improving quality of life.
• Enhanced preventive care: The program’s focus on regular patient engagement encourages more proactive and preventive healthcare practices.
• Financial stability for providers: The additional reimbursement for APCM services can help rural health clinics and FQHCs maintain financial viability while providing high-quality care.
• Patient-centered approach: By recognizing the varying needs of patients with different levels of health complexity, APCM services promote a more personalized care experience.

3. Streamlining preventive vaccine billing and payment

In a move to enhance public health efforts and improve financial processes for rural healthcare providers, CMS finalized significant changes to how RHCs and FQHCs bill and receive payment for Part B preventive vaccines. This initiative aims to address longstanding challenges in vaccine administration and reimbursement, potentially leading to more efficient and effective immunization programs in rural and underserved areas.

Current challenges in vaccine billing

Presently, RHCs and FQHCs face a cumbersome process when it comes to billing for influenza and pneumococcal pneumonia vaccines. These vital preventive services are not reported on billing claims at the time of service. Instead, facilities must engage in a complex reconciliation process at the end of the year through their cost reports. This system creates several issues:

• Delayed reimbursement: Facilities must wait until the end of the year to receive payment for vaccines administered throughout the year, potentially straining their financial resources.
• Administrative burden: The current system requires additional recordkeeping and reconciliation processes, adding to the already significant administrative workload of rural health providers.
• Potential for errors: The delay between service provision and reimbursement increases the risk of discrepancies and errors in reporting and payment.
• Cash flow challenges: RHCs and FQHCs must bear the upfront cost of purchasing and storing vaccines without immediate reimbursement, which can be particularly challenging for smaller facilities with limited financial resources.

Changes to vaccine billing and payment

To address these issues, CMS finalized a fundamental shift in how RHCs and FQHCs handle billing and payment for Part B preventive vaccines. The key elements include the following:

• Real-time billing: This will allow RHCs and FQHCs to bill for Part B preventive vaccines and their administration at the time of service, similar to other healthcare services they provide.
• Immediate payment: Facilities will receive payment for vaccines according to Part B preventive vaccine rates shortly after billing, rather than waiting for year-end reconciliation.
• Annual reconciliation: While immediate payment would be provided, an annual reconciliation process would still occur to ensure alignment with actual vaccine costs as reported on cost reports.

Benefits of the new vaccine billing system

This change offers several significant advantages:

• Improved cash flow: RHCs and FQHCs will receive timely reimbursement for vaccine costs, helping to alleviate financial pressures.
• Reduced administrative burden: Real-time billing aligns vaccine administration with other services, streamlining administrative processes.
• Enhanced accuracy: Immediate billing and payment reduce the risk of errors associated with delayed reporting and reconciliation.
• Incentive for vaccine programs: Timely reimbursement may encourage facilities to expand their vaccine offerings, potentially improving public health outcomes in rural areas.
• Better resource planning: With more immediate financial feedback, facilities can more effectively plan and allocate resources for vaccine programs.

CMS is allowing for a transition period of six months, until at least July 1, 2025, to enable those RHCs/FQHCs to be able to update their billing systems.

Embracing change for a healthier future

Significant transformation is on the horizon for rural healthcare delivery. These policy shifts are set to reshape the landscape of rural health services in 2025 and beyond.

The journey ahead will undoubtedly require adaptation, innovation and resilience from healthcare providers serving rural and underserved communities. However, the potential benefits — improved patient care, enhanced financial sustainability and more efficient healthcare delivery — make this transition not just necessary, but powerfully rewarding.

How Wipfli can help

Significant change is on the horizon for rural healthcare delivery, and these policy shifts are set to reshape the landscape in 2025 and beyond. For providers serving rural and underserved communities, adaptation and innovation will be key to success.

A partner like Wipfli can help you navigate the changing policy landscape and capitalize on these new developments to enhance the quality of care you provide and drive more successful outcomes. We have deep institutional knowledge of federal policy and dedicated advisors with hands-on experience who understand the unique challenges rural providers face. Learn how we can help rural healthcare providers and FQHCs.