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Rural Health Clinic Reimbursement Changes and Opportunities

On December 27, 2020, President Trump signed into law the Consolidated Appropriations Act (CAA), 2021. Included in this bill are comprehensive Rural Health Clinic reimbursement changes and provide possible new opportunities for both RHCs and hospitals.

Rural Health Clinic Medicare Rates

The most significant change included in the CAA was made to the RHC Medicare rates.

For independent and new RHCs certified after December 31, 2019, the RHC capped all-inclusive rates will increase from the current $87.52 per visit rate to a $100.00 per visit rate on April 1, 2021. The capped rates will steadily increase through 2028 to $190.00 per visit and in subsequent years the capped rate will be increased based on the Medicare Economic Index (MEI).

Current provider based RHCs, certified on or before December 31, 2019, will not be subject to the lower cap described in the previous paragraph. Instead, these provider based RHCs will be grandfathered and set a capped rate per visit based on clinic services furnished in 2020. Once the rate is determined, they will receive a yearly percentage increase based on the MEI.

New Opportunities 

Prior to the CAA, one of the requirements for provider based RHCs to received uncapped per visit rates was the hospital needed to remain under 50 beds. Because of the 50-bed requirement and the lower capped reimbursement rates, many larger hospitals did not consider provider based RHCs.

With the passing of the CAA, all new RHCs will be subject to the newly published higher capped rates, regardless of a hospitals bed count. Therefore, hospitals operating with greater than 50 beds may want to consider establishing provider based RHCs if the clinic meets all the RHC requirements.

As a result of this new provider-based opportunity for RHCs, hospitals participating in the 340B Drug Pricing Program may also have an opportunity for additional 340B savings.

If your facility has any questions or would like assistance dealing with the Rural Health Clinic reimbursement changes or identifying new opportunities, please contact the individuals listed below:

Please note, with all new legislation, there are corrections and further guidance that still needs to be issued by the Centers for Medicare & Medicaid Services (CMS). The information provided above is based on the latest current language in the Consolidated Appropriations Act, 2021.

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