rural health clinic 101 charles a. james, jr. president and ceo north american healthcare management...

Rural Health Clinic 101

Charles A. James, Jr.President and CEO

North American Healthcare Management Services

www.northamericanhms.com 888.968.0076

Presentation OverviewWhat is an RHC?Independent vs. Provider-Based RHCsRHC Location RequirementsRHC Billing and Reimbursement BasicsRHC Applications and Inspection ProcessBasic RHC Requirements RHC ManualRHC Resources


What is an RHC?Rural Health Clinics were established by the Rural Health Clinic Service Act of 1977 to address an inadequate supply of physicians serving Medicare beneficiaries in underserved rural areas, and to increase the utilization of nurse practitioners (NP) and physician assistants (PA) in these areas. RHCs have been eligible to participate in the Medicare program since March 1, 1978, and are paid an all-inclusive rate per visit for qualified primary and preventive health services.

(Medicare Benefit Policy Manual. Chapter 13. Section 10.1.)


What is an RHC?A Rural Health Clinic (RHC) is a clinic certified to receive special Medicare and Medicaid reimbursement. The purpose of the RHC program is improving access to primary care in underserved rural areas. The clinic must be staffed at least 50% of the time with a midlevel practitioner.

(Rural Assistance Center FAQ)


The Rules - 42 CFR 491

This is the Code of Federal Regulations(CFR) which stipulates rural health clinics’conditions for certification.

http://www.cms.gov/Regulations-and-Guidance/Legislation/CFCsAndCoPs/RHC_FQHC.html




42 CFR 491Compliance with Federal, State, and Local lawsLocation of ClinicPhysical Plant and EnvironmentOrganizational Structure Staffing and Staff Responsibilities Provision of Services Policy and Procedure ManualMedical RecordsAnnual Evaluation (vs. Quality Assurance)


Compliance with Federal, State, Local Laws

The clinic must be in compliance with federal RHC regulations and Medicare law. (J3)The clinic and staff are licensed pursuant to applicable State and local law. (J3 and J4)The clinic building meets applicable building and fire codes. (J5)


Who’s in charge – the State or the Feds?

Short Answer – BothThe State Department of Health typically perform inspections. They are an agent of CMS for the purpose of an RHC survey.

CMS interprets and enforces the federal RHC regulations. CMS approves or denies the state’s recommendations.


The RHC Encounter Rate

“In general, the all-inclusive rate (AIR) for an RHC or FQHC is calculated by the MAC/FI by dividing total allowable costs by the total number of visits for all patients. Productivity, payment limits, and other factors are also considered in the calculation.”

(Medicare Benefit Policy Manual. Chapter 13. Section 70.)


RHC Reimbursement

Currently, independent RHCs are capped at $79.80 for 2014. An average provider-based RHC encounter rate is between $140.00 – 167.00.


RHC Claims - Medicare Part A

Rural Health Clinic claims are administered by Medicare Part A. It is a Part B (Physician Service) benefit, using the structure of Medicare Part A.This is why we deal with UB04, Cost Reports, Revenue Codes, etc.


Medicare Part B (FFS)

In the RHC world, the term ‘Medicare Part B’ typically indicates those claims which will continue to be paid ‘fee-for-service’ and billed on a CMS-1500.

Non-RHC claims fall in this category.


Medicare Payments

“In general, Medicare pays 80 percent of the RHC or FQHC’s all-inclusive rate, subject to a per-visit payment limit. The beneficiary in an RHC must pay the deductible and coinsurance amount.”



Medicare Fees (Patient Charges)

“RHCs and FQHCs must charge Medicare beneficiaries the same rate that non-Medicare beneficiaries are charged.”



RHC Productivity Standard

1 FTE Physician – 4,200 Visits1 FTE NP or PA – 2,100 Visits

If the RHC or FQHC has furnished fewer than expected visits based on the productivity standards, the MAC/FI substitutes the expected number of visits for the denominator and use that instead of the actual number of visits.

(Medicare Benefit Policy Manual. Chapter 13. Section 70.4.)


Medicare Law

Rural Health Clinics are not special – we are all subject Medicare law, regulations, and policies.Some Medicare provisions do not apply to us.


Medicare DocumentationConsent to treatAuthorization to Bill HIPAA Privacy notification Medicare Secondary Payer Questions Asked

• Pub 100-5 Chapter 3, section 20 ABN issued if applicable

• when service does not meet medical necessity • Statutorily excluded Medicare services do not

require an ABN, I.e. physical, can give NEMB Surgical Consent


State Law and Medicaid

State medical practice laws, collaborative requirements, and Medicaid programs vary widely.Always check with state agencies and Medicaid offices before making any assumptions.


Independent RHCsIndependent RHCs are generally private physician offices or hospital clinics whose parent is > 50 beds. RHC encounters are paid using the current RHC cap.Independent RHCs must file an annual cost report, which is due 5 months after the end of each fiscal year. Failure to file timely cost reports can result in full refunds of RHC payments.


Provider-Based RHCsProvider-based RHCs (PBRHC) are those owned by, and fully integrated with, a parent entity such as a hospital, nursing facility, or home health agency.PBRHCs owned by a hospital with 50 beds or less qualify for an un-capped RHC rate.Claims are billed to the MAC which services the parent entity. PBRHCs whose parent entity is greater than 50 beds have the same cap as independents.PBRHCs rate is set under the parent entity’s cost report.


Provider-Based Requirements

Provider-based clinics are governed by CMS Program Memorandum A-03-030.This document delineates requirements for on-campus and off-campus (more than 250 yards from hospital campus) PB clinics.


Provider-based Criteria

LicensureClinical ServicesFinancial IntegrationPublic AwarenessObligations of hospital outpatient depts.Joint VenturesOff-site Clinics


Provider-based Clinic Definition

The PB-RHC IS an outpatient department of the hospital. In all manner – the RHC will be administered, operated, and financially integrated with the parent entity.


Provider-based Attestation

The purpose of the attestation is to demonstrate integration with the parent entity. Provider-based attestations are required if PB status provides a difference in payment. Provider-based attestations are required for off-site clinics.


RHC Location RequirementsRHCs must be located in one of the following:

Geographic-based Health Professional Shortage Area (HPSA)Population-based HPSAMedically Underserved Areas (MUAs)Governor Designated and Secretary certified area

The shortage area designation must have been updated within the past four years.


RHC Location Requirements

The clinic must also be located in a non-urban area according to the U.S. Census Bureau.

RAC ‘Am I Rural’ lookup tool:http://maps.rupri.org/circ/racrural/amirural.asp


http://maps.rupri.org/circ/racrural/amirural.asp

http://maps.rupri.org/circ/racrural/amirural.asp

RHC Inspections – Tier IV

Now that AAAASF has deemed status, RHCs are moved to Tier IV.RHCs are now Tier IV entities which places them on a very low priority for survey by the state.Most states are requiring new RHC applicants to pursue private accreditation.


Medicare 855A

Medicare will take at least 60 days to approve the 855A application.The clinic will receive an approval letter from CMS. Once the 855 is approved, the clinic can request the inspection.


RHC Physician Staffing Requirements

The clinic must have a designated medical director. A physician must be present in the clinic once every two weeks. The physician/medical director must see at least one patient and provide medical direction, consultation, and oversight.


RHC Mid-Level Provider (MLP) RequirementsA nurse practitioner, physician assistant, or certified nurse mid-wife must be employed by the RHC. The MLP must be available for patient at least 50% of posted patient hours.


RHC Approved Providers

Physicians – M.D. or D.O.Mid-level providers – N.P., P.A., or C.N.M.Mental Health Providers:

Clinical Psychologist – Ph.D.Licensed Clinical Social Worker(NO L.P.C. or C.P.C!)


Rural Health Services

• Physicians' services, as described in section 100;Services and supplies incident to a physician’s services, as described in section 110;Services of NPs, PAs, and CNMs, as described in section 120;Services and supplies incident to the services of NPs, PAs, and CNMs, as described in section 130;

(Medicare Benefit Policy Manual Chapter 13)


RHC Encounters are not:Visits for the sole purpose of obtaining or renewing a prescription, in which the need was previously determined are not covered services. Reviewing lab results.Administration of an injection.Time used in completion of claim forms. Care plan oversight (telephone) is not allowed by either Part A or Part B for RHC providers.


Physician ServicesThe term “physician” includes a doctor of medicine, osteopathy, dental surgery, dental medicine, podiatry, optometry, or chiropractic who is licensed and practicing within the licensee’s scope of practice, and meets other requirements as specified.



Qualified RHC Providers

An RHC encounter can be billed for the following providers:Physicians (MD, or DO)Nurse Practitioners, Physician Assistants, and Certified Nurse MidwivesClinical Psychologists (PhD)Clinical Social Workers (CSW or LCSW)


Provision of Incident-to ServicesIncident to services and supplies can be furnished by auxiliary personnel. More than one incident to service or supply can be provided as a result of a single physician visit. Incident to services and supplies must be provided by someone who has an employment agreement or a direct contract with the RHC or FQHC to provide services


Provision of Incident-to ServicesServices and supplies furnished incident to physician’s services are limited to situations in which there is direct physician supervision of the person performing the service. Direct supervision does not mean that the physician must be present in the same room…the physician must be in the RHC or FQHC and immediately available.

(Medicare Benefit Policy Manual. Chapter 13. Section 110.1)


Incident-to Services Defined Commonly rendered without charge or included in the RHC or FQHC bill; Commonly furnished in a physician office or clinic; Furnished under the physician’s direct supervision; and Furnished by a member of the RHC or FQHC staff. Drugs and biologicals that are not usually self-administered, and Medicare-covered preventive injectable drugs (e.g., influenza, pneumococcal); Bandages, gauze, oxygen, and other supplies; or Assistance by auxiliary personnel such as a nurse, medical assistant, or anyone acting under the supervision of the physician.


Incident-to Services Defined Incident-to services are considered covered and paid under the RHC. They must be bundled with the RHC encounter. They are not separately billable or payable.Services that do not occur on the same date as the encounter can be bundled if they occur 30 days before or after.The effect on payment is an increase in the charge, and therefore in the co-insurance.The cost for these services are included in the cost report, but are not separately payable on claims.


Examples of incident-to services

InjectionsSuture RemovalDressing ChangesPrescription ServicesBlood Pressure Monitoring


How to Bundle Services

Example: An office visit for $105.00 and an injection for $75.00 is provided by the physician, NP, PA, or CNM.

One line item for $180.00 will be submitted to Medicare. The patient (or secondary) will be responsible for $36.00 (20% co-insurance).


How RHC Medicare Services are Billed:

Type of RHC Encounter CLIA Lab Other Lab/Ancillary

Outside RHC Hours

Independent orFreestanding

Part A UB-04

Part B*Form 1500

Part B*Form 1500

Part B*Form 1500

Provider Based Part AUB-04

Billed by Parent hospital or absorbed into costs

Billed by Parent hospital/entity

Billed either Part B to MAC or as hospital charge if appropriate.

* Costs related to services reimbursed under Part B are carved out on the RHC cost report so that the encounter rate is not overstated (double-dipping).

Preventive Services - Billing

The IPPE and AWV are Medicare covered preventive services.These are RHC encounters. They should be billed with the HCPCS code on a UB04. There is no cost sharing (i.e. no patient deductibles or co-ins.) for IPPEs and AWVs.


Full RHC Regulation

This is the Code of Federal Regulations(CFR) which stipulates rural health clinics’conditions for certification.

Cut and Paste this into your browser:http://www.narhc.org/resources/rhc_rules_and_guidelines.php


Rural Health ResourcesNational Association of RHCs (NARHC)www.narhc.org

AAAASF - rhcaccreditation.org

Rural Assistance Center http://www.raconline.org/topics/clinics/rhc.php


http://www.narhc.org/

http://www.raconline.org/topics/clinics/rhc.php

http://www.raconline.org/topics/clinics/rhc.php

CMS and Medicare ResourcesCMS Rural Health Center – www.cms.gov/center/rural.asp

Online Manuals - www.cms.gov/Manuals/IOM/list.asp?listpage=1

Cahaba – www.cahabagba.com

WPS – Provider-Based Status FAQhttp://wpsmedicare.com/j5macparta/departments/audit_reimbursement/prbattestationsfaqs.shtml


http://www.cms.gov/center/rural.asp

http://www.cms.gov/Manuals/IOM/list.asp?listpage=1

http://www.cahabagba.com/

http://wpsmedicare.com/j5macparta/departments/audit_reimbursement/prbattestationsfaqs.shtml

http://wpsmedicare.com/j5macparta/departments/audit_reimbursement/prbattestationsfaqs.shtml

More CMS ResourcesMedicare Claims Processing Manual – UB04 Completion

www.cms.gov/manuals/downloads/clm104c25.pdf

Medicare Claims Processing Manual – Chapter 9 RHC/FQHC Coverage Issues

www.cms.gov/manuals/downloads/clm104c09.pdf

MedLearn Catalogwww.cms.gov/MLNProducts/downloads/MLNCatalog.pdf


http://www.cms.hhs.gov/manuals/downloads/clm104c25.pdf

http://www.cms.gov/manuals/downloads/clm104c25.pdf

http://www.cms.gov/manuals/downloads/clm104c09.pdf

http://www.cms.gov/MLNProducts/downloads/MLNCatalog.pdf

Contact InformationCharles A. James, Jr.North American Healthcare Management ServicesPresident and [email protected]


mailto:[email protected]

rural health clinic 101 charles a. james, jr. president and ceo north american healthcare management...

Documents

rhc reimbursement

rural health clinic

rhc program

rhc survey

federal rhc regulations

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underserved rural areas