Rural Health Clinics Secure Major Regulatory Wins in Medicare Physician Fee Schedule Final Rule

NARHC Washington, D.C.

On November 1, the Centers for Medicare and Medicaid Services (CMS) issued the CY 2025 Medicare Physician Fee Schedule (MPFS) Final Rule. NARHC is very pleased to report that the rule finalizes several Rural Health Clinic (RHC) specific policy proposals, as well as other provisions with positive implications for the RHC community, including:

• Allowing RHCs to bill for administration of Part B preventive vaccines (COVID-19, pneumococcal, influenza, and Hepatitis B) at time of service, not entirely in a lump sum settlement on cost report, beginning July 1, 2025
• Eliminating RHC productivity standards for cost report periods ending after December 31, 2024
• Completely revising RHC care management billing with the elimination of the G0511 consolidated code
  • Establishing new “Advanced Primary Care Management Services” billing opportunities
• Removing Hemoglobin/Hematocrit and examination of stool specimens for occult blood from the list of required RHC lab services
• Clarifying guidance versus regulatory discrepancies in how “primarily engaged in primary care” is defined and enforced
• Expanding same-day billing flexibilities for dental services able to be furnished in RHC setting
• Modifying Intensive Outpatient Program (IOP) Services payment to allow for reimbursement of three and four-service days
• Extending Medicare telehealth flexibilities until December 31, 2025

“These significant regulatory changes for RHCs were the direct result of NARHC advocacy and a CMS-willingness to listen to, and address, Rural Health Clinic concerns,” said Sarah Hohman, NARHC Director of Government Affairs. “We thank the many RHCs, and other organizations committed to the advancement of rural health who reiterated NARHC’s comments in their own submissions, all who helped us get these proposals across the finish line and into the final rule.”

The majority of these policies will go into effect January 1, 2025, unless otherwise specified below. Keep reading for a full analysis of what was finalized, what was not finalized, and what we’ll be advocating for in the future!

Visit our technical assistance webinar page to view past and upcoming webinars and to register for the upcoming webinar: RHC Regulatory Changes in 2025 - Medicare Physician Fee Schedule Updates You Need to Know

Medicare Vaccine Reimbursement Changes
Background
RHC statute requires that flu, COVID-19, and pneumococcal vaccines and their administration to Medicare patients be reimbursed at 100% of reasonable costs, instead of the 80% limit that applies to other services. The hepatitis B vaccine has historically been reimbursed as part of the RHC All-Inclusive Rate, however no insurance or deductible applies given that it is a preventive service.

This can result in cash flow issues due to the wait time between purchasing and administering vaccines and the cost report settlement.

What CMS Finalized
CMS heard these concerns and is finalizing a proposal to allow RHCs to bill for the administration of pneumococcal, flu, COVID-19, and hepatitis B vaccines at time of service.

These claims will initially pay like other Part B vaccine claims, at 95% of the Average Wholesale Price (AWP) for the vaccine product itself. Vaccine administration will be reimbursed according to the Part B Vaccine Administration National Fee Schedule, shown below, adjusted for locality. The files for geographic adjustments can be found at the bottom of the page here.

Vaccine Administration Reimbursement:
G0008 (Flu) -- $33.71 (unadjusted)
G0009 (Pneumo) -- $33.71 (unadjusted)
G0010 (Hep B) -- $33.71 (unadjusted)
90480 (COVID-19) -- $44.95 (unadjusted)

To comply with the statutory requirements of paying 100% of reasonable costs for preventive vaccines however, RHCs will still reconcile with CMS on an annual basis to receive their full vaccine and administrative costs.

Additionally, CMS is making certain RHC providers eligible to bill HCPCS code M0201 when one of these four vaccines is administered in a patient’s home. This is approximately a $39.90 (unadjusted) additional reimbursement. To meet the criteria for receiving the in-home additional payment, RHCs must be in a designated home health shortage area and offer visiting nurse services, and the visit must also meet the requirements outlined below:
(A) The patient has difficulty leaving the home or faces barriers to getting a vaccine in settings other than their home.
(B) The sole purpose of the visit is to administer one or more preventive vaccines.
(C) The home is not an institution that meets the requirements of sections 1861(e)(1),1819(a)(1), or 1919(a)(1) of the Act, or §§ 409.42(a) of this subchapter.

To ensure CMS has time to issue new cost reporting instructions and sub-regulatory billing guidance to MACs and RHCs, these vaccine provisions will go into effect for dates of service beginning July 1, 2025.

Finally, CMS acknowledged our comments regarding the underlying issue of the cost report mechanism used in vaccine settlement, more specifically, that the high-dose vaccines often needed for Medicare patients are more expensive, and not appropriately accounted for when averaged with other, non-Medicare lower-cost vaccines. RHCs have reported that this may lead to RHCs being required to pay Medicare back at the time of settlement. CMS stated that they plan to take these comments into consideration as they make various cost report updates to implement the above policy.

Elimination of Productivity Standards
Currently, RHC productivity standards are established as 4,200 visits per full-time equivalent(FTE) physician and 2,100 visits per FTE nurse practitioner, PA, and certified nurse midwife. Other RHC practitioners are not subject to productivity standards.

Since all RHCs are now subject to some sort of upper payment limit (either the clinic specific cap for grandfathered RHCs or the national statutory cap for new and independent RHCs), the productivity standards have less impact as a guardrail and may have other negative implications.

Therefore, NARHC has urged CMS in recent years to reconsider and modernize the productivity standard. CMS agreed with the lack of necessity for these standards moving forward and has finalized their proposal to eliminate productivity standards for RHCs, effective with cost reporting periods ending after December 31, 2024.

Medicare Care Management Reforms and New Opportunities
Background
Since 2016, RHCs have been able to bill for Chronic Care Management (CCM) services through a consolidated care management code: G0511. This special payment rule pays approximately $72.90 in 2024, which is the average of the Physician Fee Schedule (PFS) rates for CCM, principal care management (PCM) services, Chronic Pain Management, General Behavioral Health Integration, as well as codes newly added in 2024: Remote Physiological Monitoring (RPM), Remote Therapeutic Monitoring (RTM), Community Health Integration (CHI), and Principal Illness Navigation (PIN) Services.

Beginning in 2024, the G0511 code was finally billable more than once per patient per month, so long as requirements are met and resource costs are not double counted, which NARHC has long advocated for. However, the single consolidated code currently represents 22 care management services, and this aggregation has presented a myriad of billing issues.

In last year’s comments, NARHC encouraged CMS to consider a revision to this complex bundled approach to RHC care management billing, either by allowing RHCs to bill care management services fee-for-service or creating more G-codes for the different buckets of care management services (i.e. RPM, RTM, CCM, etc.).

Further, there has been variation in how MACs have operationalized this complex policy and it was impossible for CMS to tell which specific care management services were being billed for in RHCs since everything was billed as G0511.

What CMS Finalized
CMS heard our concerns and recommendations and finalized their proposal to allow RHCs to bill the individual CPT codes that have historically comprised the G0511 code, instead of billing the consolidated code itself.

Beginning January 1, 2025, RHCs should bill, on the UB-04 claim form, the CPT codes found in Table 28 here when they perform care management services. While some of the fee schedule reimbursements may be lower than the consolidated rate of $72.90, this change means RHCs will be eligible to bill for add-on time-based codes, too.

In recognition of the complexities of yet another change to the care management billing system for RHCs however, CMS established a transition period for getting into compliance with the new billing structure. From January 1, 2025, through July 1, 2025, RHCs may bill either G0511 or the individual CPT codes in Table 28. This flexibility is at the RHC-facility level as your billing system is updated, however, not the patient level. After July 1, 2025, G0511 will no longer be reimbursable.

Separately, CMS finalized, with a few changes, new codes for Advanced Primary Care Management (APCM) services, a set of three G-codes intended to bundle existing care management codes based on complexity of patient condition, not time spent on each patient’s care management activities, reimbursed as calendar month bundles. If an RHC billed for these codes, they would not bill for individual services explained above.

These codes will be structured as follows:

• G0556 – Patients with 0-1 chronic condition; ~$15 per month
• G0557 – Patients with two or more chronic conditions; ~$50 per month
• G0558 – Patients who are QMBs with two or more chronic conditions; ~$110 per month

As all Medicare providers continue to learn more about these new APCM codes, stay tuned for additional resources from NARHC and CMS.

Conditions for Certification Changes – Lab Services
Background
RHC statute directs the HHS Secretary to ensure that RHCs provide routine diagnostic services. CMS has implemented this historically by requiring that RHCs have the equipment and supplies within the square footage of their RHCs to offer six specific lab services: chemical examinations of urine by stick or tablet method or both (including urine ketones); hemoglobin or hematocrit; blood glucose; examination of stool specimens for occult blood; pregnancy tests; and primary culturing for transmittal to a certified laboratory.

For several years, we have been hearing from RHCs that the hemoglobin/hematocrit requirement specifically is outdated given that providers rarely order these tests individually, and much more frequently they are ordered as part of a full panel. When this occurs, particularly for provider-based facilities who may be in close physical proximity to their parent hospital, many send patients to the full-service lab, making the equipment within the RHC duplicative, expensive, and wasteful.

NARHC has been advocating to Congress to remove the specific lab requirement to “directly provide” these services through a provision in the RHC Burden Reduction Act, in addition to encouraging CMS to use their authority to modify the specific list of required lab services.

What CMS Finalized
CMS is finalizing a proposal to remove hemoglobin and hematocrit (H&H) AND examination of stool specimens for occult blood from the list of lab services that RHCs must have the equipment and supplies to provide directly within the RHC.

RHCs should note that in their original proposal this summer, CMS was just proposing to remove H&H but asked if any others on the list were also no longer clinically appropriate. NARHC surveyed the RHC community during our August webinar and over 80% of respondents said that the stool specimen examination should also be removed from the list. We included this in our comments to CMS, and they heard the RHC community!

Additionally, they finalized updating “primary culturing for transmittal to a certified laboratory” to “collection of patient specimens for transmittal to a certified laboratory for culturing” to reflect more current clinical laboratory standards.

Note: This regulatory change does not prohibit you from continuing to do these lab services within your facility, it simply offers additional flexibility in situations where this isn’t being used or is no longer appropriate.

Conditions for Certification Changes – Provision of Primary Care versus Specialty Services
Background
RHC statute and associated regulations stipulates that RHCs must be primarily engaged in “providing outpatient services.” However, CMS State Operations Manual Appendix G explains that “RHCs may not be primarily engaged in specialized services.”

NARHC has pointed out this significant discrepancy for several years, however RHCs continue to be surveyed to the requirement that more than 50% of their hours must be the provision of primary care services.

This has become a greater issue as more RHCs offer a host of specialty services within their facility, services that clearly meet the outpatient requirement, but may tip total hours in the direction of specialty versus primary care services.

What CMS Finalized
CMS acknowledged the discrepancy that exists between the various documents that regulate the RHC program and in order to ensure greater flexibility in the outpatient services RHCs can provide, CMS finalized the below addition to the 491.9(2) regulation:

(i) The clinic or center must provide primary care services.

(ii) The clinic is not a rehabilitation agency or a facility primarily for the care and treatment of mental diseases.

CMS intent here is that RHCs will be required to provide primary care services, as they always have, but beginning January 1, 2025, will no longer be surveyed to a requirement that they provide more than 50% of operating hours as primary care services.

While CMS is technically adding something to the regulation, this is a decrease in the restrictive nature of the previously limiting threshold on specialty care to allow for greater flexibility for each individual RHC. The rule states that CMS expects RHCs to “offer a range of primary healthcare services to ensure that patients receive the necessary care at the earliest possible point of contact. Primary care services are critical in promoting health, preventing illness, and managing chronic conditions.”

Conditions for Certification Changes – Mental Health Services
Background
RHC statute reads that a Rural Health Clinic is “only a facility which... (iv) is not a rehabilitation facility or a facility which is primarily for the care and treatment of mental diseases.”

This has been interpreted to mean that RHCs can only provide up to 49% of their services as behavioral health services, without clear guidance as to how these services should be counted, and ultimately risking patient care access to these essential services.

NARHC has been advocating to Congress to remove this specific section of the statute through a provision in the RHC Burden Reduction Act, in addition to encouraging CMS to provide additional guidance on this outdated and arbitrary language.

In the proposed rule released this summer, CMS acknowledged that “mental diseases” is outdated terminology and may have additional negative impacts on stigma and help-seeking behavior but recognizes that this language is in the law governing the RHC program and can only be removed by Congress. However, they proposed that by defining “mental diseases” they could then issue guidance to assess an RHC’s compliance with the requirement in a more uniform way.

They solicited comments on various specific questions to help them define mental diseases. However, NARHC, and several other organizations that we coordinated with, expressed concern in our comments that CMS is risking additional unintended consequences by seeking to define such an outdated term.

Instead, we encouraged CMS to define a facility which is primarily for the care and treatment of mental diseases. Separately designated facilities such as Certified Community Behavioral Health Clinics (CCBHCs), Community Mental Health Centers (CMHCs), Opioid Treatment Programs (OTPs), and others could not be dually certified as an RHC. We agree that this is in alignment with the RHC statute. However, if it is not one of those facilities, we do not find it necessary for CMS to issue additional restrictions on the type or amount of behavioral health services done in the RHC.

In the final rule though, CMS ultimately withdrew this proposal. They stated that their intention was not to further discourage the provision of RHC behavioral health services and acknowledged that the way they were going about defining “mental diseases” could result in just that.

NARHC will continue to advocate to both Congress and CMS on the importance of RHC behavioral health services in order to remove barriers in providing such services.

Payment for Dental Services Furnished in RHCs
Background
Medicare is precluded from paying for most dental services, including routine cleanings and treatment. However, exceptions are made for certain outpatient services if the dental service is “inextricably linked to, and substantially related and integral to the clinical success of, other covered services.”

This exception extends to RHCs, meaning that if the service meets the “inextricably linked” standard and is provided by a dentist in the RHC, it will qualify as an encounter and be paid the RHC’s All-Inclusive Rate. In these instances, the RHC should report the KX modifier to indicate that it meets these requirements, and that adequate documentation is in the medical record.

What CMS Finalized
In this year’s rule, CMS expanded the list of “inextricably linked” medical services to include dialysis services for beneficiaries with End-Stage Renal Disease (ESRD). The full list of qualifying inpatient and outpatient services is organ transplant, hematopoietic stem cell transplant, bone marrow transplant, cardiac valve replacement, valvuloplasty procedures, chemotherapy when used in the treatment of cancer, chimeric antigen receptor (CAR) T-cell therapy when used in the treatment of cancer, administration of high-dose bone-modifying agents (antiresorptive therapy) when used in the treatment of cancer, and dialysis services in the treatment of end stage renal disease.

The “inextricably linked” dental services are a “dental or oral examination performed as part of a comprehensive workup prior to, and medically necessary diagnostic and treatment services to eliminate an oral or dental infection prior to, or contemporaneously with” if related to the above conditions.

Additionally, CMS finalized that when a medical encounter and a covered dental visit are provided to the same patient in the same day, they are eligible for an exception to the same day visit limitations in RHCs and will be paid as two separate billable encounters.

Intensive Outpatient Program (IOP) Services Furnished in RHCs
Background
Beginning in 2024, RHCs can furnish Intensive Outpatient Program (IOP) services, behavioral health services intended to serve patients who need care at a level equivalent to 9-19 hours of care per week.

This reimburses outside of the All-Inclusive Rate via a special payment rule that corresponds to approximately three services per patient per day, $259.13.

Other providers eligible to bill for IOP services can receive either the 3-services-per-day payment rate, or the 4-services-per-day payment rate, depending on the number of services provided, but RHCs and FQHCs are limited to the lower payment rate, regardless of the number of services provided.

What CMS Finalized
CMS acknowledged NARHC’s previous comments regarding this discrepancy and beginning January 1, 2025, will allow for RHCs to bill for the three or four services per day IOP, depending on the number of services provided.

RHC Telehealth Policy
Background
Current Medicare medical telehealth flexibilities will expire on December 31, 2024 without Congressional action. NARHC has been consistently advocating on Capitol Hill for an extension of these policies that includes a fix to reimbursement to ensure that RHCs are paid at parity for in-person and telehealth visits, like fee-for-service providers have received since 2020.

What CMS Finalized
Recognizing the potential for significant negative implications of patients and providers losing access to telehealth services after flexibilities have been in place for 4+ years, in the event Congress would not act by December 31, CMS elected to use their authority in this year’s rule to ensure that medical telehealth flexibilities remain in place through December 31, 2025.

Therefore, they finalized a proposal to continue current medical telehealth flexibilities for RHCs through 12/31/2025. RHCs will continue to bill G2025 for medical telehealth services and will be reimbursed approximately $97 per visit. These visits do not count as encounters and associated costs and visits must be carved out of your cost report,

Additionally, while mental health flexibilities are permanent, CMS further delayed the occasional in-person visit requirement prior to, and for the duration of those services, until January 1, 2026.

Importantly, given how bipartisan and popular telehealth is, it is almost entirely guaranteed that Congress will pass Medicare telehealth legislation before it lapses this year for all other providers. Therefore, despite the comfort that the RHC community has in knowing that, regardless of Congressional action or inaction, our ability to provide telehealth services will not be disrupted, it remains critically important that we continue to advocate to Congress to revise the telehealth payment methodology in its next extension.

When Congress returns to D.C. following this week’s election, we must keep up the pressure to pass legislation that is not simply a continuation of G2025 policy but allows for medical telehealth visits to be counted as encounters that would generate an All-Inclusive Rate payment. NARHC encourages you to utilize our messaging tool to share this information with your Members of Congress.

Final Comments

CMS acknowledges throughout the rule that these changes will require updates to various guidance documents, fact sheets, etc., including Medicare Benefit Policy Manual Chapter 13, State Operations Manual Appendix G, and others. The latest versions will be available at NARHC.org as these are updated.

Visit our technical assistance webinar page to register for the upcoming webinar: RHC Regulatory Changes in 2025 - Medicare Physician Fee Schedule Updates You Need to Know where we’ll dive into these various proposals in greater detail. If you have any questions or other feedback regarding implementation of these changes and new billing opportunities, please contact Sarah Hohman, NARHC Director of Government Affairs at Sarah.Hohman@narhc.org.

Finally, while this rule certainly contained lots of wins NARHC has been advocating for, CMS did not utilize this rulemaking opportunity to further expand upon preventive care eligible for adequate reimbursement in the RHC setting by amending the definition of an RHC medical visit to allow for Annual Wellness Visits (other than IPPEs) to be eligible for same day billing, as well as allowing those AWVs to be completed by RNs, as they are in non-RHC settings. Additionally, CMS did not propose to make RHCs eligible for separate reimbursement associated with the complex E/M add-on code (G2211) or the Social Determinants of Health (SDOH) Risk Assessment, nor did they explicitly change their guidance to allow for RHCs offering telehealth services outside of traditional RHC hours of operation. All of this and more are the regulatory changes we’re already preparing to ask for in the 2026 proposed rule! Ensure you remain engaged in NARHC’s advocacy efforts on NARHC.org to make your voice heard.