Rural Health Clinics
Frequently Asked Questions
Question:
What is a Rural Health Clinic?
Answer:
A Rural Health Clinic 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. RHCs are required
to use a team approach of physicians and midlevel practitioners
(nurse practitioners, physician assistants, and certified nurse
midwives) to provide services. The clinic must be staffed at
least 50% of the time with a midlevel practitioner. RHCs may
also provide other health care services, such as mental health
or vision services, but reimbursement for those
services may not be based on their allowable costs.
Question:
What are the benefits of being certified
as an RHC?
Answer:
RHCs receive special Medicare and Medicaid reimbursement. Medicare
visits are reimbursed based on allowable costs and Medicaid
visits are reimbursed under the cost-based Prospective Payment
System (PPS).
Ordinarily, this will result in an increase in reimbursement. RHCs
may see improved patient flow through the utilization of NPs,
PAs and CNMs, as well as more efficient clinic operations.
Question: Will
RHC certification guarantee a better financial return?
Answer: Not necessarily. It is very
important to complete a financial assessment to see if the RHC
program is right for your area. Financial benefits of RHC status
depend on the mix of payers and services offered. Traditional fee
for service could be better in some cases. When evaluating financial
feasibility, look at the broader financial picture rather than
individual visits. Chapter Three of Starting
a Rural Health Clinic: A How-To Manual discusses financial
feasibility analysis for potential RHCs.
You may want to hire a consultant to conduct a financial feasibility
study. The National Association
of Rural Health Clinics can provide you with a list of consultants.
The NARHC does not endorse these consultants but provides the list
as a service. You can contact the NARHC at:
E-mail: info@narhc.org
Telephone: 202.543.0348
Fax: 202.543.2565
Question: What
types of services do RHCs provide?
Answer: RHCs must provide out-patient
primary care services and basic laboratory services. They can also
offer other services such as mental health services and vision
services, but those services may not be reimbursed based on allowable
costs.
Question:
Does a clinic have to be public or non-profit
to be an RHC?
Answer:
No. RHCs can be for-profit or not-for-profit, public or private.
Question: What
makes an RHC provider-based?
Answer: Provider-based RHCs are considered
an integral part of a hospital, nursing home or home health agency
that is already a Medicare certified provider. The provider associated
with the RHC handles its reimbursement.
RHCs that are provider based to a hospital with less than 50 beds
are exempt from the per-visit reimbursement cap.
Question: What
makes an RHC independent?
Answer: Independent RHCs are generally
stand-alone clinics. Unlike provider-based RHCs, independent RHCs
go through a Fiscal Intermediary (FI) or Medicare
Administrative Contractor (MAC) for claims processing and
reimbursement.
Question:
Are there location requirements for RHCs?
Answer:
Yes, RHCs must be located in rural areas with current health care
shortage designations.
RHCs must be located in a rural area. Any area that is not in
a U.S. Census-designated "urbanized area" is considered
rural. You can use RAC's Am I Rural? service
to as a first step to see if your location qualifies:
- Go to Am I Rural?
- Enter your
location and click
"Next"
- Then check the box next to the program "CMS
- Rural Health Clinics Program"
- Click the "Am I
Rural?"
button to create a report regarding your location.
The final determination of rural status is made by your
state agency responsible for RHC certification and the CMS regional
office. If you have questions or want further verification of
your location status, please contact your state
agency as a next step.
RHCs must be located in a shortage area that has
been designated within the last three years. There are three types
of shortage areas that qualify:
- federally designated HPSA (Health Professional Shortage Area)
- federally designated MUA (Medically Underserved Area), or
- state Governor designated underserved area
Your state agency responsible for RHC certification may be able to assist you in determining if your area
qualifies as a shortage area. Here are some other resources that may help:
Question: If
a location loses its shortage designation, is it possible
to remain a Rural Health Clinic?
Answer:
Under current rules, no mechanism exists for a Rural Health Clinic
to lose its designation because it is located in an area that is
no longer designated as medically underserved. However, the Centers
for Medicare and Medicaid Services is currently developing rules
to address this issue. It is expected that the rules will allow
RHCs to apply for an exception to maintain their designation.
Question:
Do I need a separate building to have an
RHC?
Answer:
No. An RHC can be in a stand-alone building, a part of another building
or a mobile unit.
Question:
Are there special staffing requirements for
RHCs?
Answer:
RHCs must be staffed by at least one nurse practitioner (NP), physician assistant (PA), or
certified nurse midwife (CNM). The NP, PA, or CNM must be on-site
to see patients at least 50% of the time the clinic is open. A physician (MD or DO) must
supervise the midlevel practitioner in a manner consistent with state and federal law.
Question: Are
there Quality Assessment and Performance Improvement (QAPI) requirements
for RHCs?
Answer: It is expected that the Centers
for Medicare and Medicaid Services will issue a proposed rule sometime
after January 1, 2008 that will include requirements for RHCs to
have a Quality Assessment and Performance Improvement (QAPI) program.
For more information about quality improvement for RHCs, please
see the Office of Rural Health Policy's Rural
Health Clinics Technical Assistance Conference Call Series web
site and Frequently
Asked Questions about RHC Quality Improvement.
Question:
How does Medicare reimburse RHCs?
Answer:
RHCs receive an interim payment rate throughout the clinic’s
fiscal year which is reconciled at the end of the fiscal year through
cost reporting. The interim payment rate is determined by taking
total allowable costs for RHC services divided by allowable visits
provided to RHC patients receiving core RHC services.
RHC staff must understand traditional Medicare regulations for
coding and documentation as well as unique RHC billing requirements.
Question: What
are the Medicare Administrative Contractors (MACs) and what is
their role in administering Medicare Part A and Part B?
Answer:
Section 911 of the Medicare Modernization Act of 2003 mandates
that the Secretary for Health & Human Services replace the
current contractors administering the Medicare Part A or Part
B fee-for-service programs with new Medicare Administrative Contractors
(MACs). Part A/Part B Medicare Administrative Contractors
(MACs) will replace the current fiscal intermediaries and carriers
and handle administration of both the Medicare Part A and Part
B programs in specified geographic regions. CMS
plans to award a total of 19 MAC contracts through three procurement
cycles, with each cycle lasting approximately 9-12 months from
solicitation to award. Fifteen MACs will cover the majority
of Part A/B service provider types, and four specialty MACs will
cover DME suppliers. The A/B MACs will be responsible for the
receipt, processing, and payment of Medicare fee-for-service
claims. In addition, they will be the primary contact for physicians,
and will perform functions related to: Appeals, Provider Outreach
and Education, Financial Management, Provider Enrollment, Reimbursement,
Payment Safeguards, and Information Systems Security. For
more information and regular updates, please see the CMS overview
and related links regarding Medicare
Contracting Reform.
Question:
How do states reimburse RHCs for Medicaid?
Answer:
All state Medicaid programs are required to recognize RHC services.
The states may reimburse RHCs under one of two different methodologies.
The first is a prospective payment system. Under this methodology, for
FY (fiscal year) 2001, the state calculates a per visit rate based on an average of
100 percent of the reasonable costs furnished in FY 1999 and FY
2000. For each succeeding year, this per visit baseline rate is then
increased by the Medicare Economic Index factor. For new facilities
after FY 2001, the state will establish a per visit rate based on 100
percent of reasonable costs of furnishing services during the fiscal
year.
The second methodology is an Alternative Payment methodology.
Under this methodology, there are only two requirements: 1) the clinic
must agree to the methodology, and, 2) the payment to the clinic must at
least equal the payment under a prospective payment system.
Medicaid agencies also may cover additional services that are not normally considered RHC services,
such as dental services.
For more information about state Medicaid benefits for RHC services, please
see this state-by-state
guide to Medicaid benefits from the Kaiser
Family Foundation and National Conference of State Legislatures.
Question: Where
are existing RHCs located?
Answer: You can view the Community Information
Resource Center's interactive
map of rural health clinics to see locations of current Rural Health
Clinics.
Question:
How can I find other RHCs in my area?
Answer:
Contact the state agency responsible for
certifying RHCs to request the names of other RHCs in your area.
Typically, clinic staff are willing to assist new start-ups as long
as the new clinic is not in competition for clients.
Question: How
do I get certified as an RHC?
Answer: The first step is to determine if
the site is eligible. Contact your state
agency responsible for RHC certification to find out if your site
qualifies for Rural Health Clinic status. The site must be in a U.S.
Census non-urbanized area and a health care shortage area designated
within the last three years. See Are there location
requirements for RHCs?
The second step is to evaluate the financial feasibility of RHC status
based on estimated (for new clinics) or actual (for existing clinics)
data on payer mix – Medicare, Medicaid, other. Existing practices
that do not have an NP, PA or CNM on staff must consider whether the
cost of hiring one will be offset by increased revenue.
The third step in the certification process is filing an RHC application
and a CMS provider enrollment form. Contact your state
agency responsible for RHC certification for an RHC application packet.
The CMS
855A Medicare Enrollment Application - Institutional Providers form is available
on the CMS web site.
You will be notified that you are eligible for the RHC program after
your two applications have been processed. The next step is the RHC Certification
inspection. When you are ready for inspection and in compliance with
RHC requirements, notify your state agency. The state agency will then
conduct a survey.
The last step of the certification process is the RHC Cost Report. Once
a clinic has received its Medicare Provider Letter from CMS, the clinic
files a projected cost report to have its Medicare Rate determined. It
is important to get expert advice from someone familiar with the CMS-222
Schedule M Cost Report. Accuracy can have significant financial impact
on year-end cost report.
Question:
What other options are there for providing primary care in rural
areas?
Answer:
Some other options include the Federally Qualified
Health Centers program and the Critical
Access Hospitals program.
See the publication Comparison
of the Rural Health Clinic and Federally Qualified Health Center
Programs for comparisons of the RHC and FQHC options.
Credits
