Healthcare Business News

Health centers in line for Medicare boost under new pay model

By Virgil Dickson
Posted: April 29, 2014 - 9:30 pm ET

Medicare will increase payments to federally qualified health centers by as much as 32% while scrapping the fee-for-service model for one that gives the facilities a bundled rate for each patient encounter.

On Oct. 1 the CMS will begin transitioning some 8,900 FQHCs to a new prospective payment system under a final rule issued late Tuesday. The health centers get enhanced Medicare reimbursement for providing care to underserved populations.

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Some of them, however, are wary of the new payment system, which was called for in the Patient Protection and Affordable Care Act.

Under the current system, FQHCs are reimbursed for multiple services performed in one day, which the proposed rule would have ended.

The CMS said an analysis of 2011 and 2012 claims showed the scenario was extremely rare. Advocates for the health centers, however, argued that the analysis may not reflect a recent rise in such visits. The “approach is a counterproductive policy decision because it discourages a positive trend in health centers toward integrated models of care,” the National Association of Community Health Centers said in a statement responding to the proposed rule.

The final rule will allow separate billings for mental health services delivered on the same day as medical services, as well as for the treatment of illnesses and injuries that arise on the same day as another visit.

Elsewhere in the sweeping 201-page document, the CMS modified a controversial provision that changes the penalties for violating the agency's process for ensuring the proficiency of clinical laboratories.

The provision carries out a 2012 law that gives the CMS more discretion to determine when labs are intentionally undermining the system in which the CMS sends labs samples to test in the same manner they would test actual patient samples.

But lab companies and health systems that operate labs argued that the agency's proposed disciplinary approach still made it possible for minor and unintended infractions to trigger extreme sanctions.

The penalties include a one-year ban from Medicare for owners and operators of labs that repeatedly send the samples to other labs rather than test them.

The American Hospital Association said in a comment letter that the proposed policy would have had “a devastating impact on the patients served by large national health systems that often own and operate many laboratories in many locations.”

In the final rule, the CMS said it will allow other labs owned by a banned operator to remain open.

Correction: An earlier version did not reflect that the final rule allows separate billing for some instances of same-day services.

Follow Virgil Dickson on Twitter: @MHvdickson

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