Proposed FQHC rule would increase Medicare payments 30 percent

A new proposed rule would boost Medicare payments to federally qualified health centers (FQHCs) by about 30 percent for services provided to beneficiaries of the program in medically underserved areas. The Centers for Medicare & Medicaid Services proposal, released Wednesday, would establish a prospective payment system under Medicare Part B for FQHCs as mandated by healthcare reform. 

Under the proposed system, which would begin October 1, 2014, Medicare would pay FQHCs a single encounter rate per beneficiary per day for all services, according to CMS' announcement. This rate would be adjusted for factors, such as as geographic cost variation or higher costs for new patients. Under the new system, Medicare would continue to pay for any services it previously covered.  

"The new payment system will help even more patients get care in federally-supported health centers," CMS Administrator Marilyn Tavenner said in CMS' announcement. "The services provided by these centers help ensure patients get important primary and preventive care that lowers costs and improves health outcomes."

CMS collaborated with the Health Resources and Services Administration (HRSA), which is responsible for the health center program, to develop the proposed rule.

"These health centers serve some of our most vulnerable populations," HRSA Administrator Mary Wakefield, Ph.D., R.N., said in the announcement. "We are excited about our collaboration with CMS to create a payment system that enables these vital health centers to keep doing such important work."

Many FQHCs have seen opportunity in the implementation of healthcare reform. In August, five California centers applied to form what, if approved, would be one of the first accountable care organizations based on FQHCs. Furthermore, in New Jersey, funding for FQHCs has seen a 25 percent funding increase under Republican Gov. Chris Christie's administration, Fierce Healthcare previously reported.

To learn more:
- here's the rule
- read the announcement