1. © Wipfli LLP 1 Date or subtitle © Wipfli LLP Jeff Bramschreiber, CPA, Partner Wipfli Health Care Practice Iowa Association of Rural Health Clinics RHC 101 & Legislative Update for RHCs October 1, 2014 9:05 a.m. - 10:30 a.m.

2. © Wipfli LLP I.RHC Overview/Becoming a RHC II.Legislative Update III.RHC Policy Manual IV.RHC Billing Information Discussion Topics 2

3. © Wipfli LLP 3 RHC Overview/Becoming a RHC © Wipfli LLP

4. ©Wipfli LLP 4 What Is a Rural Health Clinic? The rural health clinic certification is a designation that clinics providing primary care in certain rural, underserved areas can obtain from the Centers for Medicare & Medicaid Services (CMS), which provides an alternative, cost-based reimbursement system for treating Medicare and Medicaid beneficiaries. I. Rural Health Clinic Overview

5. © Wipfli LLP Rural health clinics were established by law in 1977 under PL 95-210 Amended the SSA by adding Sec.1861(aa) to extend Medicare and Medicaid entitlement and payment for primary and emergency care services furnished at an RHC by physicians, NPs, and PAs for services and supplies incidental to their services. Authorized CMS and states to pay qualifying clinics on a cost-related basis for these services. Required that certified clinics be located in an area that is designated by the Census Bureau as non-urbanized and designated or certified by HRSA as a shortage area. Contained a “grandfather” clause that enabled an RHC to remain in the program even if it no longer met the location requirements. I. Rural Health Clinic Overview

6. © Wipfli LLP ©Wipfli LLP 6 After a slow start, popularity in the RHC program grew significantly in the 1990s. There are over 4,000 RHCs throughout the United States. Over 50 percent are provider-based, mostly to Critical Access Hospitals. I. Rural Health Clinic Overview

7. © Wipfli LLP Total RHCs grew from 482 in 1989 to 4,014 in 2014. Largest number of RHCs located in Missouri; grew from 2 in 1989 to 380 in 2014. 145 RHCs in Kansas. I. Rural Health Clinic Overview

8. © Wipfli LLP ©Wipfli LLP 8 What Is a Rural Health Clinic? The rural health clinic certification is a designation that clinics providing primary care in certain rural, underserved areas can obtain from the Centers for Medicare & Medicaid Services (CMS), which provides an alternative, cost-based reimbursement system for treating Medicare and Medicaid beneficiaries. I. Rural Health Clinic Overview

9. © Wipfli LLP ©Wipfli LLP 9 Must be primarily engaged in providing primary care services: majority of the services provided by the clinic are for the “treatment of acute or chronic medical problems which usually bring a patient to a physician’s office.” Rural is defined as an area “that is not an urbanized area as defined by the Bureau of the Census.” I. Rural Health Clinic Overview

10. © Wipfli LLP Underserved areas include: Governor-designated shortage areas. Geographic Medically Underserved Areas (MUA). Geographic Health Professional Shortage Area (HPSA). Population-Based Health Professional Shortage Area. *Population-Based Medically Underserved Areas (MUP) do not qualify. I. Rural Health Clinic Overview

11. © Wipfli LLP Underserved area designation must be current, meaning the designation is made or updated within 4 years. Note: Health Care Safety Net Act of 2008 (H.R. 1343) amended title XVIII (Medicare) of the Social Security Act to revise the definition of "rural health clinics" to extend from three years to four years the time frame for making certain designations related to a shortage of health services in an area. I. Rural Health Clinic Overview

12. © Wipfli LLP Cost-based reimbursement is determined on the average cost per visit. A visit is defined as a medically necessary face-to-face encounter between a physician, nurse practitioner, physician assistant, certified nurse midwife, clinical psychologist, or clinical social worker and a patient. In general, if there is no “visit,” there is no RHC payment (exceptions for flu/pneumo vaccines). I. Rural Health Clinic Overview

13. © Wipfli LLP Located in a rural area. Current underserved designation. Primarily outpatient primary care services. Midlevel practitioner at least 50% of time clinic is open. Operate under medical direction of a physician. Physician must be present at least once every 2 weeks. I. Rural Health Clinic Overview

14. © Wipfli LLP Ability to perform (furnish) 6 basic lab tests:  Chemical examinations of urine  Hemoglobin or hematacrit  Blood sugar  Examination of stool specimens  Pregnancy tests  Primary culturing for transmittal to a certified laboratory I. Rural Health Clinic Overview

15. © Wipfli LLP Compliance with Federal, State, and Local Laws (42 CFR 491.4). Location of the Clinic (42 CFR 491.5). Physical Plant and Environment (42 CFR 491.6). Organizational Structure (42 CFR 491.7). Staffing and Staff Responsibilities (42 CFR 491.8). Provision of Services (42 CFR 491.9). Patient Health Records (42 CFR 491.10). Program Evaluation (42 CFR 491.11). I. Rural Health Clinic Overview

16. © Wipfli LLP Example - Interpretative Guidelines (Appendix G SOM): Physical Plant and Environment (42 CFR 491.6) (cont.) C. Non-medical Emergencies–Review written documentation and interview clinic personnel to determine what instructions for non-medical emergency procedures have been provided and whether clinic personnel are familiar with appropriate procedures. Non-medical emergency procedures may not necessarily be the same for each clinic. I. Rural Health Clinic Overview

17. © Wipfli LLP 1.Determine Eligibility 2.Calculate Financial Potential 3.Complete Enrollment Application 4.Policy and Procedures 5.Prepare for Survey 6.Notification of Survey Readiness 7.Survey Conducted 8.Approval 9.Payment Determination 10.Determine Initial Payment Rate 11.Begin Claims Process 12.First RHC Payment I. Rural Health Clinic Overview

18. © Wipfli LLP ©Wipfli LLP 18 Compare current reimbursement from Medicare with RHC rate. I. Rural Health Clinic Overview

19. © Wipfli LLP ©Wipfli LLP 19 There may be limited Medicare RHC benefits for independent RHCs. Below is the Medicare Physician Fee Schedule change in Part B payments from 2009 to 2014 compared to the increase in the maximum payment limit for independent RHCs. I. Rural Health Clinic Overview

20. © Wipfli LLP ©Wipfli LLP 20 Medicare Part B compared to Nat’l Provider-Based RHC average rate. I. Rural Health Clinic Overview

21. © Wipfli LLP ©Wipfli LLP 21 There is a distinct reimbursement advantage for provider- based RHCs that are part of a small (< 50 bed) hospital. Independent RHCs may still receive a slight benefit over traditional Medicare Part B payments; however, independent clinics often obtain/retain RHC status due to the Medicaid reimbursement advantage. I. Rural Health Clinic Overview

22. © Wipfli LLP A. Current HPSA and PSA bonus payments. B. Cost to comply with RHC requirements: employment of non-physician practitioner certification and survey billing and cost reports staff training and education C. Patient co-insurance impact. D. Expected changes in RHC and FFS programs. Additional factors to consider: I. Rural Health Clinic Overview

23. © Wipfli LLP Rural Assistance Center www.raconline.org CMS Rural Health Clinic Center www.cms.hhs.gov/center/rural.asp www.cms.hhs.gov/center/rural.asp Shortage Area Designations http://bhpr.hrsa.gov/shortage/ Sources of Additional Information RHC Information

24. © Wipfli LLP  Appendix G Interpretive Guidelines – Rural Health Clinics State Operations Manual (HCFA-Pub. 7)  42 CFR §491 Sources of Additional Information  Starting a RHC – A How To Manual  www.bphc.hrsa.dhhs.gov www.bphc.hrsa.dhhs.gov  www.narhc.org www.narhc.org  www.nrharural.org www.nrharural.org RHC Information

25. © Wipfli LLP 25 RHC Legislative/Regulatory Update © Wipfli LLP

26. Sequestration Beginning in 2013, Sequester mandated 2% cut in Medicare payments was adopted. This applied to all providers. As of April 1, 2013, Medicare RHC payments were reduced from 80% of the approved amount to 78.4% of the approved amount. II. Legislative Update 26

27. © Wipfli LLP Sequestration – How It Works On January 1, 2014, the RHC payment limit for independent and large hospital RHCs was set at $79.80 per visit. Medicare’s full payment is 80% of the approved amount, therefore, the Medicare payment amount before the Sequester would have been 80% x $79.80 = $63.84. Medicare’s payment amount with the Sequester is 80% x $79.80 = $63.84 x 98% = $62.56, a reduction of 1.6% from the maximum payment rate. RHC patient coinsurance remains at 20% of the charge. II. Legislative Update 27

28. © Wipfli LLP RHC Regulations To provide RHCs with greater flexibility in meeting their staffing requirements, CMS proposed to “revise §405.2468(b)(1) by removing the parenthetical "RHCs are not paid for services furnished by contracted individuals other than physicians," and revising § 491.8(a)(3) to allow non-physician practitioners to furnish services under contract in RHCs, when at least one NP or PA is employed.” This proposal was finalized and published in the Federal Register on May 2, 2014. II. Legislative Update 28

29. © Wipfli LLP RHC Regulations CMS proposed to revise the CAH regulations at §485.631(b)(2) and the RHC/FQHC regulations at §491.8(b)(2) to eliminate the requirement that a physician must be onsite at least once in every 2-week period (except in extraordinary circumstances) to provide medical care services, medical direction, consultation, and supervision. This proposal was finalized and published in the Federal Register on May 12, 2014. II. Legislative Update 29

30. © Wipfli LLP “We expect each facility to evaluate its services and adjust its physician schedule accordingly, as an appropriate physician schedule would reflect the volume and nature of services offered. The amount of time spent at the CAH or RHC by the physician to provide general oversight as well as patient care will be evaluated at the time of a survey for compliance with the CoPs (CAHs) or CfCs (RHCs).” “We agree with the commenter’s assessment and would like to emphasize that the role of the medical director of the CAH, RHC, or FQHC remains unchanged by our proposal. We are amending the regulations with respect to the prescribed frequency of a physician’s onsite presence at a CAH, RHC, or FQHC.” Federal Register on May 12, 2014. II. Legislative Update 30

31. © Wipfli LLP 31 Medicare Benefit Policy Manual for RHCs (CMS 100-02, Chapter 13) © Wipfli LLP

32. 20.1 - RHC Location Requirements (Rev. 173, Issued: 11-22-13, Effective: 01-01-14, Implementation: 01-06-14) A clinic applying to become a Medicare-certified RHC must meet both the rural and underserved location requirements. Mobile clinics must have a fixed schedule that specifies the date and location for services, and each location must meet the location requirements. Existing RHCs are not currently required to continue to meet the location requirements. RHCs that plan to relocate or expand should contact their Regional Office to determine their location requirements. III. RHC Policy Manual 32

33. © Wipfli LLP 70.4 - Productivity Standards (Rev. 173, Issued: 11-22-13, Effective: 01-01-14, Implementation: 01-06-14) Physician services that are provided on a short-term or irregular basis under agreements are not subject to the productivity standards. Instead of the productivity limitation, purchased physician services are subject to a limitation on what Medicare would otherwise pay for the services (under the Physician Fee Schedule), in accordance with 42 CFR 405.2468(d)(2)(v). Practitioners working in a RHC or FQHC on a regular, ongoing basis are subject to the productivity standards, regardless of whether they are paid as an employee or independent contractor. III. RHC Policy Manual 33

34. © Wipfli LLP 90 - Commingling (Rev. 173, Issued: 11-22-13, Effective: 01-01-14, Implementation: 01-06-14) If a RHC or FQHC practitioner furnishes a RHC or FQHC service at the RHC or FQHC during RHC or FQHC hours, the service must be billed as a RHC or FQHC service. The service cannot be carved out of the cost report and billed to Part B. If a RHC or FQHC is located in the same building with another entity such as an unaffiliated medical practice, x-ray and lab facility, dental clinic, emergency room, etc., the RHC or FQHC space must be clearly defined. If the RHC or FQHC leases space to another entity, all costs associated with the leased space must be carved out of the cost report. III. RHC Policy Manual 34

35. © Wipfli LLP III. RHC Policy Manual 35 170 – Physical and Occupational Therapy PT and OT services furnished by a PT or OT therapist who is employed by the RHC and furnished incident to a visit with a RHC practitioner are not billable visits but the charges are included in the charges for an otherwise billable visit if all of the following occur: The PT or OT is furnished by a qualified therapist incident to a professional service as part of an otherwise billable visit, The service furnished is within the scope of practice of the therapist, and The therapist is employed by or has an employment agreement with the RHC.

36. © Wipfli LLP 36 RHC Billing Information © Wipfli LLP

37. IV. RHC Billing 37 What Is Different About RHC Billing? RHC services are billed and reimbursed by Medicare (and Medicaid in some states) under an all-inclusive payment rate regardless of the type of practitioner (physician vs. midlevel) or the complexity of services performed (99212 vs. 99215, E/M vs. surgical procedure). RHC services are billed to Medicare on the UB-04 claim format instead of the CMS 1500 form often used for billing physician services. CPT/HCPCS codes are typically not reported for Medicare RHC billing purposes (except for preventive services).

38. © Wipfli LLP IV. RHC Billing 38 How Are RHCs Paid? RHCs are paid a flat rate for each face-to-face encounter based on the anticipated average cost for direct and supporting services (including allocated costs), with a reconciliation of costs (i.e., cost report) occurring at the end of the fiscal year.

39. © Wipfli LLP IV. RHC Billing 39 A RHC visit is defined as a medically-necessary, face-to-face (one-on-one) encounter between the patient and a – Physician Nurse Practitioner, Physician Assistant, Certified Nurse Midwife, Certified Psychologist, or Clinical Social Worker

40. © Wipfli LLP RHC visits may occur in the following locations: the RHC, the patient’s residence, an assisted living facility, a Medicare-covered Part A SNF, or the scene of an accident. IV. RHC Billing

41. © Wipfli LLP IV. RHC Billing 41 A RHC visit can also be considered a medically-necessary, face-to-face (one-on-one) encounter between the patient through – An Initial Preventive Physical Examination (IPPE), An Annual Wellness Visit (AWV), or Transitional Care Management (TCM) services.

42. © Wipfli LLP Special RHC Billing Topics Preventive Services See http://www.cms.gov/Center/Provider-Type/Rural-Health-Clinics-Center.html Except for IPPE, all preventive services furnished on the same day as another medical visit constitute a single billable visit. If an IPPE visit occurs on the same day as another billable visit, two visits may be billed. ServiceHCPCS Code Long DescriptionPaid at the AIR Eligible for Same Day Billing Coinsur./ Deduct. Initial Preventive Physical Exam (IPPE) G0402 Initial preventive physical examination; face to face visits, services limited to new beneficiary during the first 12 months of Medicare enrollment. Yes Waived

43. © Wipfli LLP Preventive Services (continued) See http://www.cms.gov/Center/Provider-Type/Rural-Health-Clinics-Center.html Except for DSMT/MNT, all of the preventive services listed below may be billed as a stand-alone visit if no other service is furnished on the same day. ServiceHCPCS Code Long DescriptionPaid at the AIR Eligible for Same Day Billing Coinsur./ Deduct. Annual Wellness Visit G0438 Annual wellness visit, including PPPS, first visit. YesNoWaived Annual Wellness Visit G0439 Annual wellness visit, including PPPS, subsequent visit YesNoWaived Special RHC Billing Topics

44. © Wipfli LLP Preventive Services (continued) See http://www.cms.gov/Center/Provider-Type/Rural-Health-Clinics-Center.html ServiceHCPCS Code Long DescriptionPaid at the AIR Eligible for Same Day Billing Coinsur./ Deduct. Screening Pelvic Exam G0101 Cervical or vaginal cancer screening; pelvic and clinical breast examination YesNoWaived Prostate Cancer Screening G0102 Prostate cancer screening; digital rectal examination YesNoNot Waived Special RHC Billing Topics

45. © Wipfli LLP Preventive Services (continued) See http://www.cms.gov/Center/Provider-Type/Rural-Health-Clinics-Center.html ServiceHCPCS Code Long DescriptionPaid at the AIR Eligible for Same Day Billing Coinsur./ Deduct. Diabetes Self- Management Training (DSMT) G0108 Diabetes outpatient self- management training services, individual, per 30 minutes No Not Waived Special RHC Billing Topics

46. © Wipfli LLP Preventive Services (continued) See http://www.cms.gov/Center/Provider-Type/Rural-Health-Clinics-Center.html ServiceHCPCS Code Long DescriptionPaid at the AIR Eligible for Same Day Billing Coinsur./ Deduct. Medical Nutrition Therapy (MNT) 97802 Medical nutrition therapy; initial assessment and intervention, individual, face-to-face with the patient, each 15 minutes No Waived Medical Nutrition Therapy (MNT) 97803 Medical nutrition therapy; re- assessment and intervention, individual, face-to-face with the patient, each 15 minutes No Waived Special RHC Billing Topics

47. © Wipfli LLP Preventive Services (continued) See http://www.cms.gov/Center/Provider-Type/Rural-Health-Clinics-Center.html ServiceHCPCS Code Long DescriptionPaid at the AIR Eligible for Same Day Billing Coinsur./ Deduct. Glaucoma Screening G0117 Glaucoma screening for high risk patients furnished by an optometrist or ophthalmologist YesNoNot Waived Glaucoma Screening G0118 Glaucoma screening for high risk patient furnished under the direct supervision of an optometrist or ophthalmologist YesNoNot Waived Special RHC Billing Topics

48. © Wipfli LLP Preventive Services (continued) See http://www.cms.gov/Center/Provider-Type/Rural-Health-Clinics-Center.html In response to several recent inquiries, CMS has determined that the screening pelvic and clinical breast examination, Healthcare Common Procedure Coding System (HCPCS) code G0101, is a billable visit when furnished by a Rural Health Clinic (RHC) or Federally Qualified Health Center (FQHC) practitioner to a RHC or FQHC patient. To avoid any delays in payment until the system is updated, providers should follow the guidance in the Preventive Services Chart on the RHC or FQHC center pages. Submit adjustments for any claims with G0101, rejected on or after January 1, 2014 to your Medicare Administrative Contractor, using this billing guidance.RHC FQHC Special RHC Billing Topics

49. © Wipfli LLP Preventive Services (continued) The correct type of bill for an adjustment should end with “7”. Examples: 117, 217, 717, etc. If using FISS to adjust the claim, the system automatically updates the adjustment with the appropriate type of bill. A Claim Change Reason Code (CCRC) is entered in the first available Condition Codes field (FL 18-28). A listing of CCRCs used for claims adjustment is available in the Claims Correction section of the FISS Reference Guide.Claims Correction Enter the Document Control Number (DCN) of the claim you are adjusting in FL 64. This information can be found in the “DCN” field on MAP171D or on the Remittance Advice (RA) you received when the original claim processed. If using FISS to adjust the claim, the system automatically populates the DCN field of the adjustment with the original claim’s DCN. Explain why you are submitting the adjustment in the Remarks field (FL 80). Note: if “D9” (any other change or multiple changes) is the appropriate CCRC for your Medicare adjustment, remarks are required when submitting the billing transaction. If using FISS to adjust the claim, an “Adjustment Reason Code” is entered on FISS page 03. See the Claims Correction section of the FISS Reference Guide for a listing of adjustment reason codes.Claims Correction Special RHC Billing Topics

50. © Wipfli LLP Questions ? 50

51. © Wipfli LLP For More Information This presentation was prepared by: Jeff Bramschreiber, CPA Partner, Health Care Practice Wipfli LLP 469 Security Blvd. Green Bay, WI 54313 920.662.2822 jbramschreiber@wipfli.com 51

52. © Wipfli LLP www.wipfli.com 52 www.wipfli.com