CMS will increase Medicare payments to federally qualified health centers (FQHCs) by as much as 32 percent, replacing the current fee-for-service model with a bundled payment model, according to CMS officials.
The new payment system, as outlined in the Affordable Care Act (ACA), establishes a Medicare prospective payment system for FQHCs, which provide access to medical services to patients in or from medically underserved areas.
The FQHCs provide vital primary and preventive care services to millions of people nationwide who are generally located in or from medically underserved areas. Medicare currently pays them based on reasonable costs subject to established payment limits for covered services furnished to people with Medicare. The ACA requires that the new Medicare Prospective Payment System (PPS) account for a number of factors, including the type, intensity, and duration of services provided in this setting. The new payment system will begin on October 1, 2014, and FQHCs will be transitioned to the new payment system throughout 2015.
Under the new PPS, Medicare will pay FQHCs a single encounter rate per beneficiary per day for all services provided, with some exceptions. The rate will be adjusted for geographic variation in costs. The rate will also be adjusted for the higher costs associated with furnishing care to a patient that is new to the FQHC and when the FQHC furnishes an initial preventive physical examination or an annual wellness visit to a Medicare beneficiary. The same services that have been paid for by Medicare in the past will continue to be covered under the new system.
The final rule was published in the Federal Register last week.
Source: CMS, April 29, 2014
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