Rural Health Policy

Regulatory Review

The Federal Office of Rural Health Policy is charged in Section 1102(b) of the Social Security Act with advising the Secretary of the U.S. Department of Health and Human Services on the effect that federal health care policies and regulations may have on rural communities. Monitoring current and proposed changes, including programs established under titles XVIII and XIX (Medicare and Medicaid), FORHP analyzes their impact on the financial viability of small rural hospitals and clinics, on the ability of rural areas to attract health professionals, and on rural areas’ access to high quality care.

Data collection and analysis is essential to understanding the challenges in rural communities, how those communities are impacted by policy, and setting policy for the future. For this reason, the work of the Rural Health Research Centers informs that of FORHP’s policy team and vice versa.

Policy Announcements

May 23

Reporting and Billing Updates for RHCs. Billing staff at Rural Health Clinics should be aware of new information provided by CMS to assist with reporting requirements for the Healthcare Common Procedure Coding System (HCPCS), effective April 1, 2016.  

May 9-13

Comments Requested: Interoperability for EHRs - Submit by June 3. The Office of the National Coordinator for Health Information Technology (ONC) is seeking feedback on its plan to achieve widespread exchange of health information through Electronic Health Records (EHRs).  ONC hopes to establish the metrics that will be used to determine if the goal of interoperability for the entire nation has been met by December 31, 2018 as planned.  Congress declared under the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) that the metrics be in place by July 1, 2016.  Rural providers may be subject to meeting these metrics and should consider providing input on the unique challenges to interoperability they may face.

Updating Policy and Payment Rates for Long Term Care - Comments due June 17.  In this second year of a three-year transition to the new dual-rate payment system for Long Term Care Hospitals (LTCHs), CMS estimates that total payments to LTCHs will decrease by 6.9%, or $355 million. The proposed rule, issued April 27th, projects only a slight difference in standard rate payments for the relatively small number of rural LTCHs (0.2%) compared to their urban counterparts (0.3%). In addition to the annual payment revisions, the proposal updates administrative policy and quality reporting requirements. The rule would establish a single, consolidated "25 percent threshold policy," adjusting payments when the number of cases an LTCH admits from a single hospital exceeds the threshold. This threshold is generally 25%, but increases to 50% for rural LTCHs, providing more flexibility given the relative scarcity of referring hospitals in rural communities. Finally, CMS adds four new IMPACT Act measures to the LTCH quality reporting program (QRP), including Medicare spending per beneficiary.

CMS to Update Rates for Inpatient Rehabilitation Facilities - Comments Requested by June 20. The proposed rule, issued April 25th, would increase payments by $125 million across the board, including a 0.9% increase to rural IRFs . In addition to annual payment revisions, quality measures and reporting requirements under the IRF quality reporting program (QRP) would be updated, adding five new measures, including four to comply with the IMPACT Act, such as discharge to community and Medicare spending per beneficiary (MSPB). CMS also establishes procedures for IRFs to review reports on quality to data to be reported to the public.

Rate and Policy Updates for Skilled Nursing Facilities - Comments Requested by June 20.  Issued April 25, CMS's proposed rule will increase total payments to SNFs by 2.1%, or $800 million, compared to FY 2016. Of note for rural SNFs, CMS projects no difference in payment increase by geography: both rural and urban SNFs will receive the payment increase.  In addition to annual payment revisions, CMS updates the quality measures and administrative procedures under both the SNF value-based purchasing (VBP) program and SNF quality reporting program (QRP). CMS adds the SNF 30-day potentially preventable readmission (SNFPPR) measure to SNF VBP and four new IMPACT Act measures to SNF QRP, including discharge to community and Medicare spending per beneficiary (MSPB).  CMS also verifies that both the SNF VBP and SNF QRP apply to swing beds at all rural hospitals except critical access hospitals.

New Guidance on FQHC and RHC Services.  On April 26, CMS issued a letter to State Health Officials providing guidance on 1) the process of paying federally-qualified health centers (FQHC) and rural health clinics (RHC) for Medicaid and Children's Health Insurance Program (CHIP) services furnished under a managed care contract, and 2)  network sufficiency standards applicable to a Medicaid managed care delivery system for services provided at FQHCs, RHCs or free-standing birth centers (FBC).  This guidance gives states the option to simplify the supplemental payment requirements for FQHCs and RHCs by amending the state plan.  It also clarifies that in order for a Medicaid managed care plan's provider network to be sufficient, the plan must include access to FQHC, RHC, and FBC services, if available in the contract service area.

New Quality Measures for Nursing Home Compare.  On April 27, CMS announced six new measures to be reported on Nursing Home Compare, the CMS website posting quality data on nursing facilities certified under Medicare and Medicaid. Two of the additions are new measures for long-stay beneficiaries, assessing patients' ability to move on their own and the proportion of patients who receive anti-anxiety or hypnotic medications. Changes that should be beneficial to patients in rural areas include new measures for short-stay beneficiaries, assessing discharge to the community, emergency department visits, re-hospitalizations, and improvements in function.

CMS Updates Fire Safety Standards.  On May 4, CMS published a final rule that updates fire safety standards for certain facilities participating in Medicare and Medicaid.  For this rule, that includes hospitals, critical access hospitals (CAHs), long-term care facilities, hospices, and programs of all-inclusive care for the elderly (PACE). The rule adopts minimum requirements approved by the National Fire Protection Association as outlined in the 2012 editions of the Life Safety Code and the Health Care Facilities Code, with some exceptions.

April 25-29

Historic Change to How Clinicians Are Paid - Comments Requested by June 27

At the heart of the proposed rule that CMS issued on April 27th is the Quality Payment Program which, beginning in 2019, would offer new systems for paying doctors and other clinicians who serve Medicare beneficiaries. One, the Merit-Based Incentive Payment System (MIPS), would evaluate the quality of care delivered based on four performance categories: cost, quality, exchange of information (use of electronic health records) and clinical practice improvement. The second system, advanced Alternative Payment Models (APMs), offers higher financial incentive to clinicians who improve quality by coordinating care across providers and settings. Initiatives for coordinated care include CMS's Accountable Care Organization (ACO) Model and Comprehensive Primary Care.

The rule would consolidate three existing payment programs under MIPS:  the Physician Quality Reporting System, the Physician Value-based Payment Modifier and the Electronic Health Record Incentive Program. It is the first step toward implementing the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), which aims to lower costs while raising quality of health care delivery.  It's expected that most Medicare clinicians will initially participate in the MIPS program but over time will move toward the alternative payment model.

What do rural providers need to know?  First, that CMS needs your review and feedback to understand the challenges that are unique to rural areas and how these changes would affect your practice. Once the proposed rule is officially published on May 9th, CMS will accept comments until Monday, June 27th.  Some key issues for your consideration:

  • For the first two years of MIPS, Eligible Professionals (EPs) would include physicians, physician assistants, nurse practitioners, clinical nurse specialists and certified registered nurse anesthetists.  Other professionals may be added in later.
  • EPs below the low-volume threshold would be excluded from MIPS.  The proposal defines the threshold as having Medicare billing charges less than or equal to $10,000 and providing care for 100 or fewer Part B-enrolled Medicare beneficiaries.
  • The MIPS adjustment would apply to EPs who have assigned their billing rights to a Critical Access Hospital (i.e. Method II CAH billing).
  • Currently, Rural Health Clinics and Federally Qualified Health Centers are excluded from reporting to MIPS since they are paid differently under Medicare. CMS is asking for comment on whether these safety net providers should but have the option to voluntarily report on applicable measures and activities with no penalty in order to remain in alignment with broader efforts under Delivery System Reform.
  • Only certain APMs are considered as qualifying for receipt of incentive payments and exclusion from MIPS payment adjustments.

CMS is providing opportunities to better understand the rule and provide early feedback through three sessions that are open to the public. Register now for an Overview of MACRA on Tuesday, May 3rd , an Overview of MIPS on Wednesday, May 4th, and an Overview of the Quality Payment Program on Tuesday, May 10th. Space for these webinars is limited and registration is required.  After your registration is completed, you will receive a follow-up e-mail with step-by-step instructions on how to log-in to the webinar.  CMS encourages review of the proposed rule (CMS-5517-P) prior to these listening sessions and reminds that the feedback you give will not be considered formal commenting.

View Archived Policy Announcements

Last Reviewed: May 2016