• STATE OPERATIONS MANUAL (SOM) Appendix G – (Guidance for Surveyors: Rural Health Clinics)


June 21, 2018
Palmetto Audio Notification

The following message is directed to those RHCs who for many years submitted their RHC claims to Cahaba.  This does NOT impact those RHCs who submit claims to other MACs.  However, RHCs who submit claims to other MACs may want to read this message as a cautionary tale to make sure something like does not happen to you.

Earlier this week, approximately 1,000 Rural Health Clinics who submit their RHC claims through Jurisdiction J began receiving letters from Palmetto indicating that they received improper payments (overpayments) from Cahaba (the previous MAC) for services provided between 2014 and 2018.  These overpayments supposedly occurred because the patients for whom these claims were submitted, were enrolled in a Medicare Advantage plan at the time the service was provided.

It appears that Cahaba (as Jurisdiction J MAC) failed to properly conduct a front-end edit of both Part A and Part B claims for several provider types, including RHCs. The result, according to Palmetto, is that thousands of claims were paid by traditional Medicare that should have been submitted to an MA Plan that was responsible for paying for the care of these Medicare beneficiaries.

Palmetto has identified thousands of improperly paid claims submitted by more than 1,000 RHCs in Jurisdiction J (nearly one quarter of all RHCs in the country).  They are seeking recoupment for these improperly submitted claims.

Please note that we’ve heard from several RHCs indicating that there are major errors in the Palmetto list of “improper” claims for which they are seeking recoupment.  There are claims that truly were appropriate for traditional Medicare or situations where the RHC itself had previously identified the improper payment and reimbursed the money and Palmetto does not seem to be aware of this resolution. 

At this time, we are unable to offer any solutions but we would encourage you to review all of the claims that Palmetto has identified as being paid in error.

For all of those RHCs affected by this mess, we want to assure you that NARHC has been in touch with CMS and Palmetto and we are looking at ways to resolve this mess.  Due to looming deadlines, we are pressing these officials to provide a solution sooner rather than later.  we can assure you that this is being reviewed at the highest levels of the Center for Medicare and Medicaid Services and we have impressed upon these officials that some RHCs will have to close because under “timely filing” limits, they will be unable to submit these claims to the MA plan for payment.  Many RHCs cannot afford that type of financial loss.

NARHC will continue to work with CMS and Palmetto to get this resolved.  Our goal is to ensure that no RHC has to close because of this and that there is a way for RHCs to either keep the money they’ve been paid or allow the RHCs to resubmit these claims to the MA plan (i.e. waive timely filing) so they can get paid by the proper payer for the care they provided.

As we get more information, we will post this on the listservs (both RHC TA and NARHC News).

Nathan Baugh
Director of Government Affairs
(202) 544-1880


June 19, 2018
Updates From Palmetto

We have been asked by Palmetto to share the following with the RHC Community.  If you are not in the Palmetto service area, you can disregard this posting.

There are three updates for RHCs that have been posted within the last few days/weeks.  If you are an RHC that submits your claims to Palmetto – particularly those who previously submitted claims to Cahaba – you are encouraged to review the RHC related posts appearing on this webpage:

Please note that Palmetto is requesting that providers – RHCs and others – refrain from calling the PCC for status on one of these outstanding issues.  Instead, it is highly recommended that you sign up for Palmetto email alerts available at the end of the CPIL.


April 19, 2018
2018 MIPS Eligibility Tool

The CMS has released it’s 2018 MIPS Participation Lookup Tool. You may use the updated Lookup Tool to check your eligibility in 2018 for the Merit-based Incentive Payment System (MIPS). Rural Health Clinic providers can enter their National Provider Identifier (NPI) to find out if they’re required to participate during the 2018 performance year.


March 29, 2018
New Medicare Card

Beginning in April 2018, the Centers for Medicare & Medicaid Services (CMS) will start mailing new Medicare cards to all people with Medicare.  The roll-out will occur over a several month period based upon the geographic location of the Medicare beneficiary.

You are encouraged to talk with your Medicare patients about this so they are aware of the transition and do not think that this is a “scam”.

  • Newly-eligible beneficiaries will get a card with a unique number, regardless of where they live
  • Distribution of cards will be randomized by geographic location
  • Starting in April, people with Medicare will be able to go to to sign up for emails about the card mailing and to check the card mailing status in their state
  • People with Medicare should use the new card once they get it, but either the SSN-based or the new random alphanumeric-based numbers can be used through December 2019
  • Beginning January 1, 2020 only the new card will be usable

Here is the state-by-state roll out schedule:

States/Regions Roll Out Time Window
Delaware, District of Columbia, Maryland, Pennsylvania, Virginia, West Virginia April – June 2018
Alaska, American Samoa, California, Guam, Hawaii, Northern Mariana Islands, Oregon April – June 2018
Arkansas, Illinois, Indiana, Iowa, Kansas, Minnesota, Nebraska, North Dakota, Oklahoma, South Dakota, Wisconsin After – June 2018
Connecticut, Maine, Massachusetts, New Hampshire, New Jersey, New York, Rhode Island, Vermont April – June 2018
Connecticut, Maine, Massachusetts, New Hampshire, New Jersey, New York, Rhode Island, Vermont After – June 2018
Alabama, Florida, Georgia, North Carolina, South Carolina After – June 2018
Arizona, Colorado, Idaho, Montana, Nevada, New Mexico, Texas, Utah, Washington, Wyoming After – June 2018
Kentucky, Louisiana, Michigan, Mississippi, Missouri, Ohio, Puerto Rico, Tennessee, Virgin Islands After – June 2018


February 05, 2018
CMS Publishes AAPM Table (Advanced Alternative Payment Models)

Today, the Centers for Medicare and Medicaid Services (CMS) published a table displaying the Alternative Payment Models (APMs) that CMS operates. In the table CMS identifies which of those APMs CMS has determined to be MIPS APMs or Advanced APMs. We will modify this list based on changes in the designs of APMs or the announcement of new APMs.

See the table here:


February 02, 2018
State Operations Manual (SOM) Appendix G – (Guidance for Surveyors: Rural Health Clinics)

CMS recently released a new version of the State Operations Manual (SOM) Appendix G. You can find it at:

This document contains significantly more detailed interpretive guidelines for RHC survey and certification than the previous version. If you have questions on how to meet the RHC rules and regulations, this document will likely have the answers you seek.


January 24, 2018
National Advisory Committee on Rural Health and Human Services Recommendations

The National Advisory Committee on Rural Health and Human Services (NACRHHS), recently released their policy brief and recommendations on how to “Modernize Rural Health Clinic Provisions.”

The NACRHHS picks one or two issues a year and produces a policy brief(s) for the Secretary of HHS. Last year, the committee chose to focus on Rural Health Clinics and we believe they have produced a thoughtful report with several helpful recommendations including:

  • Raising the AIR cap on RHCs
  • Grants to State Offices of Rural Health to support value-based care
  • Allowing RHCs to be distant site telehealth providers
  • Modernizing lab requirements
  • Allowing masters trained behavioral health providers to be RHC practitioners
  • Allowing RHCs to contract with PAs or NPs to fulfill the 50% requirement

You can read the full report for yourself here:

We recommend sharing this report with healthcare leaders in your community. If we communicate these ideas to decision makers effectively we can improve the viability of the Rural Health Clinic program.


January 10, 2018
Laboratory Billing

Program Memo issued by CMS (at the time known as HCFA) which addresses laboratory billing by both independent and provider-based RHCs, states:

Laboratory In light of recent inquiries regarding laboratory services, we are clarifying whether diagnostic laboratory tests furnished in the RHC/FQHC by their personnel are covered RHC/FQHC services paid under the all-inclusive rate, or whether such services are beyond the scope of RHC/FQHC services. While the law requires a facility seeking to be certified by Medicare as an RHC to provide routine diagnostic services, clinical diagnostic laboratory services are not within the scope of services covered and paid for under the RHC provisions.

Consequently, laboratory services (including the six required laboratory tests for RHC certification at 42 CFR §491.9) furnished by a clinic should be paid under the laboratory fee schedules. When clinics separately bill laboratory services, the cost of associated space, equipment, supplies, facility overhead and personnel for these services must be adjusted out of RHC/FQHC cost report. Furthermore, freestanding clinics should bill laboratory services to the Part B carrier and provider based clinics should bill these services to the fiscal intermediary that serves the main provider (e.g., the hospital’s intermediary).

The effective date of January 1, 2001 should be applied to implement this pronouncement to avoid the administrative burden of retroactively adjusting claims and cost reports.


December 15, 2017
Essential Community Provider Designation

Are you an Essential Community Provider (ECP)? Most Rural Health Clinics will answer that question with a resounding YES! But for many Health Plans sold on the Affordable Care Act (ACA) Exchanges, the answer is often a resounding “maybe”. Why, because many RHCs have failed to petition for ECP designation.

Under the ACA, RHCs are eligible for designation as Essential Community Providers which would enhance or strengthen the likelihood that Health Plans would be required to include your clinic in their provider networks under the “Network Adequacy” standards. But ECP designation is not automatic. Here is a link to the DRAFT ECP list released recently by the Centers for Medicare and Medicaid Services (CMS).

RHCs are one of the largest groups of provider types on the DRAFT ECP list but we know that many RHCs are not on this list. Please take a few minutes to see if your RHC is on this list (you can search by clinic name. If you are not on the list, go to the CMS website and complete the petition to be added to the list. It only takes a few minutes to get your clinic listed and the benefits of this could be significant when Health Plans begin putting together their provider networks in 2019.

NOTE: The deadline for submitting an ECP petition is December 22, 2017

If you have any questions or need additional information, you can submit those to:
Some facilities qualify in multiple categories. For example, a facility might choose as their primary “Black Lung Clinic” but also qualify as an “RHC” as a secondary designation.


November 20, 2017
RHCs Serviced by Cahaba

As you should have heard, Cahaba has lost their contract as a Medicare Administrative Contractor (MAC) for Jurisdiction J (JJ) (Alabama, Georgia, Tennessee). The new contractor for MAC Region J (JJ) will be Palmetto GBA.

Jurisdiction J (JJ), in addition to handling Medicare Part A and B claims for the three states mentioned above, was also the “legacy” MAC for hundreds of RHCs located outside of Jurisdiction J (JJ). Below is a link to an FAQ document produced by Palmetto GBA intended to answer questions from providers (hospitals, physicians, RHCs, etc.) affected by this change.

You are encouraged to review the entire document; however, there are two questions of specific interest to the RHC community that I have reproduced here:

Questions: I am with a RHC in Illinois, currently Jurisdiction J (JJ), submitting to Cahaba. Will we be included in the 01/28/18 transition date?
Answer: Yes, any current Jurisdiction J (JJ) providers with Cahaba GBA will transition to Palmetto GBA.

Question: Since Rural Health Clinics (RHCs) submit two claims, one to Part A on the UB04 claim form and one to Part B in the 1500 claim form, how will we submit our claims since Part A transitions in January and Part B transitions in February?
Answer: To submit claims for an RHC visit after Part A has transitioned to Palmetto GBA but Part B has not, you will submit the Part A claim to Palmetto GBA and the Part B claim will still be submitted to Cahaba GBA for processing.

If you are affected by this change and you have questions, you are encouraged to reach out directly to Palmetto GBA staff.

To download the Palmetto GBA Provider Outreach & Education Speaker Request Form click here.


November 2, 2017
Emergency Preparedness

November 15th is fast approaching and all RHCs must have taken steps to be in compliance with the new Emergency Preparedness requirements CMS will begin enforcing on that date.  NARHC is offering a free Technical Assistance call on the topic on 11/2/17.  We will review the new RHC Emergency Preparedness Conditions, the expectations for the RHC community and what you should be doing to be in compliance with the new requirements.  If you missed it we will have a recording available in about a week. CLICK HERE for a link to the page.


June 27, 2017
MACRA Proposed Rule for 2018
Last week, CMS released their 1,050 page MACRA proposed rule for calendar year 2018.

The big proposed change is an increase in the low-volume threshold for participation in MIPS to $90,000 (up from $30,000) of Medicare allowable revenue or 200 (up from 100) Medicare part B patients. This proposed change should exempt most RHC clinicians from the MIPS program.


As a refresher, MACRA stands for the Medicare Access and CHIP Reauthorization Act of 2015 and it is the underlying law behind the Quality Payment Program (QPP) which establishes two new payment tracks for eligible clinicians: the Merit Based Incentive Payment System (MIPS) and Advanced Alternative Payment Models (APMs). These new payment systems are designed to reward eligible clinicians (physicians, PAs and NPs) for the value of their care.

MIPS rewards clinicians who achieve high (CPS) Composite Performance Scores with bonus payments, and penalizes clinicians with poor CPS scores.

RHC payments are exempt from MIPS because the program only affects payments made under the Medicare Physician Fee Schedule (PFS). As you know, RHCs are paid on a cost basis through the RHC All-Inclusive Rate and bill on a UB-04 form. However, many RHCs bill for so-called “non-RHC services” on a CMS-1500 to a Medicare Part B MAC. These claims are potentially subject to MIPS payment adjustments if a clinician has enough “PFS” revenue/patients. However, CMS is now proposing a higher low-volume threshold that would exempt most clinicians and almost all RHC practitioners from participation in MIPS.

Clinicians can participate in MIPS individually, as a group (if the eligible clinician belongs to a group), or as a virtual group (individuals or several groups joining together for the purposes of a MIPS CPS score). Applicability of the low-volume threshold depends on the reporting entity. For example:

Consider three clinicians in a group practice. Each clinician has $50,000 of Medicare allowable revenue. If CMS finalizes the low-volume threshold as proposed, the clinicians would be exempt from MIPS in 2018 if they report individually. However, if they report as a group, they would all be eligible for a MIPS CPS score because, together, they have $150,000 of total allowable Medicare revenue.


One other way to avoid MIPS adjustments, is to participate in an Advanced APM. These are payment models that incorporate EHR standards, quality metrics, and have some financial risk to the provider. Clinicians who participate in an Advanced APM receive a lump sum incentive payment of 5% based on their PFS revenue. Any revenue generated through an RHC (or UB-04) claim, would not count towards this lump sum bonus.

The arrangements and details of each Advanced APM are too complicated for the purposes of this email. However, you may research more about Advanced APMs here.


The proposed rule is open for public comment until July 23rd. Once the public comment period ends, CMS will review all comments and potentially make changes in the proposal prior to the issuance of the final rule. CMS expects to issue the final rule in early November.

Nathan Baugh
NARHC, Director of Government Affairs
(202) 544-1880


June 14, 2017
NARHC Website has New Look + Increased SSL Security

The NARHC Website has a new look & feel plus additional SSL security!  We hope you like it!


June 13, 2017
RHC Guidelines & Emergency Preparedness

Please note that the RHC Guidelines & The Emergency Preparedness have undergone some recent changes. Check them out on our website on this link:


CLICK HERE for ARCHIVES (posts prior to June, 2017)