During the final negotiations of the COVID relief package from late December, 2020, Sen. Chuck Grassley (Iowa) led efforts to include modified language from the Rural Health Clinic Modernization Act. This language was included in the final bill, which does the following:
- Raises the Independent RHC cap to $100 on April 1, 2021, and set to rise each year thereafter to $190 by 2028.
- Newly established RHCs would now also be subject to the increased cap, which means that no new RHCs (even those purchased or established by hospitals with less than 50 beds) could receive uncapped cost-based reimbursement.
- Uncapped RHCs in existence today would be grandfathered-in at their current All-Inclusive Rate and would still see year-over-year increases but would be constrained to their current AIR plus an adjustment for MEI (the Medicare Economic Index).
- RHCs will now be allowed to bill for hospice attending physician services.
Although this is great news for independent RHCs, this may come at the cost of our provider-based RHCs. It does not appear that any clinics will have a reduction in their all-inclusive rate, which is a very important positive factor. But, this new language will prevent hospitals from establishing new RHCs and receiving the more lucrative uncapped AIR. Again, it’s important to note that this will not affect the AIR that any provider-based clinics are currently receiving…they are grandfathered-in to this new policy.
The board and legislative committee of the Alabama Rural Health Association will examine this language more closely and determine its effects to Alabama clinics. Stay tuned for more information.