Medicare Physician Fee Schedule 2022 Final Rule Summary

Sarah Hohman, Deputy Director of Government Affairs


On November 2nd, the Centers for Medicare and Medicaid Services (CMS) issued the CY 2022 Medicare Physician Fee Schedule Final Rule. This year’s rule finalizes several significant Rural Health Clinic (RHC) policies originally proposed in summer 2021, which NARHC summarized here.

Following our analysis, NARHC submitted comments to CMS on each RHC provision, and as you can read below in more detail, we are very pleased with the ways CMS recognized and incorporated these comments.

“We can tell CMS is listening,” said Bill Finerfrock, Executive Director of NARHC. “Over the years, new Medicare benefits tended to come to the RHC program last. Thankfully, that is not the case this year, as the “mental health services via telehealth” benefit will be coming to RHCs on day one. We still have some work to do in the future on remote patient monitoring, but this year’s final rule is a very positive step.”

The final rule also contains some important clarifications regarding grandfathered RHCs.

“We were concerned that CMS had not yet clearly indicated how grandfathered RHCs could change addresses or change ownership without losing their grandfathered status,” said Nathan Baugh, Director of Government Affairs for NARHC. “However, this rule makes it clear that grandfathered RHCs that retain their CCN through a move or CHOW will retain their grandfathered status. We understand that there still may be some additional clarification necessary as the MACs move to institute clinic-specific upper payment limits, but CMS has been responsive thus far and we are hopeful that new guidance will be released soon.”

For a detailed summary of the RHC-relevant provisions of the 2022 PFS final rule please see below:

RHC Mental Health Services Via Telehealth


Prior to the COVID-19 pandemic, RHCs were only allowed to serve as originating sites for telehealth visits. The CARES Act of 2020 first allowed RHCs to serve as distant sites for telehealth visits for the duration of the Public Health Emergency (PHE), but it also established a “special payment mechanism” for RHC distant site services. This special payment mechanism paid one rate based on the national average payment rates for comparable telehealth services and created HCPCS code G2025 for a reimbursement of $99.45 (CY 2021).

Ever since the creation of the special payment rule, NARHC has been fighting to change the way Medicare reimburses for telehealth visits. We believe RHCs should receive payment parity between in-person and telehealth visits, which is how telehealth works for traditional fee-for-service offices. For RHCs, we want normal reimbursement rates, normal coding (with modifier 95 to indicate telehealth), and normal cost reporting rules to apply to all telehealth visits.

In the Consolidated Appropriations Act of 2021, Congress permanently extended Medicare telehealth coverage of mental health services beyond the public health emergency (PHE). Prior to the release of the PFS rule, it was unclear if this would apply to RHCs and FQHCs.

What CMS Proposed

In order to ensure that RHCs were not left behind in the permanent extension of telehealth coverage of mental health services beyond the PHE, CMS proposed to redefine what constitutes a mental health visit “to ensure that they reflect contemporary medical practice.”

§ 405.2463 What constitutes a visit


(3) Visit - Mental health. A mental health visit is a face-to-face encounter between a RHC or FQHC patient and one of the following:

(i) Clinical psychologist.
(ii) Clinical social worker.
(iii) Other RHC or FQHC practitioner, in accordance with paragraph (b)(1) of this section, for mental health services.


(3) Visit - Mental health. A mental health visit is a face-to-face encounter or an encounter furnished using interactive, real-time, audio and video telecommunications technology or audio-only interactions in cases where the patient is not capable of, or does not consent to, the use of video technology for the purposes of diagnosis, evaluation or treatment of a mental health disorder between an RHC or FQHC patient and one of the following:

(i) Clinical psychologist.
(ii) Clinical social worker.
(iii) Other RHC or FQHC practitioner, in accordance with paragraph (b)(1) of this section, for mental health services.

What NARHC Commented

NARHC expressed gratitude for CMS proposing to re-define the definition of a visit and allowing RHC services to better reflect contemporary medical practice as well as the inclusion of audio-only communications technology, at the RHC’s normal, all-inclusive rate.

We also expressed support for the proposal that an in-person service be provided at least every 6 months while the beneficiary is receiving services furnished via telecommunications technology for diagnosis, evaluation, or treatment of mental health disorders as NARHC believes it protects the integrity of the telehealth benefit and ensures some level of physical proximity between the patient and provider which is valuable in the event of in-person mental health care needs.

Ultimately, we feel as if this change to the definition of an RHC “visit” is a promising step in allowing all Medicare services provided via telehealth to be reimbursed at the RHC’s normal, all-inclusive rate, as face-to-face visits are reimbursed.

What CMS Finalized

  • Beginning in CY 2022, RHCs will be paid for mental health visits furnished via telecommunications technology at the same rate they are paid for in-person mental health visits (All-Inclusive Rate).
  • RHCs may furnish mental health visits using audio-only interactions in cases where beneficiaries are not capable of, or do not consent to, the use of devices for two-way, audio/video interaction.
  • RHCs must append the 95 modifier in instances where the services were furnished using audio-video technology and append a new service level modifier that CMS will establish for audio-only to track utilization.
  • An in-person mental health service must be furnished within 6 months prior to the furnishing of the telehealth service and in general, there must be an in-person mental health service provided at least every 12 months while the beneficiary is receiving mental health services furnished via telehealth. The rule allows for limited exceptions to this requirement based on beneficiary circumstances, documented in the patient’s medical record by the practitioner.
  • Revises the regulation at § 405.2463 ‘what constitutes a visit,’ as described above.

Note: These permanent provisions only apply to mental health services provided via telehealth. The temporary authority that applies to how RHCs can provide and bill for all other telehealth services as explained above will expire at the end of the PHE. NARHC is working with Congress to get this extended permanently for all telehealth services, encouraged by the determination that CMS made on mental health services provided via telehealth.

Grandfathered RHC Payment Methodologies


The Consolidated Appropriations Act of 2021 contained significant reforms to how RHCs are reimbursed by Medicare. As a result of this legislation, which we call the RHC payment modernization policy, the RHC upper payment limit, or cap, will rise to $190 by 2028. All RHCs that were previously uncapped are not necessarily subject to this limit, but are instead considered “grandfathered-in.”

Grandfathered RHCs which “as of December 31, 2020, was in a hospital with less than 50 beds and after such date such hospital continues to have less than 50 beds” receive clinic-specific per visit upper-limit payment rates based on their 2020 rates.

What CMS Proposed

CMS proposed that grandfathered RHCs use the cost reporting period that ends in calendar year 2020 to establish the clinic-specific upper payment limit. CMS wrote that they “interpret ‘per visit payment amount’ to align with the interim rate process the MACS use in determining an RHC’s AIR.”

CMS also proposed that beginning with RHCs enrolled in Medicare as of January 1, 2021, they would no longer permit RHCs to file consolidated cost reports.

What NARHC Commented

NARHC expressed appreciation for the direction that CMS provided in both guidance and rulemaking related to the operationalization of these significant RHC payment reforms.

We strongly suggested that the clinic specific upper payment limits should be based on the final cost-settled rates for cost report periods ending in 2020, or 2021 (for grandfathered RHCs that do not have cost reporting periods that end in 2020) not an interim rate to be appropriately reflective of individual clinic’s true costs. If an interim final rate is necessary for the time period before final cost settled rates are adjudicated, NARHC suggested that CMS set interim clinic specific upper limits only until such time that a final rate is established.

NARHC also requested that policies related to an RHC change of address or change of ownership be explicitly addressed in CMS guidance. We asked CMS to ensure that grandfathered RHCs could move and be sold from one (under 50 bed) hospital to another without losing their grandfathered status.

Finally, we asked CMS to reconsider their proposal regarding consolidated cost reports. Instead of prohibiting all new RHCs from consolidating their cost report, we asked that CMS simply prohibit combining grandfathered and non-grandfathered RHCs on the same cost report.

What CMS Finalized

  • CMS clarified that grandfathered RHCs should have upper payment limits based on their final cost settled rates. However, it is still not entirely to us what upper payment limits apply to grandfathered RHCs if they are waiting for the MACs to adjudicate their final rates from 2020/2021.
  • If an RHC undergoes a change of ownership (CHOW) or a change of address, the grandfathered status will be transferred, so long as the CCN and location requirements for RHCs are retained.
  • New RHCs enrolled after January 1, 2021 are permitted to file consolidated cost reports with other RHCs, so long as they also fall within the same national statutory payment limit; however, grandfathered and non-grandfathered RHCs cannot file consolidated cost reports.

Payment for Attending Physician Services Furnished
by RHCs to Hospice Patients


Currently, any hospice related service provided by RHC clinicians to hospice patients must be “carved out” of the RHC cost report and billed under Medicare Part B fee schedule as these services are not considered “RHC services.” This policy has discouraged and disincentivized RHC clinicians from providing hospice related care to hospice patients.

What CMS Proposed

CMS proposed to codify new statutory provisions as were introduced in the Consolidated Appropriations Act of 2021, permitting an RHC physician, NP, or PA employed by or working under contract with an RHC to provide hospice attending physician services and bill for these services as they would for any other qualitied service to be paid the RHC AIR, beginning January 1, 2022.

Separate from the rulemaking process, CMS issued guidance creating modifier GV. This modifier allows RHCs to indicate when the RHC practitioner is billing for hospice services.

What NARHC Commented

NARHC appreciates that RHC clinicians will now be able to provide these services and be reimbursed under the RHC AIR.

The proposed regulation text required that the RHC physician, PA, or NP be designated by the patient at the time of hospice election, and NARHC requested that this language be removed to allow hospice beneficiaries to change their attending physician at any time.

What CMS Finalized

  • Removed the phrase “at the time of election” as we requested to allow hospice beneficiaries to change their attending physician at any time.
  • Finalized these new statutory provisions as described in section 132 of the Consolidated Appropriations Act 2021.

Concurrent Billing for Chronic Care Management Services and
Transitional Care Management Services


RHCs are not currently permitted to bill for Transitional Care Management (TCM) services for a patient if another practitioner or facility has already billed for Chronic Care Management (CCM) services for that patient during the same time-period.

This applies to services described in the following HCPCS Codes which are updated annually based on the PFS rates:

  • G0511 (General Care Management for RHCs) – at least 20 minutes of qualified CCM or general Behavioral Health Integration (BHI) furnished to a patient in a calendar month.
  • G0512 (Psychiatric Collaborative Care Model (CoCM code for RHCs) – at least 70 minutes of initial psychiatric CoCM services or 60 minutes of subsequent psychiatric CoCM services are furnished to a patient in a calendar month.

What CMS Proposed

In order to reach consistency with the changes made in the CY 2020 PFS final rule for care management services billed under the PFS, CMS proposed to allow RHCs to bill for TCM and other care management services furnished to the same patient during the same service period (1 month in this case), provided that all requirements for billing each code are met.

What NARHC Commented

NARHC supported this proposal and its efforts to create more comprehensive care management plans for patients.

What CMS Finalized

  • Finalized the proposal to allow RHCs to concurrently bill TCM with other care management services.

NARHC will be hosting a webinar in early January 2022 covering all these new rules and policies. Please contact Sarah Hohman, NARHC Deputy Director of Government Affairs, or Nathan Baugh, NARHC Director of Government Affairs, with any questions or concerns.

Original Article 11/02/2021
Today, CMS released the CY 2022 Medicare Physician Fee Schedule Final Rule, finalizing or altering several key provisions originally proposed in July 2021.

NARHC submitted detailed comments on these provisions which were recognized and addressed in the Final Rule, including setting grandfathered RHC upper payment limits, RHC mental health services via telehealth, and payment for attending physician services furnished by RHCs to hospice patients.

We are currently completing a full analysis of the MPFS and will update this article with a break-down of these provisions and their impacts on RHCs soon.

Please stay up to date on key RHC news on and contact Sarah Hohman, NARHC Deputy Director of Government Affairs, or Nathan Baugh, NARHC Director of Government Affairs, with any questions or concerns.