CMS Finalizes 2023 Regulatory Updates

Sarah Hohman, NARHC Director of Government Affairs


In November 2022, the Centers for Medicare and Medicaid Services (CMS) issued the CY 2023 Medicare Physician Fee Schedule (MPFS) Final Rule. This year’s rule finalizes several Rural Health Clinic (RHC) policies originally proposed in July 2022, which NARHC summarized here.

Following our analysis, NARHC submitted comments to CMS on each RHC or RHC-related provision. While CMS considered and incorporated many of our comments, we continue to lack clarity on several important regulatory provisions.

“It was a bit of a quiet year for RHC-specific policy,” said Nathan Baugh, Executive Director of NARHC. “We were hoping for more issues to be clarified in the physician fee schedule rules this cycle and I remain flummoxed as to why CMS has not yet found a way to allow RHCs to do remote patient monitoring. We did get some key questions surrounding cost reporting for grandfathered RHCs solved, but we have a myriad of coding and reporting issues, from the G2025 telehealth system to our lack of ability to use category II CPT codes, that are still on our list of issues to solve with CMS.”

For a detailed summary of the RHC-relevant provisions of the 2023 MPFS and Outpatient Prospective Payment System (OPPS) final rules please see below:

RHC Payment Methodology

The Consolidated Appropriations Act of 2021 contained significant reforms to the way RHCs are reimbursed by Medicare. As a result of this legislation, also known as the RHC payment modernization policy, the RHC upper payment limit, or statutory payment cap, will rise by $13 until it reaches $190 in 2028. All RHCs that previously received fully uncapped reimbursement are considered “grandfathered-in” and receive clinic-specific upper-limit payment rates based on their 2020 rates.

CMS has been responsive to stakeholder comments as these new payment methodologies have been implemented. Further details on issues clarified in the 2022 Medicare Physician Fee Schedule, such as change of ownership implications, can be found here. Previous rules had not addressed whether cost reports must span a full 12 consecutive month period, or if payment limits could be determined based on a shortened cost report period.

What CMS Proposed
In the 2023 MPFS proposed rule, CMS proposed that in setting clinic-specific upper payment limits for RHCs which had an All-Inclusive Rate (AIR) established for services furnished in 2020, MACs should use the cost report ending in 2020 that reports costs for 12 consecutive months. In the event that the RHC does not have a cost report ending in 2020 that reports on 12 consecutive months of cost data, MACs should use the next most-recent final settled cost report that reports costs for 12 consecutive months. For those RHCs that did not have an AIR established for services furnished in 2021, MACs are directed to use the cost report ending in 2021 (or the next most-recent final settled cost report) that again, reports costs for 12 consecutive months.

NARHC commented in support of this proposal. While limited in the number of RHCs it will impact, we believe it will ensure that grandfathered RHCs in these categories will have the most accurate payment limit base moving forward. CMS finalized these policies as proposed.

New Care Management Codes Billable in RHCs

Since 2016, RHCs have been able to bill for Chronic Care Management (CCM) services and over the last several years, the services eligible for reimbursement have expanded.

During CY 2022, RHCs bill HCPCS code G0511 for any of the services described by codes 99484, 99487, 99490, 99491, 99424, and 99426. G0511 pays a consolidated fee schedule amount, $79.25 in 2022, which is the average of the Physician Fee Schedule (PFS) rate for these CCM and principal care management (PCM) services furnished by a physician or other qualified
health care professional. The 2023 reimbursement amount has not yet been released.

What CMS Proposed
CMS aims to establish new care management codes for Chronic Pain Management
(CPM) and General Behavioral Health Integration (GBHI) described as the following:

General Behavioral Health Integration

“Care management services for behavioral health conditions, at least 20 minutes of clinical psychologist or clinical social worker time, per calendar month, with the following required elements: initial assessment or follow-up monitoring, including the use of applicable validated rating scales; behavioral health care planning in relation to behavioral/psychiatric health problems, including revision for patients who are not progressing or whose status changes; facilitating and coordinating treatment such as psychotherapy, coordination with and/or referral to physicians and practitioners who are authorized by Medicare law to prescribe medications and furnish E/M services, counseling and/or psychiatric consultation; and continuity of care with a designated member of the care team.”

Chronic Pain Management

“(1) HCPCS codes GYYY1: Chronic pain management and treatment, monthly bundle including, diagnosis; assessment and monitoring; administration of a validated pain rating scale or tool; the development, implementation, revision, and maintenance of a person-centered care plan that includes strengths, goals, clinical needs, and desired outcomes; overall treatment management; facilitation and coordination of any necessary behavioral health treatment; medication management; pain and health literacy counseling; any necessary chronic pain related crisis care; and ongoing communication and care coordination between relevant practitioners furnishing care, e.g. physical therapy and occupational therapy, and community based care, as appropriate. Required face-to-face visit at least 30 minutes provided by a physician or other qualified health professional; first 30 minutes personally provided by physician or other qualified health care professional, per calendar month. (When using GYYY1, 30 minutes must be met or exceeded.)

and (2) HCPCS code GYYY2: Each additional 15 minutes of chronic pain management and treatment by a physician or other qualified health care professional, per calendar month).”

What NARHC Commented
In our comments, we expressed appreciation that CMS continues to expand the care management services billable under the G0511 code. As a general rule of thumb, we believe that providers should be able to provide the same suite of services in the RHC setting as fee-for-service providers are able to provide in a traditional office setting.

However, for services that meet the definition of an RHC encounter: a face-to-face encounter between a patient and an RHC practitioner during which a qualified service is furnished, we believe RHCs should bill an RHC encounter and be reimbursed at the RHC’s AIR, not through G0511 or another methodology.

We emphasized that care management services, telehealth services, and others could all be reimbursed through the RHC’s AIR if CMS were to revise the definition of an RHC medical visit, like they did with an RHC mental health visit in the 2022 MPFS. We remain concerned that a bundled approach (i.e., G50011, G5012, G0071, and G2025) serves as a band-aide solution to the core problem: an outdated definition of a “medical visit.” As more and more services are added to this list and new bundles are created, the reimbursement rules for RHCs only get more confusing. We encourage you to read our submitted comments for the full rationale.

What CMS Finalized
Firstly, CMS finalized HCPCS codes G3002, G3003, and G0323 to replace placeholder codes GYYY1, GYYY2, and GBHI1 respectively and corresponding.

In response to our comments, they explained the following:

“We agree that the description of HCPCS code G3002 includes a face-to-face component. As explained in the CY 2023 PFS proposed rule (87 FR 45936 through 45937), to value CPM, we compared the proposed services to codes that involve care management. In doing so, we concluded that the CPM services were similar in work (time and intensity) to that of PCM in that both the PCM codes and proposed CPM codes reflected services that have similar complexities, possible comorbidities, require cognitive time on the part of the practitioner, and may involve coordination of care across multiple practitioners. Therefore, in an effort to pay the same for similar services, and for RHCs and FQHCs we pay PCM using HCPCS code G0511, we did not believe it is appropriate to pay CPM as a visit. After consideration of public comments, we have reconsidered our approach to billing CPM services. Many Medicare beneficiaries have multiple chronic conditions, and many of these conditions could involve chronic pain. We believe it is reasonable to assume that in many instances, the RHC or FQHC practitioner could be spending time with the Medicare patient discussing health and wellness related to a variety of conditions that a person may be experiencing, or expect to experience, and that interaction might also have a focus on the chronic pain aspects of the person’s care. Addressing chronic pain as part of a visit would complete the face-to-face component of CPM. Billing of HCPCS code G0511 would address the non-face-to-face components of CPM. Therefore, both the face-to-face visit and the non-face-to-face components of CPM as an add-on service(s) could be on the same day if all requirements to report each service are met, without time or effort being counted more than once. We believe having the ability to bill both a face-to-face visit and a non-face-to-face CPM add-on service on the same day mitigates concerns from the commenters since payment for the RHC or FQHC visit accounts for the face-to-face component and payment for non-face-to-face CPM services accounts for the additional time and resources necessary for the unique components of care coordination for non-face-to-face CPM services furnished outside of the face-to-face visit with an RHC or FQHC practitioner. Therefore, we are finalizing as proposed to include non-face-to-face CPM services described in HCPCS code G3002 in the general care management HCPCS code G0511 when these services are furnished by RHCs and FQHCs.

While it makes sense to pay G3003 (the additional fifteen-minute intervals of CPM services) through G0511, it remains unclear to us whether G3002 can be billed with modifier CG and paid the RHC’s AIR as an RHC encounter for the initial thirty minutes that is required to be face-to-face. NARHC is seeking further clarification from CMS on this issue.

Medicare Economic Index (MEI) Rebasing

While not specific to RHCs, but utilized in the setting of RHC payment limits, the MPFS also finalized a proposal to rebase the Medicare Economic Index (MEI) for CY 2023, utilizing a 2017 base year, as opposed to the previous 2006-based MEI. The MEI “reflects the weighted-average annual price change for various inputs involved in furnishing physicians’ services.” With minor technical changes related to cost weights of physician compensation and practice expenses, CMS finalized the CY 2023 MEI update of 3.8 percent.

NARHC recognizes that this increase remains significantly behind the high inflation rates that are impacting providers today. CMS believes that this proposed methodology, and its use of publicly available, more frequently updated data sources will be more reflective of current market conditions and the health care industry’s “changing practice patterns.” For additional details on the complex MEI calculation and data inputs, begin reading at page 69688 of the MPFS final rule.


The final rule implements the various telehealth provisions established in the Consolidated Appropriations Act of 2022, and makes necessary technical changes in the regulation for the following:

  • The temporary Public Health Emergency (PHE) medical telehealth flexibilities including reimbursement through G2025, removal of originating and geographic site requirements, and audio-only provision of services are extended for 151-days post PHE. We still await legislative action to make all Medicare telehealth services permanent. With the continued extensions of the PHE, it is unlikely that Congress will make any immediate decisions on permanent telehealth flexibilities.
  • The in-person requirement for mental health visits furnished via telehealth, which can now be permanently offered by RHCs, is also waived for 151-days post PHE.

Note: The RHC distant site reimbursement (G2025) will be $95.88 in 2023. NARHC frequently updates telehealth resources, including 2023 reimbursement rates for telehealth services here.

What is Still Missing

Unfortunately, CMS did not use this rulemaking opportunity to provide clarity on a variety of topics that impact RHCs. Below is a brief list of the issues that we continue to seek clarity on for the RHC community:

  • Permitting RHCs to bill for Remote Patient Monitoring (RPM) and Remote Therapeutic Monitoring (RTM)
    • CMS continues to indicate that they “will continue to evaluate and may consider these for future rulemaking.”
  • Annual Wellness Visit as Separate Medical Visit
  • Telehealth Services Billed G2025 versus Billed as Mental Health Telehealth Services and Reimbursed at AIR
  • Details Related to Post-PHE Mental Health Telehealth In-Person Visit Requirements

Simultaneously, we are seeking updates to key guidance documents such as Medicare Benefit Policy Manual Chapter 13 and State Operations Manual Appendix G that reflect out-of-date information and definitions.

This winter, NARHC will engage in meetings and listening sessions with individuals from CMS who cover RHC payment policy and survey and certification issues on these topics and more. We will continue to keep the RHC community updated of any new guidance or clarification on these issues.

2023 Hospital Outpatient Prospective Payment System
This fall, NARHC also submitted comments regarding the new CMS facility type, Rural Emergency Hospital (REH), following the release of proposed REH Conditions of Participation. Specifically, we wanted to ensure that the CoPs were aligned with legislative intent as established in the Consolidated Appropriations Act of 2021 when the REH model was created.
We urged CMS to make it explicitly clear that Critical Access Hospitals and small rural hospitals that convert to REHs may retain ownership of rural health clinics. As stated in the CAA of 2021, “a rural emergency hospital may be considered a hospital with less than 50 beds for purposes of the exception to the payment limit for rural health clinics under section 1833(f).”

In the 2023 Hospital Outpatient Prospective Payment System (OPPS) Final Rule, CMS agreed with these comments and finalized that “provider based RHCs that were previously entitled to excepted [grandfathered] status under section 1861(kkk)(6)(B) of the Act may maintain this status when their associated hospital converts to an REH.”

Additional final rule provisions on the new REH model, including payment policies and enrollment can be found here.

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