The Consolidated Appropriations Act, 2021 (CAA), passed in December 2020, included a major change to the way Rural Health Clinics (RHCs) are reimbursed for services rendered to patients. Section 130 of the CAA, entitled “Improving Rural Health Clinic Payments,” included a provision that increased the Medicare cost-per-visit cap for new independent or provider-based RHCs on an annual basis.
As of January 1, 2026, the cap increases by $13 to $165 per visit. The cap also is set to increase annually until the maximum rate of $190 per visit is reached in 2028. After that point, the Medicare reimbursement cap will increase at a rate equal to the Medicare Economic Index (MEI). Specifically, the reimbursement caps by year will be:
| Beginning | Ending | Rate |
|---|---|---|
| 1/1/2021 | 3/31/2021 | $87.52 |
| 4/1/2021 | 12/31/2021 | $100.00 |
| 1/1/2022 | 12/31/2022 | $113.00 |
| 1/1/2023 | 12/31/2023 | $126.00 |
| 1/1/2024 | 12/31/2024 | $139.00 |
| 1/1/2025 | 12/31/2025 | $152.00 |
| 1/1/2026 | 12/31/2026 | $165.00 |
| 1/1/2027 | 12/31/2027 | $178.00 |
| 1/1/2028 | 12/31/2028 | $190.00 |
| 1/1/2029 | 12/31/2029 | $190.00 + MEI |
It should be noted that RHCs are not guaranteed to receive the increased rates. If an RHC’s actual cost-per-visit, as set by the Medicare cost report, is less than the cap, then the clinic will be reimbursed at the lesser of the two.
RHCs that are provider-based to hospitals with fewer than 50 beds, and were certified after December 31, 2020, also are subject to a cap to their all-inclusive rate reimbursement. Previously, these RHCs were able to receive uncapped cost-based reimbursement, and the specific rate was calculated using the Medicare cost report. Provider-based entities that applied to become an RHC prior to December 31, 2020 were granted grandfathered status and are not subject to the new per-visit cap established by the CAA.
How Healthcare Organizations Can Respond
Healthcare organizations that either currently operate under RHC designation, or are considering applying for RHC designation, should carefully consider how these caps will impact their reimbursement programs in 2026 and beyond, as the increasing cost-per-visit caps may represent an increased reimbursement opportunity compared to traditional Medicare Part B reimbursement. Organizations should also consult with their cost report preparers to prepare an estimate of the impact on current or future RHCs.
How Forvis Mazars Can Help
Our experienced professionals at Forvis Mazars help new and existing RHCs identify opportunities to improve reimbursement and performance. If you have any questions about RHC reimbursement methodology or eligibility requirements, or would like assistance estimating the financial impact of converting to RHC status, please reach out to a professional on our team.