The Centers for Medicare and Medicaid Services has released a proposed rule to establish methodology and payment rates for a prospective payment system for services provided at federally qualified health centers under Medicare Part B, starting in October 2014. The new PPS is required under the Affordable Care Act.

Under the rule, CMS proposes a national encounter-based payment rate for all FQHCs for professional services furnished per beneficiary per day, saying the rate will be appropriate while remaining administratively simple. The encounter-based rate would be calculated based on an average cost per visit (total FQHC cost divided by total FQHC encounters) using Medicare cost report and claims data. The rate, however, would be adjusted for geographic differences. There are provisions for beneficiaries being treated more than once in a given day at the same center.

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