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FQHC Billing Service

The Complete Guide To FQHC Billing

FQHCs are a valuable resource in the healthcare industry. They provide quality care at an affordable price and improve your bottom line. Federally Qualified Health Centers are an essential source of health care in rural areas because they provide services to at-risk populations who don’t have access to other medical care providers. These non-profit organizations provide primary care to underserved populations and receive federal grants and comprehensive health services. In this guide, you’ll learn everything you need to know about FQHC billing.

What Is An FQHC?

FQHC stands for Federally Qualified Health Center. FQHCs are non-profit organizations that provide treatment to underserved and low-income populations. FQHCs obtain federal grants in exchange for health services to underserved and uninsured people and cost-based reimbursement rates for Medicaid patients and malpractice insurance. These practices expand Medicaid and Medicare coverage. 

What Is FQHC Medical Billing?

Medical billing and coding must follow the rules established by the Centers for Medicare and Medicaid (CMS) and the Health Resources and Services Administration (HRSA) because FQHCs are federally funded. The services provided at FHQCs must be meticulously captured and billed for the facility to receive the necessary reimbursement and maintain a healthy revenue cycle. An FQHC medical billing company handles the problematic medical billing and coding tasks while complying with the demanding requirements. These experienced billers and coders understand Medicare and Medicaid requirements, guaranteeing clean claims, increased profits, and fewer days in A/R. FQHCs are reimbursed comprehensively under Medicare and Medicaid, though they can bill specific services differently with adequate codes and documentation. Other FQHC requirements include:

  • Collect the 20% Medicare coinsurance (no Part B deductible applies).
  • The FQHC provider must provide after-hours care.
  • Use a fee structure based on federal poverty guidelines.

Medical billing companies must submit FQHC medical billing claims with the correct CPT, HCPCS, Revenue, and appropriate “T” codes to avoid denials. Understanding of Wrap billing concept is critical for obtaining faster reimbursement. 

What Are The Advantages Of FQHC Status?

Health centers are eligible for a variety of benefits if certified as an FQHC by the Centers for Medicare & Medicaid (CMS), including:

  • Medicare reimbursement under a Prospective Payment System (PPS), in which Medicare payment is made based on a national rate that is adjusted for the location where services are provided. CMS provides a high-level overview of the FQHC PPS.
  • Medicaid reimbursement through the Prospective Payment System (PPS) or another state-approved Alternative Payment Methodology (APM). 

Who Is Eligible For FQHC Services?

The services of an FQHC can be used by anyone who is uninsured, underinsured, or has a low income. To be eligible for Medicaid or CHIP, you must meet the following criteria:

  • Be a resident of the state in which the FQHC is located.
  • Have no employer-sponsored insurance coverage (i.e., Medicare). If you have Medicare but are still living with your parents and don’t want to pay for it yourself, then you’ll need to get an exemption from them first before applying for Medicaid/CHIP benefits. 

FQHCs may accept Medicaid patients below the federal poverty level (FPL) and without health insurance coverage. They also accept Medicare beneficiaries with limited incomes who do not qualify for Medicaid or want to keep their current plan through Medicare Advantage (also known as Original Medicare). 

What Distinguishes FQHC Billing From Traditional Medical Billing Services?

FHQCs are compensated for their services on an all-inclusive basis by Medicare and Medicaid. FQHCs struggled to obtain fair payment for their services, with more claim denial rates and lost revenue than traditional healthcare centers that accept commercial insurance. Many features of FQHC billing are exceptional, including:

  • Sliding fees scale
  • Reimbursement based on cost
  • Rates of encounter
  • Payment bundles
  • Medicare reimbursement PPS

All claims for services rendered at an FQHC must also include HCP and HCPCS coding, which differs significantly between Medicare and Medicaid. As CMS releases updates, these billing and coding variations are constantly changing. Because of the complexities of FQHC billing, it is critical for FQHCs to closely examine their revenue cycle and make adjustments that will assist their growth strategy. Lost revenue and high denial rates can impede these centers’ growth, making it critical to determine the root cause of denials and resolve them with experienced medical billers and coders to maximize their revenue cycle.

Tips For Smooth FQHCs Billing Procedure

The billing and revenue procedure is rarely simple regarding Federally Qualified Health Centers. FQHCs must adhere to specific and often complex billing requirements due to their federal funding and regulatory status. Furthermore, many of their patients are uninsured, making the collection more difficult than in regular hospitals and medical centers. These are tips to ensure a smooth and streamlined FQHC billing process.

Sliding Fees Include in FQHC Fees

FQHCs are paid more for Medicare and Medicaid patients, but they must also charge a sliding fee to those who do not have insurance. A financial assessment determines whether a patient is eligible for reduced prices. There are several methods for determining how much to charge patients for discounted slides. Still, applying an all-inclusive fee to each slide is the most suitable option, depending on the patient’s eligibility. Furthermore, you should consider the cost of each service provided by an FQHC. This allows you to provide services at a lower cost while maintaining revenue.

Check the Patient’s Eligibility

Insurance companies and patients with good payment records typically pay FQHCs. Some clinics recognize Medicare, Medicaid, and third-party payers like Managed Care Organizations (MCO), Health Maintenance Organizations (HMOs), and Preferred Provider Organizations (PPO) (PPOs). Before preparing the bill, ensure that you understand who will pay your claims; otherwise, you will face substantial unpaid claims from patients who are not insured. To avoid this issue, request proof of insurance or a third-party payer ID number before handling their bills. Verifying the patient’s eligibility before offering services is critical because this specifies how the services will be paid. You must also ensure that all necessary authorizations or referrals are in position. You can also check your eligibility with your billing company if you outsource your billing. They should be able to help you with any queries about eligibility verification.

Use the proper CPT codes for FQHC billing.

CPT codes help to streamline reporting and claims processing. Unfortunately, the massive amount of numbers and letters can make coding challenging, and incorrect FQHC coding is the primary source of claim rejections.

Medical coding accuracy is improved by combining technology and coding expertise. Claim scrubbers can match all of the guidelines on claims with the services provided. The program alerts you to any dissimilarities and instructs you to correct them. An experienced medical coder can review the findings, confirm them, and make corrections.

Understand your bundles and claim forms

The billing procedure can be challenging because there are specific processes for filing claims. Coding services for FQHCs necessitate knowing which CPT codes relate to more integrated solutions, such as bundled services. The Health Resources and Services Administration creates documentation to assist coders and billing staff to determine which services can be billed as part of a qualifying visit rather than at a basic fee-for-service rate. Revenue and bill codes are also most likely to differ, necessitating a billing team’s ability to distinguish between the claims filing procedures for each type of payer, visit, and service. Staff must be capable of handling both regular billing and FQHC billing procedures at the same time.

Use Appropriate Modifiers 

Modifiers ensure proper billing and offer additional details about a process. Using the incorrect modifiers may impact reimbursement rates and result in time-consuming denials. Appropriate coding saves you time and effort in appealing denied claims.

Outsource Your FQHC Billing Process

Outsourcing your FQHC medical billing process allows you to increase revenue collection while decreasing payment turnaround time. With an outsourced team of certified coders and billing professionals, you can predict fewer denials, better cash flow, greater patient satisfaction, and faster medical billing. It can also save you time training your employees and reduce their workload.


We hope this guide has helped answer some of your questions about FQHC billing and the process behind it. If not, then we will be happy to answer any other questions you may have! We are always here for you with our help desk or by calling us at 866-886-6130.

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