In this section:
Primary Reviewer: Fiscal Expert
Secondary Reviewer: Governance/Administrative Expert (as needed)
Authority: Section 330(k)(3)(E), (F), and (G) of the Public Health Service (PHS) Act; and 42 CFR 51c.303(e), (f), and (g) and 42 CFR 56.303(e), (f), and (g)
Corresponds to Compliance Manual Chapter 16: Billing and Collections, including Billing and Collections Related Considerations
Documents the Health Center Provides
- Current fee schedule for each service (for example, medical, dental, behavioral health).
Note: The “fee schedule” is NOT the same as the sliding fee discount schedule (SFDS). The fee schedule is a list of charges for the services that are within the health center’s HRSA-approved scope of project. The fee schedule must be consistent with locally prevailing rates or charges and is designed to cover the reasonable costs of operations. - Data used to develop and update fee schedules based on health center costs and locally prevailing rates. For example, operating costs for service delivery, relative value units (RVUs) or other relevant data sources, Medicare and Medicaid cost reports.
- Sliding fee discount schedule (SFDS), including any SFDSs that differ by service or service delivery method.
- List of provider, program, or site billing numbers for Medicaid, CHIP, Medicare, or any other documentation of participation (for example, individual provider NPIs).
- Documentation of participation in any other public or private program or health insurance plans (for example, list or copy of third-party payor contracts including any managed care contracts).
- Billing and Collections policies or procedures (separate and distinct policies and procedures from those for the Sliding Fee Discount Program) and systems including:
- Provisions to waive or reduce fees owed by patients regardless of patient income level;
- Third-party payor billing procedures and contracts;
- Any policies on patients’ refusal to pay; and
- Procedures for notifying patients of any additional costs for supplies and equipment related to but not included in the service.
- Contracts with any outside organizations that conduct billing or collections on behalf of the health center.
- Eligibility, outreach, and enrollment procedures (for example, new patient registration and screening procedures).
- Current data on the following revenue cycle management metrics:
- Collection ratios;
- Bad debt write-off as a percentage of total billing;
- Collections per visit;
- Charges per visit;
- Percentage of accounts receivable (A/R) less than 120 days; and
- Days in A/R (for context on billing and collections efforts).
- Sample of at least 21 claims submissions and resubmissions to the health center’s most common third-party payors. At a minimum, this must include claims to Medicare, Medicaid, and CHIP:
- Randomly choose 7 claims submissions and resubmissions for patient visits from across at least 3 unique services (for example, routine primary care, preventive dental, behavioral health, obstetrics); and
- Within this sample, include at least 7 rejected claims.
- Report showing the last 6 months of claims data, specifically: the average filing time for the last 6 months of claims as well as the individual claims numbers, dates of service, dates claims were first billed, and filing times.
- Sample of at least 15 billing and payment records related to the health center’s charges to patients:
- Randomly choose 5 records for patient visits from across at least 3 unique services (for example, routine primary care, preventive dental, behavioral health, obstetrics);
- Ensure the sample includes patients with incomes at or below 200 percent of the Federal Poverty Guidelines (FPG); and
- If the health center has patients with incomes above 200 percent of the FPG include records for those patients.
- Sample of two to three billing records where patient fees or payments were waived or reduced.
- Documentation of methods for notifying patients of any additional costs for supplies and equipment related to but not included in the service.
- If the health center has a refusal to pay policy: Documentation of any cases in the past 24 months when the health center applied this policy.
Compliance Assessment
Select each element below for the corresponding text of the element, site visit team methodology, and site visit finding questions.
The health center has a fee schedule for services that are within the HRSA-approved scope of project and are typically billed for in the local health care market.
Site Visit Team Methodology
- Review the fee schedules.
- Compare the fee schedules to Form 5A.
- Interview CFO and financial or billing staff about the fee schedules.
- Review the data used to develop and update fee schedules.
Site Visit Findings
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Do all fee schedules include fees for all in-scope services typically billed for in the local health care market?
Notes:
- Services (for example, transportation, translation, other non-clinical services) on Form 5A that are not billed for in the local health care market may be excluded from the health center’s fee schedules.
- If patients pay a pharmaceutical dispensing fee, the dispensing fee is a service charge (not a supply) and is on the fee schedule. Prescription drugs are supplies that are related to, but NOT included in, the service itself as part of prevailing standards of care for the service and, therefore, are not on the fee schedule.
Response is either: Yes or No
If No, an explanation is required.
The health center uses data on locally prevailing rates and actual health center costs to develop and update its fee schedule.
Site Visit Team Methodology
- Review the fee schedules.
- Compare the fee schedules to Form 5A.
- Interview CFO and financial or billing staff about how the health center develops and updates its fee schedule.
- Review the data used to develop and update fee schedules.
Site Visit Findings
- Did the health center use data on locally prevailing rates and actual health center costs to develop its current fee schedules?
Response is either: Yes or No
If No, an explanation is required.
The health center participates in Medicaid, CHIP, Medicare, and, as appropriate, other public or private assistance programs or health insurance.
Site Visit Team Methodology
- Review the list of provider, program, or site billing numbers for Medicaid, CHIP, Medicare, or any other documentation of participation (for example, individual provider NPIs).
- Review the documentation of participation in any other public or private program or health insurance plans.
- Interview CFO and financial or billing staff about the health center’s participation in insurance programs.
Site Visit Findings
- Does the health center have documentation of its participation in Medicaid, CHIP, and Medicare?
Response is either: Yes or No
If No, an explanation is required.
- Does the health center participate in other public or private assistance programs or health insurance?
Response is either: Yes or No
If No, an explanation is required, including the health center’s justification for why it is not appropriate to participate in any other programs or insurance plans.
The health center has systems, which may include operating procedures, for billing and collections that address:
- Educating patients on insurance and, if applicable, related third-party coverage options available to them;
- Billing Medicare, Medicaid, CHIP, and other public and private assistance programs or insurance in a timely manner, as applicable;1 and
- Requesting applicable payments from patients, while ensuring that no patient is denied service based on inability to pay.
Site Visit Team Methodology
- Interview staff involved in the billing and collections process.
- Interview staff involved in educating patients about insurance options (for example, front desk staff, billing office staff, outreach and enrollment staff).
- Review the billing and collections systems, including third-party payor billing procedures and contracts.
- Review the contracts with any outside organizations that conduct billing or collections on behalf of the health center.
- Review the eligibility, outreach, and enrollment procedures (for example, new patient registration and screening procedures).
Site Visit Findings
- Did the health center explain how it educates patients about available insurance coverage options?
Response is either: Yes or No
If No, an explanation is required.
- Does the health center have systems in place for billing Medicare, Medicaid, CHIP and other public and private assistance programs or insurance?
Response is either: Yes or No
If No, an explanation is required.
- Does the health center have systems in place for collecting balances owed by patients?
Response is either: Yes or No
If No, an explanation is required.
- When requesting payments from patients, do the health center’s billing and collections systems and procedures ensure that no patient is denied service based on inability to pay?
Response is either: Yes or No
If Yes OR No, an explanation is required, including describing the systems or procedures.
If a health center elects to offer additional billing options or payment methods (for example, payment plans, grace periods, prompt or cash payment incentives), the health center has operating procedures for implementing these options or methods and for ensuring they are accessible to all patients regardless of income level or sliding fee discount pay class.
Site Visit Team Methodology
- Review the billing and collections systems and related procedures for any additional billing options or payment methods.
Site Visit Findings
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Does the health center offer additional billing options or payment methods? For example, payment plans, grace periods, or prompt or cash payment incentives.
Response is either: Yes or No
If Yes, an explanation is required specifying what additional billing options or payment methods are offered by the health center.
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IF YES: Does the health center have operating procedures for implementing these options or methods?
Response is: Yes, No, or Not Applicable
If No, an explanation is required.
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Does the health center ensure these options or methods are accessible to all patients regardless of income level or sliding fee discount pay class?
Notes:
- This includes patients with incomes above 200 percent of the Federal Poverty Guidelines.
- Additional discounts for any out-of-pocket costs incurred by insured patients are subject to potential legal and contractual restrictions on discounts specified by applicable Federal programs, state programs, or private payor contracts.
Response is: Yes, No, or Not Applicable
If No, an explanation is required.
The health center has billing records that show claims are submitted in a timely and accurate manner to the third-party payor sources with which it participates (Medicaid, CHIP, Medicare, and other public and private insurance) in order to collect reimbursement for its costs in providing health services2 consistent with the terms of such contracts and other arrangements.
Site Visit Team Methodology
- Review the sample of claims submission and resubmission data.
- Review the third-party payor billing procedures.
- Review the current data on the revenue cycle management metrics.
- Interview CFO and staff involved in the billing and collections process.
Site Visit Findings
- Does the health center submit claims within an average of 14 business days from the date of service?
Response is either: Yes or No
If No, an explanation is required stating the timeline for claims submissions and how the health center ensures timely submission of claims to third-party payors.
- Does the health center correct and resubmit claims that have been rejected or denied due to accuracy?
Response is either: Yes or No
If No, an explanation is required, including specifying any cases in which Medicaid, CHIP, Medicare, or any other third-party payor has suspended payments to the health center and why.
The health center has billing records or other forms of documentation that reflect that the health center:
- Charges patients in accordance with its fee schedule and, if applicable, the sliding fee discount schedule (SFDS);3 and
- Makes reasonable efforts to collect such amounts owed from patients.
Site Visit Team Methodology
- Interview CFO and staff involved in the billing and collections process.
- Review the fee schedules and the corresponding SFDSs.
- Review the billing and collections systems and any related procedures.
- Review the current data on the revenue cycle management metrics.
- Review the sample of billing and payment records related to the health center’s charges to patients.
Site Visit Findings
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Are patients billed for services using the health center’s fee schedules and are the correct discounts applied to these charges?
Note: Health centers that provide discounts to patients with incomes above 200 percent of the Federal Poverty Guidelines (FPG) may do so, as long as these discounts are supported through other funding sources (for example, Ryan White Part C award). Refer to Health Center Program Compliance Manual Chapter 16: Billing and Collections for more information.
Response is either: Yes or No
If No, an explanation is required.
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Does the health center attempt to collect amounts owed for charges, co-pays, nominal charges, or discounted fees? For example, the health center sends statements for outstanding balances or makes phone calls.
Response is either: Yes or No
If No, an explanation is required.
The health center has and utilizes board-approved policies, as well as operating procedures, that include the specific circumstances when the health center will waive or reduce fees or payments required by the center due to any patient’s inability to pay.
Site Visit Team Methodology
- Interview CFO and staff involved in the billing and collections process.
- Review the policies and procedures that contain provisions to waive or reduce fees owed by patients.
- Review the sample of billing records where patient fees or payments were waived or reduced.
Site Visit Findings
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Does the health center have policies and procedures on waiving or reducing fees or payments?
Note: If the board has not approved these policies, address this under Board Authority. 4
Response is either: Yes or No
If No, an explanation is required.
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Do the health center’s policies and procedures include a provision stating the circumstances or criteria for when fees or payments will be waived or reduced based on a patient’s inability to pay (regardless of patient income level)?
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17.1 The circumstances or criteria for when fees or payments will be waived or reduced based on a patient’s inability to pay?5
Response is either: Yes, No, or Not Applicable
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17.2 That the policies and procedures apply to all patients, regardless of income level and regardless of eligibility for sliding fee discounts or for nominal fees?
Response is either: Yes, No, or Not Applicable
If Yes OR No for any of the above, an explanation is required, including specifying any circumstances or criteria for waiving or reducing fees or payments.
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Does the health center:
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18.1 Follow the provisions in its policies and procedures for waiving or reducing fees or payments?
Response is either: Yes, No, or Not Applicable
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18.2 Apply its policies and procedures uniformly to ALL patients, regardless of patient income level or eligibility for sliding fee discounts?
Response is: Yes, No, or Not Applicable
If No to any of the above, an explanation is required. If the health center has no billing records where patient fees or payments were waived or reduced, an explanation is also required.
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If a health center provides supplies or equipment that are related to, but not included in, the service itself as part of prevailing standards of care6 (for example, eyeglasses, prescription drugs, dentures) and charges patients for these items, the health center informs patients of such charges (“out-of-pocket costs”) prior to the time of service.7
Site Visit Team Methodology
- Interview staff involved in billing.
- Review the billing procedures and methods for notifying patients of any additional costs for supplies and equipment related to but not included in the service.
- Note: While health centers are not required to provide sliding fee discounts for supplies and equipment that are related to but not included in a health center service (for example, casting materials, bandages, and lab supplies), all in-scope services themselves must be available on a sliding fee discount schedule. For example, if a patient has a denture fitting visit, the visit would be discounted in accordance with the sliding fee discount schedule; however, the dentures could be charged at cost or discounted in another manner.
Site Visit Findings
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Does the health center charge patients for supplies or equipment (for example, eyeglasses, dentures, insulin pump) related to but not included in the service?
Response is either: Yes or No
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IF YES: Does the health center have a method for notifying patients about out-of-pocket costs for those supplies or equipment, before providing the service?
Response is: Yes, No, or Not Applicable
If No, an explanation is required.
If a health center elects to limit or deny services based on a patient’s refusal to pay, the health center has a board-approved policy that distinguishes between refusal to pay and inability to pay and notifies patients of:
- Amounts owed and the time permitted to make such payments;
- Collection efforts that will be taken when these situations occur (for example, meeting with a financial counselor, establishing payment plans); and
- How services will be limited or denied when it is determined that the patient has refused to pay.
Site Visit Team Methodology
- Interview staff responsible for billing and collections.
- Review the billing and collection policies and procedures.
- Review any policies on patients’ refusal to pay.
- Review the documentation of any cases in the past 24 months when the health center applied its refusal to pay policy.
Site Visit Findings
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Does the health center elect to limit or deny services to patients who refuse to pay?
Response is either: Yes or No
Note: If the health center does not elect to limit or deny services to patients who refuse to pay, the remainder of the questions for this element are not applicable.
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IF YES: Does the health center have a refusal to pay policy?
Note: If the board has not approved this policy, address this under Board Authority.8
Response is: Yes, No, or Not Applicable
If No, an explanation is required.
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Does the health center:
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23.1 Distinguish between refusal to pay and inability to pay in the health center’s policy?
Response is: Yes, No, or Not Applicable
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23.2 Notify patients of amounts owed and the time permitted to make payments?
Response is: Yes, No, or Not Applicable
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23.3 Notify patients of collection efforts that may be taken (for example, meeting with a financial counselor, establishing payment plans)?
Response is: Yes, No, or Not Applicable
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23.4 Notify patients how services may be limited or denied when the patient has refused to pay?
Response is: Yes, No, or Not Applicable
If Yes OR No was selected for any of the above, an explanation is required, including specifying whether the health center has a policy or procedure that addresses each area.
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In cases where the health center has limited or denied services to one or more patients due to refusal to pay in the past 24 months, were the determinations consistent with health center policies or procedures?
Response is: Yes, No, or Not Applicable
If Yes OR No, an explanation is required, including how the determinations were made.
Footnotes
1. For information on Federal Tort Claims Act (FTCA) coverage in cases where health centers are using alternate billing arrangements in which the covered provider is billing directly for services provided to covered entity patients, refer to the FTCA Health Center Policy Manual (PDF - 406 KB), Section I: E. Eligibility and Coverage, Coverage Under Alternate Billing Arrangements.
2. This includes services that the health center provides directly (Form 5A: Services Provided, Column I) or provides through a formal written contract/agreement (Form 5A: Services Provided, Column II).
3. Refer to [Health Center Program Compliance Manual] Chapter 9: Sliding Fee Discount Program for more information on the SFDS.
4.The governing board of a health center operated by Indian tribes, tribal groups, or Indian organizations under the Indian Self-Determination Act or Urban Indian Organizations under the Indian Health Care Improvement Act is exempt from the specific board authority requirements discussed in [Health Center Program Compliance Manual] Chapter 19: Board Authority. Section 330(k)(3)(H) of the PHS Act.
5. Examples of circumstances that could temporarily or permanently impact a patient’s ability to pay include, but are not limited to, housing status; natural disasters; long-term hospitalization; inability to access funds; intimate partner violence; job loss or other sudden loss of income; change in marital status; or large medical bills.
6. These items differ from supplies and equipment that are included in a service as part of prevailing standards of care and are reflected in the fee schedule (for example, casting materials, bandages).
7. Refer to [Health Center Program Compliance Manual] Chapter 15: Financial Management and Accounting Systems for related information on revenue generated from such charges.
8. The governing board of a health center operated by Indian tribes, tribal groups, or Indian organizations under the Indian Self-Determination Act or Urban Indian Organizations under the Indian Health Care Improvement Act is exempt from the specific board authority requirements discussed in [Health Center Program Compliance Manual] Chapter 19: Board Authority. Section 330(k)(3)(H) of the PHS Act.