CMS Pub. 100-02, ch. 13, § 70.3

Medicare pays 80 percent of the lesser of the FQHC’s charge or the FQHC PPS payment

rate for the specific payment code, unless otherwise noted. Except for grandfathered

tribal FQHCs, the FQHC PPS payment rate reflects a base rate that is the same for all

FQHCs, a geographic adjustment based on the location where services are furnished, and

other applicable adjustments as described below. The 2015 and 2016 FQHC PPS base

rates were updated by the MEI. Beginning in 2017, the FQHC PPS rate is updated

annually by the FQHC market basket. To receive payment for qualified services, HCPCS

coding is required on all claims.

Geographic Adjustment: The PPS base rate is adjusted for each FQHC based on its

location by the FQHC Geographic Adjustment Factor (FQHC GAF). The PPS payment

rate is the PPS base rate multiplied by the FQHC GAF for the location where the service

is furnished. Since the FQHC GAF is based on where the services are furnished, the

FQHC payment rate may differ among FQHC sites within the same organization. FQHC

GAFs are updated periodically and can be found at:

https://www.cms.gov/Center/Provider-Type/Federally-Qualified-Health-Centers-FQHC-

Center.html.

New Patient Adjustment: The PPS payment rate is adjusted by a factor of 1.3416 when

an FQHC furnishes care to a patient who is new to the FQHC. A new patient is someone

who has not received any Medicare-covered professional health service (medical or

mental health) from any site within the FQHC organization, or from any practitioner

within the FQHC organization, within the past 3 years from the date of service.

IPPE and AWV Adjustment: The PPS payment rate is adjusted by a factor of 1.3416

when an FQHC furnishes an IPPE or an AWV to a Medicare beneficiary.

NOTE: These adjustments do not apply to grandfathered tribal FQHCs.