Coding and reimbursement challenges for FQHCs

Since the mid-1960s, Community Health Centers have provided comprehensive, high‐quality preventive and primary health care to individuals regardless of their financial status. These centers have become integral in coordinating primary care and preventive services for millions across the United States.

Federally Qualified Health Centers (FQHCs) encounter distinct coding and reimbursement challenges. Given the multitude of issues affecting healthcare providers today, accurate and thorough documentation is essential to meet reporting requirements for evaluation and management visits, procedures, supplies, and other medical and ancillary services delivered by these organizations.

It is incumbent upon FQHCs to ensure precise coding for each patient’s visit. Nevertheless, some FQHCs may adopt an overly cautious approach when assigning procedure codes, resulting in undercoding. This practice is discouraged as it leads to significant revenue loss and distorted claims data, which ultimately reduces reimbursement rates. Furthermore, undercoding undermines the reported value of services rendered, which must be disclosed annually to the federal government. Accurate reporting not only fulfills regulatory obligations but also substantiates reimbursement amounts.

Challenges Faced by FQHCs

FQHCs are increasingly prominent within the healthcare landscape, offering primary care as well as multi-specialty services such as obstetrics/gynecology, mental health, vision, and dental care. The breadth of services provided presents complexities in managing billing and revenue cycles.

Staffing constitutes a major challenge in maintaining quality and accuracy. Securing qualified coders who possess expertise across multiple specialties is both difficult and essential. Additionally, reliance on part-time or volunteer providers can further complicate proficiency with electronic health record systems used in coding. Such providers may include retirees or recent medical school graduates who may not be fully familiar with coding principles, posing obstacles on the billing side.

Many FQHCs acknowledge gaps in internal knowledge and expertise required for proper coding across all service areas. Solutions include hiring experienced coders specialized in various fields or investing in training, both of which can incur substantial costs.

Another persistent issue is the considerable volume of claim denials. Insufficiently trained staff to address denials results in increased accounts receivable and a higher number of unresolved claims, adversely impacting provider operations and financial performance.

Strategies to Address Coding and Reimbursement Challenges

Comprehensive provider documentation is crucial for appropriate code selection. It is important to educate providers, coders, and billing staff about documentation standards. Regular training sessions for medical providers and billing teams represent an effective solution.

FQHCs must ensure that personnel possess expertise in billing and denial management. Outsourcing may be considered as an alternative to hiring and training full-time staff, offering a cost-effective approach to acquiring necessary experience and specialty knowledge.