New Medicare Billing Requirements - IOP Services for FQHCs, RHCs, and OTPs

Beginning January 1, 2024, the Centers for Medicare & Medicaid Services (CMS) have implemented new rules, established under Section 4124(c) of the Consolidated Appropriations Act of 2023 (CAA, 2023), that impact Medicare coverage and payment for Intensive Outpatient Program (IOP) mental health services provided through Federally Qualified Health Centers (FQHCs) and Rural Health Clinics (RHCs).

An IOP is a distinct and organized outpatient program of psychiatric services you provide for patients who have an acute mental illness, which includes, but isn’t limited to, conditions such as depression, schizophrenia, and substance use disorders.

For additional information, CMS has released a comprehensive guide for providers, “Billing Requirements for Intensive Outpatient Program Services for FQHCs and RHCs”.  These guidelines are related to:

  • Scope of Benefits: Clarification on the Medicare Eligible services related to IOP and mental health conditions in FQHC & RHC settings.
  • Certification and Plan of Care Requirements: Requirements related to the individualized treatment plan under which services are provided in FQHC & RHC settings.
  • Payment Policies: Clarification on the differences in how FQHC vs. RHC payment rates are established.
  • Coding and Billing Requirements: Clarification on how to appropriately code and bill IOP services in FQHC vs. RHC settings.

Additionally, the CY 2024 Hospital Outpatient Prospective Payment System and Ambulatory Surgical Center Payment System  final rule establishes a weekly payment adjustment for an Intensive Outpatient Program (IOP) provided by an Opioid Treatment Program (OTP) for opioid use disorder treatment; the IOP service:

    • Must be medically reasonable and necessary.
    • Can’t be duplicative of any service paid for under any bundled payments billed for an episode of care in a given week.
    • Is billed as an add-on code using G0137 – the details of the code requirements and the rate are outlined in the 2024 Medicare OTP Payment Rates.