Rural Health Clinic Financial Performance and Productivity

Research center:
Lead researcher:
Project funded:
September 2015
Project completed:
November 2019

The Rural Health Clinic (RHC) program faces a number of significant policy challenges including:

  1. Questions regarding the continued fit between the program's historic mission of ensuring geographic access to primary care services for Medicare and Medicaid beneficiaries and the evolving healthcare needs of rural communities.
  2. Concerns about the extent to which RHCs are prepared to participate in evolving quality management and practice transformation activities.
  3. A growing backlash against cost-based reimbursement by MedPAC and others.
  4. Concerns from a 2014 study by the Office of the Inspector General (OIG) indicating that 12 percent of RHCs nationally no longer met the program location requirements in 2013.

Limited available data on program performance makes it difficult for policymakers to monitor its impact and for rural stakeholders to advocate on its behalf. This study used Medicare cost reports for independent and provider-based clinics to provide a detailed national picture of the financial and operational performance of RHCs and describe variations in performance related to revenue, costs, staffing, payer mix, productivity levels, and hours of operation across independent and provider-based clinics. The project also developed measures that can be used to benchmark RHC performance over time.


  • Rural Health Clinic Costs and Medicare Reimbursement
    Policy Brief
    Maine Rural Health Research Center
    Date: 11/2019
    We used cost report data to examine Rural Health Clinic (RHC) services costs. The findings support the National Advisory Committee on Rural Health & Human Service's conclusion that the cost-based methodology used to determine Medicare reimbursement for RHCs is outdated and RHCs subject to the reimbursement cap are paid less than their costs.