KPI 8a: discounts on insured claims
Target zero
- 42 CFR 51c.303(g) requires full-fee billing to Medicare, Medicaid and insurers [7]
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FQHC revenue cycle management: the 12-KPI scorecard a board can actually read
Short answer: health centers are paid per qualifying visit, with a state wrap behind the plan payment and a sliding fee in front of the patient. Scorecards borrowed from fee-for-service miss all three. These twelve measures fit the PPS model, each with a formula, data source and owner.
12 KPIs · 5 bands4 files · 837, 835, wrap, PM ledger1 key · site, service line, rate yearBuilt in 30 days
Edition
1 · 2026
Focus
FQHC scorecard
Audience
CEO · CFO · Board
Metric
12 KPIs · 5 bands
Framework
PPS model
Length
12 min read
87%Medicaid charges
Collected nationally in 2025, a charge-master number, not a performance number [1]
34.16%Medicare add-on
For new patient, IPPE and AWV visits, applied after the geographic adjustment [3]
$207.72CY 2026 base
$4.16Bsliding discounts
Recorded nationally in 2025 against $7.04B of self-pay charges [1]
Collections as a share of full charges, UDS 2025 national data
Under PPS the charge master is not what gets paid, so cash divided by charges moves with pricing and sliding fee policy rather than with how well claims were worked.
Collections as a share of full charges by payer line, UDS 2025 (ASP-RCM arithmetic from Table 9D)
Medicaid $28.58B charged, $24.91B collected; Medicare $10.59B and $6.65B; self-pay $7.04B and $1.67B, with $4.16B of sliding fee discounts [1].
Medicaid, all lines$24.91B of $28.58B
87%charge-master driven
Total, all payers
68%
Medicare, all lines$6.65B of $10.59B
63%
Private, all lines
57%
Self-pay$1.67B of $7.04B
24%after $4.16B sliding discounts
0%25%50%75%100%
Collected share of chargesSelf-pay after sliding fee
Takeaway
None of those five percentages tells a board whether a single visit was paid what it was owed. That is the question a PPS scorecard has to answer.
Twelve measures in five bands: formula, cadence, owner
| # | KPI | Formula | Cadence | Owner |
|---|---|---|---|---|
| 1 | Net collection rate versus PPS, by payer class | Cash plus wrap received divided by PPS or APM expected value, per visit, by payer class and rate year | Monthly | Revenue cycle director |
| 2 | Encounter yield | Visits billed with a valid encounter line divided by face-to-face visits furnished by a qualifying practitioner | Weekly | Coding lead |
| 3 | Encounter-line denial rate | Encounter lines (T1015 or state trigger code) denied divided by encounter lines billed, in dollars and count | Weekly | Denials lead |
| 4 | Wrap recovery rate | Wrap received divided by wrap owed (PPS minus MCO paid), by MCO and rate year | Monthly | Finance |
| 5 | Wrap aging | Share of wrap owed that is more than two quarters past the date of service | Monthly | Finance |
| 6 | Medicare add-on capture | Visits billed G0466, G0468 or G0469 divided by visits that qualified as new patient, IPPE or AWV | Monthly | Coding lead |
| 7 | Lesser-of leak | Medicare encounter lines where the charge is below the geographically adjusted PPS rate | Quarterly | Charge master owner |
| 8 | Sliding-fee leakage | Discount dollars on insured claims (target zero) plus discount dollars posted to bad debt codes | Monthly | Patient accounts |
| 9 | Credentialing-hold AR | Dollars of claims held for practitioner enrollment, aged by days held | Weekly | Credentialing lead |
| 10 | Never-claimed and claim-error inventory | Open charges with no first claim date plus claims in error status, de-duplicated | Weekly | Billing manager |
| 11 | Cash per business day and median days to pay | Receipts divided by business days; median date of service to payment date | Weekly | Finance |
| 12 | Posting timeliness | Share of cash posted within 7 days of deposit; unapplied cash balance | Weekly | Posting lead |
5 bandsRate integrity, wrap, Medicare adjustments, front end, cash cycle
4 data files837 claims, 835 remittances, state wrap report, practice management ledger
1 keyEvery row keyed to site, service line and rate year
How one visit becomes one PPS payment, and where KPIs 2 and 3 sit
For managed care visits the expectation is the full PPS rate, not the plan's fee schedule: CMS's 2016 letter says the state owes the difference [6]. Maryland puts the cost-per-visit rate on the trigger line and $0.00 on every other line [8].
- 1VisitQualifying practitioner, face to face
- 2Encounter lineT1015 or the state trigger code plus a valid encounter code [9]
- 3AdjudicationPaid, denied or short
- 4ExpectedPPS or APM rate for the site and rate year, wrap included [6]
KPI 2
Encounter yield: line present on every qualifying visit
KPI 3
Encounter-line denials are whole-visit losses
KPI 1
NCR = cash plus wrap over expected value
YieldDenialsNet collection
| Rule | What it means for the scorecard | Source |
|---|---|---|
| Maryland pays up to four encounters per recipient per day: somatic, mental health, substance use disorder and dental | Encounter yield is counted per service line, not per patient day | [8] |
| Maryland MCOs reimburse the all-inclusive cost-per-visit rate, then reconcile with the state through encounter data | The expected MCO payment is the full rate; a short payment is a plan error, not a wrap item | [8] |
| Indiana: a materials-only eyeglass claim is not payable because the PPS rate for the exam already covers it | Do not count the second claim as a lost encounter; count it as a correct zero | [9] |
| Medicare pays more than one FQHC visit per day only for a subsequent illness or injury, or a medical visit plus a mental health or IOP visit | Medicare encounter yield has its own same-day rules | [5] |
Takeaway
In our published front-end case study, T1015 carried 57% of a network's 2026 denial dollars, and each denial was a whole-visit loss. KPI 3 exists because that pattern repeats.
The two clocks behind one managed care visit
Both KPIs run off the encounter-level variance file in our wrap payment reconciliation method; totals cannot produce either number. Under a full-PPS APM, KPI 4 does not disappear: states must continue reconciliation and oversight [6]; see the FQHC APM versus PPS decision guide.
Visit
Day 0
Qualifying encounter
MCO interim
Weeks later
Contract rate posted to the encounter row
Variance
Each month
- KPI 4: wrap received over wrap owed, by MCO and rate year
- KPI 5: share of wrap owed more than two quarters old, oldest rate year called out
NCR against PPS on Medicaid MCO visits
Published wrap case study
61%Before
94%After
Note$2.1M of wrap recovered in eleven weeks from an 18-month backlog
T1015 denial rate
Same case study
23%Before
2.1%After
Worked Medicare arithmetic at a GAF of 1.000
| Line | CY 2026 (final) | CY 2027 (proposed, not final) | Source |
|---|---|---|---|
| Base rate | $207.72 | $212.91 | [2] [10] |
| Established visit, G0467 or G0470 | $207.72 | $212.91 | [3] |
| New patient, IPPE or AWV, G0466, G0468 or G0469 (base x 1.3416) | $278.68 | $285.64 | [3] |
| Add-on left behind when a qualifying visit is billed as established | $70.96 | $72.73 | ASP-RCM arithmetic |
| Medicare pays 80% of the lesser of the charge or the PPS rate; no deductible | Charge below rate caps payment | Same rule | [4] |
Where the Medicare dollars sit per visit, CY 2026 (ASP-RCM arithmetic from CMS figures)
KPI 6 counts qualifying visits billed without the add-on; a new patient has not been treated by the organization in three years, across all sites [4]. KPI 7 is the lesser-of leak: any charge below the adjusted rate caps its own payment [4].
Adjusted visit, G0466 / G0468 / G0469base x 1.3416
$278.68+34.16%
Established visit, G0467 / G0470base
$207.72100%
Add-on at stake per missed flagKPI 6
$70.9625% of the adjusted visit
$0$100$200$300
AdjustedEstablishedLeft behind
FixesOur FQHC PPS new patient add-on post walks through the registration and coding fixes behind KPI 6.
Sliding fee, credentialing holds and the inventories counted once
The sliding fee rules come from 42 CFR 51c.303: a schedule of fees and discounts, full discount at or below the poverty guidelines, none above twice the guidelines, and full fees to third parties [7].
KPI 8b: discounts posted to bad debt
Code hygiene
- Nationally $4.16B of sliding discounts and $797M of bad debt on the self-pay line in 2025 [1]
- The split only holds if the adjustment codes are clean
KPI 9: credentialing-hold AR
Weekly aged list
- Claims for practitioners with incomplete enrollment cannot pay; show enrollment status next to each
KPI 10: never-claimed plus claim error
Counted once
- A charge can sit in both inventories, so the union is the number, not the sum
What the first 70 days found at a multi-site FQHC network (published case study)
Adding claim-error to never-claimed would have overstated the front-end problem by about 70%. Measure the union.
Claims returned for credentialing at go-livelargest workqueue; down 34% to $679K by July close
$1.035MKPI 9
Stuck before any payer, counted oncethe union
$968KKPI 10
No claim ever sent
$900K
Claim-error status
$746K
Overlap counted in bothsubtracted
$678K
$0$250K$500K$750K$1M
Credentialing holdUnion, the number to reportComponents
Replace gross collection rate with two measures that behave under PPS
Cash per business day
KPI 11
- Receipts divided by business days removes calendar noise
Median days to pay
KPI 11
- Date of service to payment date; shows the cycle speeding up without old balances inflating it
Posting timeliness
KPI 12
- Share of cash posted within 7 days of deposit; unapplied balance
- Cash unapplied for two weeks makes every other KPI read worse than it is
| Row | Show | Do not show |
|---|---|---|
| Headline | NCR versus PPS by payer class, 13-month trend | Gross collection rate |
| Wrap | Owed, received, aged by MCO and rate year | A single wrap total |
| Medicare | Add-on capture rate and lesser-of leak, in dollars | Charges by G code |
| Front end | Credentialing holds, never-claimed, claim error, counted once | The sum of the three |
| Cash | Receipts per business day and median days to pay | Monthly cash without business-day adjustment |
WeeklyCash per business day, median days to pay, credentialing holds, encounter yield, encounter denials
MonthlyNCR versus PPS, wrap recovery, wrap aging, add-on capture, sliding-fee leakage
QuarterlyLesser-of leak and charge master review against the next rate letter
Five blocks, in order
- 1Days 1 to 5Load the rate letters by site, service line and rate year; load the Medicare base rate and your GAF
- 2Days 6 to 12Build the encounter master from the 837s and match every 835 line to it
- 3Days 13 to 18Attach the state wrap file; compute PPS minus MCO minus wrap received per encounter
- 4Days 19 to 24Tag Medicare visits for new patient, IPPE and AWV eligibility and compare to the G code billed
- 5Days 25 to 30Run the sliding fee and front-end inventories; publish the first weekly and monthly views
Band 1
KPIs 1 to 3
Band 2
KPIs 4 and 5
Bands 3 to 5
KPIs 6 to 12
Rate integrityWrapMedicare, front end, cash
Three rules that keep the numbers honest
Keep the rate year on every rowSo a retroactive rate change can be reprocessed line by line; the FQHC rate calendar lists each state's reset date.
Reconcile to UDS Table 9D at year endSo the board sees one set of numbers.
Check the payer matrix before labelling a short payment a denialThe FQHC payer matrix carries each payer's expected behavior.
Send us the files if you want the twelve numbersRate letters and 90 days of 837, 835 and wrap files; we return the first scorecard with the variances marked. We run FQHC billing and revenue cycle services on this scorecard; scope at FQHC billing services, templates in the FQHC RCM toolkit, companions: wrap denials and the APM tracker.
Frequently asked questions
Why is gross collection rate the wrong KPI for an FQHC?
Because PPS pays a fixed amount per qualifying visit, not a share of charges. The national UDS 2025 Table 9D shows health centers collected 87% of Medicaid charges and 24% of self-pay charges, numbers driven by charge masters and sliding fee discounts rather than by collection effort. Net collection against the PPS expected value tells you whether each visit was paid what it was owed.
What should the Medicaid NCR be measured against?
The PPS or APM rate on your rate letter for that site, service line and rate year, including the state wrap for managed care visits. CMS's 2016 guidance confirms the state owes the difference between the managed care payment and the PPS amount, so the expected value of a Medicaid MCO visit is the full PPS rate, not the plan's fee schedule.
How do we measure missed Medicare add-ons?
Count the Medicare visits that qualify as new patient, IPPE or AWV, then count how many were billed with G0466, G0468 or G0469 rather than G0467 or G0470. CMS pays 34.16% more on qualifying visits, applied after the geographic adjustment, with one adjustment per day, so each missed flag is a known dollar amount.
What is sliding-fee leakage?
Two things. Discounts that reach an insurance claim, which 42 CFR 51c.303(g) prohibits because insurers must be billed on the full fee schedule, and discounts posted to bad debt instead of the sliding discount adjustment code, which distorts UDS Table 9D and hides the real patient collection rate.
How often should the scorecard run?
Weekly for the operating measures (encounter yield, T1015 denials, credentialing holds, never-claimed charges, cash per business day) and monthly for the rate and wrap measures that depend on remittance and state settlement files. The board pack is a monthly view of the same numbers with a 13-month trend.
- HRSA UDS 2025 National Data, Table 9D: Patient Service Revenue
- CMS MLN Matters MM14309: FQHC PPS and IOP payment rates, CY 2026 update (December 5, 2025)
- CMS, FQHC PPS Frequently Asked Questions (new patient, IPPE and AWV adjustment; lesser-of rule)
- 42 CFR 405.2462, Payment for RHC and FQHC services (eCFR)
- 42 CFR 405.2463, What constitutes a visit (eCFR)
- CMS State Health Official letter SHO #16-006 on FQHC and RHC supplemental payments under managed care (April 26, 2016)
- 42 CFR 51c.303, Project elements: schedule of fees and discounts (eCFR)
- Maryland Medicaid PT 66-26, FQHC and RHC Coding Guidelines (March 3, 2026)
- Indiana Health Coverage Programs bulletin BT2026114, FQHC and RHC billing for vision services (July 2, 2026)
- CMS fact sheet: Calendar Year 2027 Medicare Physician Fee Schedule proposed rule (July 14, 2026)
Medicaid $28.58B charged, $24.91B collected; Medicare $10.59B and $6.65B; self-pay $7.04B and $1.67B, with $4.16B of sliding fee discounts [1].
Want the twelve numbers for your center?
Send the rate letters and 90 days of claim, remittance and wrap files. We return the first scorecard with every variance marked, by site and service line.