Beyond G2025: How RHCs and FQHCs Must Prepare for the Next Phase of Telehealth Billing
A major telehealth billing change is on the horizon for RHCs and FQHCs. With CMS phasing out G2025 and requiring service-level telehealth coding beginning October 2026, healthcare organizations must prepare for new reporting requirements, modifier usage, and reimbursement methodologies. Discover what these changes mean for compliance, revenue integrity, and future telehealth operations.--------------------------
Telehealth has evolved from a temporary pandemic-era solution into a permanent component of healthcare delivery. As utilization continues to grow, the Centers for Medicare & Medicaid Services (CMS) is refining how telehealth services are reported and reimbursed. One of the most significant upcoming changes affects Rural Health Clinics (RHCs) and Federally Qualified Health Centers (FQHCs), which will soon transition away from the long-standing use of HCPCS code G2025 for distant site telehealth services.
Beginning October 1, 2026, RHCs and FQHCs will enter a new billing framework that requires greater coding specificity, more detailed documentation, and closer alignment with the Physician Fee Schedule (PFS). While the change may appear administrative on the surface, its impact extends into reimbursement accuracy, compliance, revenue forecasting, and operational workflows.
Why CMS Is Changing Telehealth Billing Requirements
For several years, RHCs and FQHCs have billed Medicare for non-behavioral health distant site telehealth services using a single HCPCS code—G2025. This simplified approach helped providers rapidly expand telehealth access during a period of extraordinary demand.
However, as telehealth becomes a more permanent fixture within the healthcare system, CMS is moving toward a reporting structure that better reflects the actual services provided. By requiring providers to bill the specific CPT® or HCPCS Level II code associated with each telehealth encounter, CMS gains greater visibility into utilization patterns, service complexity, and reimbursement appropriateness.
The transition represents a broader effort to integrate telehealth services more closely with traditional Medicare payment methodologies while maintaining access for rural and underserved populations.
What Changes on October 1, 2026?
Starting October 1, 2026, RHCs and FQHCs will no longer report HCPCS code G2025 for non-behavioral health distant site telehealth services.
Instead, providers must report the individual CPT® or HCPCS code that accurately describes the service performed during the telehealth encounter.
In addition to the service code, providers must submit the appropriate revenue code and include the telehealth modifier that reflects the communication method used during the visit:
Modifier 93
Synchronous Telemedicine Service Rendered via Telephone or Other Real-Time Interactive Audio-Only Telecommunications System
This modifier should be used when the telehealth encounter occurs through audio-only technology that meets CMS requirements.
Modifier 95
Synchronous Telemedicine Service Rendered via Real-Time Interactive Audio and Video Telecommunications System
This modifier should be reported when the service is delivered through a live, interactive audio-video platform.
Accurate modifier selection will become increasingly important, as it directly affects claims processing, reimbursement integrity, and compliance monitoring.
The Operational Impact for RHCs and FQHCs
The shift from a single telehealth billing code to service-specific coding introduces new operational considerations for revenue cycle teams.
Organizations that previously relied on G2025 will need to ensure providers, coders, and billing staff can accurately identify and report the appropriate telehealth service codes. This may require updates to charge capture workflows, coding protocols, electronic health record templates, and billing software configurations.
Healthcare organizations should also evaluate whether their current documentation practices adequately support the increased coding specificity required under the new framework.
Failure to properly document service complexity, modality of care, or provider involvement could increase the risk of claim denials, payment delays, or compliance concerns.
Understanding the New Payment Methodology
CMS has also outlined how distant site telehealth services will be reimbursed under the updated model.
For non-behavioral health telehealth services furnished by RHCs and FQHCs, CMS will:
- Update the payment rate annually
- Calculate the rate using the average payment amount for telehealth services included on the Physician Fee Schedule telehealth list
- Weight the calculation based on actual service volume under the Physician Fee Schedule
- Apply a national payment methodology rather than adjusting payments by geographic locality
This approach creates a more standardized reimbursement structure while preserving CMS's objective of maintaining telehealth access across different regions.
Patient Cost-Sharing Considerations
The new policy also maintains specific patient cost-sharing requirements.
For RHC services, patient coinsurance and deductibles generally continue to apply. For FQHC services, coinsurance requirements remain in place.
CMS will calculate patient coinsurance based on the lesser of:
- The established payment rate, or
- The provider's submitted charges
Importantly, preventive services that qualify for cost-sharing waivers will continue to be exempt from coinsurance and deductible requirements.
Providers should ensure front-office teams and patient financial services departments understand these requirements to support accurate patient communication and billing transparency.
Telehealth Flexibilities Extended Through 2027
While billing requirements are changing, CMS has also provided welcome news regarding telehealth access.
The Consolidated Appropriations Act of 2026 extended key telehealth flexibilities, allowing RHCs and FQHCs to continue serving as distant site telehealth providers through January 1, 2028.
Additionally, through calendar year 2027, federal law requires CMS to maintain payment methodologies that are comparable to national average telehealth reimbursement rates under the Physician Fee Schedule.
This extension provides organizations with additional stability as they navigate the billing transition and continue investing in telehealth infrastructure.
Provider Eligibility and Scope of Practice
CMS continues to permit qualified RHC and FQHC practitioners to furnish distant site telehealth services within their authorized scope of practice.
Eligible practitioners may provide approved telehealth services from any location while working on behalf of the RHC or FQHC, provided the services are included on the Medicare telehealth services list and meet applicable program requirements.
This flexibility remains an important tool for expanding healthcare access in rural, underserved, and geographically isolated communities.
Preparing for the Transition: Key Steps for Revenue Cycle Leaders
Although October 2026 may seem distant, healthcare organizations should begin preparing now to avoid disruption when the new requirements take effect.
Key preparation steps include:
Review Telehealth Service Inventories
Identify the telehealth services currently billed under G2025 and map them to the appropriate CPT® and HCPCS codes.
Update Documentation Standards
Ensure providers document telehealth encounters with sufficient detail to support service-level coding and modifier selection.
Train Coding and Billing Teams
Provide education on telehealth modifiers, revenue code requirements, and claim submission changes.
Assess Technology Readiness
Verify that EHRs, practice management systems, and billing platforms can accommodate the new reporting requirements.
Conduct Internal Audits
Perform periodic telehealth coding reviews before implementation to identify compliance gaps and reduce reimbursement risk.
Looking Ahead
The retirement of HCPCS code G2025 marks a significant milestone in the ongoing maturation of telehealth reimbursement. While the transition introduces additional complexity for RHCs and FQHCs, it also reflects CMS's commitment to integrating telehealth more fully into mainstream healthcare delivery.
Organizations that proactively update their workflows, strengthen documentation practices, and prepare their revenue cycle teams will be better positioned to maintain compliance, minimize reimbursement disruptions, and continue delivering high-quality virtual care to the communities that depend on them.
The Organizations That Prepare Early Will Have the Advantage
Every year, coding updates become more complex as healthcare technologies, treatment modalities, and documentation requirements continue to evolve. Organizations that wait until implementation deadlines approach often find themselves dealing with productivity slowdowns, coding inconsistencies, increased denials, and avoidable compliance risks.
The most successful healthcare organizations treat coding updates as a strategic revenue cycle initiative—not simply a coding department responsibility.
At Bristol Healthcare Services, we help healthcare organizations stay ahead of change through comprehensive coding support, documentation improvement programs, coding audits, compliance reviews, and revenue cycle optimization services. Our certified coding professionals continuously monitor regulatory and coding developments, helping clients prepare for updates before they impact reimbursement and operational performance.
From ICD-10-PCS implementation support and coding quality assurance to ongoing revenue cycle management, Bristol serves as an extension of your team—helping ensure that every procedure is accurately documented, coded, and reimbursed.
As procedural coding continues to evolve, having the right expertise in place can make the difference between reacting to change and gaining a competitive advantage from it.