Industry Update – The Federal Shutdown Continues: Key Updates and Action Steps for FQHCs
As we take on the final quarter of 2025, FQHC leadership is navigating one of the most dynamic operational landscapes in recent memory. From federal funding uncertainty and policy overhauls to reimbursement updates and the launch of the Rural Health Transformation (RHT) Program — the pace of change is high and the stakes are even higher.
In our last update, we outlined the major policy shifts taking effect October 1, 2025. This month, we revisit where we left off, share new developments, and highlight what your leadership teams can do right now to stay ahead and keep your organization stable, compliant, and ready for what’s next.
Where we left off from previous updates: quick recap
Grant Policy Updates: As of 10/1/2025, HHS has aligned with 2 CFR 200 and its own HHS-specific rules under 2 CFR 300.
GrantSolutions Transition: HRSA began transitioning from the Electronic Handbook (EHB) to GrantSolutions, though the rollout has now been delayed.
FY 2026 Grant Cycles: New deadlines are in effect, and some grantees have received extensions to move to a four-year project period.
Federal Budget Status: The Federal Budget expired September 30, 2025, and the government has been in shutdown since then.
Updated OSV Resources: HRSA released refreshed materials to support operational site visits – Health Center Program Site Visit Protocol | Bureau of Primary Health Care
Rural Health Transformation (RHT) Program: State applications are now open and moving forward.
What’s New and Actionable Now
1. Federal Government Shutdown: We are entering the fourth week of the federal government shutdown. Despite ten Senate votes on a continuing resolution, no agreement has been reached to reopen the government.
FQHC drawdowns continue to be processed.
CMS has issued a temporary hold on payments for certain telehealth services that cannot be confirmed as behavioral or mental health services.
Action Items:
Monitor for updates: Stay current on CMS communications – All Fee-For-Service Providers | CMS
Track drawdowns and plan for delays: Build in cash-flow buffers and review reserve levels.
Engage in advocacy efforts: Coordinate with your state PCA and national associations to share your organization’s story.
Strengthen risk mitigation: Partner with your board and senior leadership to scenario-plan for potential funding delays or policy shifts.
Stay compliant: Continue all reporting and audit functions as scheduled. Coordinate with your board and senior leadership on risk mitigation: establish scenario planning for delays or shifts in state/federal policy.
2. Billing and Reimbursement:
Code G0511 (general care coordination) is no longer valid for FQHCs and RHCs after September 30, 2025.
FQHCs should now bill specific CPT/HCPCS codes for care coordination services (including advanced primary care management, chronic care management, remote monitoring, etc.) instead of the bundled G0511 code.
CMS’s CY 2025 payment structure includes a 3.4% productivity-adjusted market basket update for FQHCs.
Action Items:
Audit your systems: Identify where G0511 is still active and transition to the appropriate CPT/HCPCS codes.
Train your teams: Ensure billing and clinical staff understand care coordination code use (CCM, TCM, RPM, RTM, etc.).
Validate your EHR and clearinghouse setups: Confirm that billing workflows are updated to prevent claim denials or missed revenue.
Run test claims: Validate payment flow before large-scale billing changes.
3. Compliance Considerations: The HHS Grants Policy Overhaul effective October 1, 2025, introduces several key changes:
Micro-purchase threshold: increased to $50,000
Equipment/Supply threshold: $10,000
Fixed-amount subawards: permitted up to $500,000 (with prior approval)
Single audit threshold: raised to $1 million
Additionally:
GrantSolutions transition remains delayed.
Delinquent audit policy: Awardees delinquent on two or more Single Audit Reports will now have a 120-day condition applied to all active awards.
Action Items:
Review HRSA’s Grant FAQs: Grant FAQs | HRSA
Update internal compliance calendars: Assign ownership for monitoring sub-awards, audit deadlines, and closeouts.
Revise policies: Align procurement, contract management, and indirect cost processes with new thresholds.
Train fiscal and grants staff: Reinforce awareness of the new thresholds and risk implications.
Stay alert for system updates: Continue monitoring GrantSolutions at HRSA | HRSA
4. Rural Health Transformation (RHT) Program
NOFO was released for states on September 15, 2025
State applications are due November 5, 2025
Awards will be announced by December 31, 2025
Action Items:
Track your state’s progress: Watch for publication of the state’s transformation plan and opportunities for stakeholder input.
Engage early: Offer input on how funds might flow to FQHCs and community-based organizations.
Align strategy: Identify how your organization’s work aligns with RHT priorities around access, sustainability, and workforce.
Final Thought
The next few months will test the flexibility and foresight of every FQHC leadership team. The ongoing shutdown, compliance overhaul, and reimbursement transitions all require clear communication, disciplined planning, and proactive financial monitoring.
Community Link Consulting continues to help FQHCs translate regulatory changes into operational strategy, ensuring your organization doesn’t just stay compliant, but stays strong.
If your team needs support with scenario planning, compliance alignment, or cashflow strategy during this period of uncertainty, reach out to our team. Together, we can navigate what’s next with clarity, confidence, and collaboration.
About the Author
Amy Brisson, Chief Strategy Officer
Community Link Consulting
Phone: 509-226-1393
Email: info@communitylinkconsulting.com
Amy combines over 15 years of progressive financial leadership experience with 11 years of specialized FQHC industry expertise to guide health centers through complex federal policy transitions and compliance requirements. Her deep understanding of grants management, federal funding cycles, and rural healthcare transformation initiatives positions her as a trusted advisor for FQHCs navigating regulatory changes and positioning for new funding opportunities like the Rural Health Transformation Program.
