A Turning Point for Telehealth in Rural Areas
In a country as large and diverse as the United States, policies don’t always align in ways that benefit all behavioral health clients. One such example was the Medicaid Four Walls policy, which created significant obstacles for behavioral health providers and the clients they serve, especially in rural areas.
By requiring that care happen within the “four walls” of certified clinic buildings, the rule restricted access for people who lacked transportation and lived far from clinics, or had other barriers to care such as complex schedules, work, and caregiving responsibilities.
Now, a long-awaited Medicaid Four Walls update is changing that. In November 2024, the Centers for Medicare and Medicaid Services (CMS) revised the Four Walls rule to allow more flexibility in how care is delivered, opening the door to behavioral health telehealth in rural areas in 2025.
What Was the Medicaid Four Walls Requirement?
The Four Walls requirement, enacted in 2016, limited Medicaid reimbursements to services rendered onsite, only inside of approved healthcare facilities. While designed to reduce fraud and misuse, it had the unintended consequence of excluding people in hard-to-reach rural and Tribal communities from receiving care—unless they could physically enter a clinic.
During the COVID-19 pandemic there was a period of flexibility for the Medicaid Four Walls policy. Some states used temporary waivers as a workaround for offsite care, while the Centers for Medicare and Medicaid Services (CMS) extended compliance grace periods for specific entities like the Tribal and Indian Health Services (IHS) clinics. But a permanent change was needed to reflect the growing role of telehealth in Medicaid provided behavioral health services.
The Impact of Changes to Behavioral Health Telehealth
The CMS revision is more than a policy shift—it’s a practical solution to several systemic challenges in the behavioral health landscape.
Telehealth in Rural Areas Improves Access
Rural regions often lack sufficient behavioral health infrastructure, leaving Medicaid beneficiaries with few nearby options for in-person care. Traveling to a Federally Qualified Health Center (FQHC) or Rural Health Center (RHC) can be a significant hardship for geographically isolated patients, older adults, or those with physical limitations. With limited public transportation and long distances to care, services are out of reach for many. Telehealth for behavioral health offers a practical solution to these hardships, allowing patients to access services from the comfort and safety of their own homes.
By lifting the Medicaid Four Walls restriction, CMS allows for broader use of behavioral health telehealth in rural areas, making it easier for patients to get the support they need.
Helping to Solve the Behavioral Health Workforce Shortage
According to a 2023 Bureau of Health Workforce Brief, roughly half of the U.S. resides in a Mental Health Professional Shortage Area (HPSA). This has contributed to providers turning patients away, and long wait times (48 days on average) for services. By enabling remote service delivery, the updated Medicaid Four Walls policy lets clinicians serve rural clients without needing to relocate—creating a more flexible, distributed workforce. Read more about the human services workforce shortage here.
Supporting Care Equity for Underserved Communities
The ability to increase services throughout rural communities is central to advancing care equity. Rural residents tend to have lower incomes and worse health outcomes compared to urban populations and rely more heavily on Medicaid (24% versus 22% in urban areas). Behavioral health telehealth supported by changes to the Four Walls policy helps level the playing field by giving more people timely, appropriate care right where they are.
Flexible Care for Busy Lives
The telehealth option is not just a necessity for those living in Mental Health HPSAs. Many Medicaid patients work multiple jobs, attend school, or provide care for aging parents or children, making it tough to schedule traditional in-person visits. Telehealth gives people more options to fit behavioral health into their busy lives.
Integrating Telehealth and EHR Software for Medicaid Behavioral Health Services
Offering telehealth in rural areas is most effective when using a capable Electronic Health Record (EHR) system. EHR platforms can simplify clinical operations, ensure Medicaid compliance, and improve the client experience—whether care is delivered in person or virtually.
Key benefits of using an EHR for behavioral health telehealth include:
- Efficient scheduling, notes, and billing all in one system to save your staff time
- Updates that reduce errors and miscommunication to keep your team in sync
- Higher client satisfaction from smooth virtual experiences and user portals
- Actionable analytics to improve care delivery and financial performance
- Automated audit trails that make processes easy to track and to support Medicaid compliance
The Bottom Line: A More Accessible Future for Behavioral Health
CMS’s revision of the Medicaid Four Walls rule empowers providers to meet patients where they are. For behavioral health professionals serving rural communities, this change removes longstanding geographic barriers, enabling more flexible care models and expanding access to critical services. The result? Greater provider reach, improved patient outcomes, and a more equitable behavioral health system, no matter the zip code.
Radicle Health’s EHR products have integrated telehealth capabilities to support Medicaid behavioral health services.
