Implementing Value-Based Primary Care Delivery in Federally Qualified Health Centers

Federally Qualified Health Centers (FQHCs), like many health systems, are in transition toward alternative/advanced payment and reimbursement models. Gradually, fee-for-service reimbursements will be replaced by value-based payments with shared accountability for patients' health care outcomes. This article provides a description of an FQHC Primary Care Collaborative (FPCC) model and preliminary outcomes. This collaborative is an advanced payment model resulting from a partnership between Priority Partners Managed Care Organization (PPMCO), Maryland Community Health System, LLP, and 7 Maryland FQHCs. The FPCC model builds on shared measurable health care outcomes to establish an advanced care delivery model that is tailored to the needs of providers and their patients. PPMCO provided prospective payments to the 7 FQHCs based on their patient population size and total historical cost. Each FQHC had specific health outcomes targets for each fiscal year (FY) to maintain funding. Although FQHC implementation approaches varied, the FQHCs used their payments primarily for outreach and care coordination resources, and to develop processes and structures to improve care delivery outcomes. A 3-year assessment of this program revealed a 35% reduction in emergency department visits and an 11% reduction in hospitalizations for Medicaid beneficiaries across all 7 FQHCs. The FPCC 3-year investment of $4.4M yielded a cumulative cost savings of $19.4M, resulting in a cumulative 3:1 return on investment. There is limited evidence for implementation and outcomes of non-state, Medicaid payer-specific, advanced payment models in FQHCs. This article provides a collaborative framework other Medicaid managed care organizations can adopt and build on.