FQHCs are used to running flat-out to stretch their limited resources so they can meet ever-growing needs in their communities. It takes skill, determination, and persistence to operate in a chaotic community health environment, always rushing from one appointment to the next and one crisis to another.
Whether you consider this fast-paced environment exhilarating or exhausting, it’s the fundamental reality of patient care – which is why it’s not surprising that clinical leaders tend to expect that the business side of healthcare should move as quickly as they do every day.
Editor's note: This was originally published in January 2022, and reviewed and updated in July 2023.
Ten years on from the Affordable Care Act, however, we have learned a very important lesson about healthcare transformation: it’s become abundantly clear that value-based care is a marathon, not a sprint.
Over the past decade, policy makers, providers, and industry partners have been putting one foot in front of another to get to our ultimate goal of better outcomes, lower costs, and improved experiences.
And after all this time and effort, we finally have an idea of what the finish line should look like and how we can get there together.
As of 2021, more than 36 million individuals are receiving care from providers participating in a Medicare, Medicaid, or commercial ACO. This figure doesn’t include individuals getting services from providers participating in other value-based initiatives, such as Primary Care First (the successor to CPC+), the new direct contracting program from the CMS Innovation Center, and a wide variety of state-level innovations in the Medicaid space.
Value-based care will always be a long-term challenge that will require patience and persistence, but it’s clear that momentum is building faster and faster as time goes on. It’s time for FQHCs to lace up their running shoes before the rest of the pack gets too far ahead.
Download our easy-to-use checklist for FQHCs getting started with value-based care.
Why value-based care will benefit FQHCs in the long run
Like it or not, value-based care is here to stay
CMS has been all-in on value-based care since 2012. Commercial health plans soon followed, as have many state Medicaid agencies. In states like New York, for example, more than two-thirds of managed care organization spend is tied to value as part of the state’s Delivery System Reform Incentive Payment (DSRIP) Program, dramatically exceeding the national average of 36 percent.
Nationally, the percentage of payments delivered through value-based reimbursement models has been growing every year as state leaders and commercial insurance plans echo the bipartisan support for value-based care at the federal level. The need for healthcare payment reform is one of the few things both sides of the aisle can agree on, which is why policymakers are pursuing value-based care so steadfastly across multiple administrations.
It’s a matter of when, not if, value-based care will become an imperative for your FQHC. Gearing up now for the inevitable may be the smartest move you can make, especially because…
More experience with value-based care is directly correlated with more shared savings
Value-based care does take time, but that time pays off for providers who stick with it. Since the early days of ACOs, researchers have proven that provider organizations that spend more time in value-based care models are significantly more likely to see higher shared savings and increased incentive payments.
In 2016, ACOs with four years of experience in the Medicare Shared Savings Program (MSSP) achieved shared savings at nearly double the rate of ACOs in their first participation period.
Several years later, we can see that the amount of shared savings money delivered back to providers is increasing significantly even as the number of ACOs in the Medicare program has dropped slightly.
- Net program savings pushed past $1.86 billion in 2020 compared to benchmarks, even though the number of ACO participants dropped by 5 percent from 2019 levels
- 67 percent of ACOs received shared savings bonuses in 2020 compared to just 50 to 57 percent of ACOs in 2019
- ACOs generated approximately $190 in net savings per beneficiary in 2020, compared to just $85 to $88 in 2019
The positive results are partly because more mature ACOs (the average ACO was 4.4 years old) are more comfortable taking on downside risk arrangements – and have become more adept at reaping the rewards from these challenging models.
It certainly has been a long road for these organizations, but persistence has paid off in measurable dividends, including incentive payments and better outcomes for their patients.
If you want to shape the future, you need to have a seat at the table
FQHCs haven’t always been happy with the way value-based care has played out. In the earlier days of healthcare transformation, policymakers largely focused on hospitals, health systems, and big private practices, leaving community health out in the cold.
This has led to the perception that there’s no place for FQHCs in the emerging reimbursement ecosystem, but that notion couldn’t be further from the truth.
Mature and extremely successful initiatives in regions across the country, including Oregon, Washington State, Illinois, and California focus primarily on community health centers serving Medicaid beneficiaries and the uninsured.
Since 2013 in Oregon, more than half of the state’s FQHCs have been receiving up-front capitated per member per month (PMPM) payments to supplement a base encounter fee and deliver enhanced, flexible benefits to patients. The payments are partially based on key quality measures for chronic disease management and preventive care and have produced measurable improvements in colorectal cancer screenings (up 15 percent) and depression screenings with follow-up (a 21 percent increase).
In the same year in Minnesota, 10 urban FQHCs in the Minneapolis–St. Paul area formed the Federally Qualified Health Center Urban Health Network (FUHN), which contracts with Medicaid to earn shared savings payments aligned with 9 groups of quality measures. The participants have seen a 26 percent reduction in inpatient admissions and a 34 percent drop in ED visits while earning $23.6 million in shared savings through 2017.
These programs clearly illustrate that FQHCs don’t have to sit on the sidelines. They have an important role to play in the development and success of value-based reimbursement, particularly at the state level.
The pioneering community health centers taking part in these initiatives are using their experiences to influence policy and define best practices for the next generation of value-based care. If you don’t join the conversation now, you are at risk of losing your opportunity to inform the policies, procedures, and shared savings models of the future.
Working together with other FQHCs through an independent provider association (IPA) or other collaborative structure can give voice to community health centers, open up access to new contracting opportunities, and allow front-line providers to advocate for necessary changes and improvements to the healthcare industry.
FQHCs have a unique opportunity to jump into the race at the perfect moment. The road has been marked out; the path is becoming increasingly well-traveled, yet there are still countless opportunities for community health leaders to find their stride and make their mark on the next generation of value-based care.
To learn more about getting started on your journey to value-based care, schedule a personal consult with Yuvo Health.
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