Health Reformer's Lexicon: Federally Qualified Health Centers

The Health Reformer's Lexicon is a weekly feature that will examine key words, terms and phrases in health reform and explore their meaning and orbit.

The term: Federally Qualified Health Centers (FQHCs)

The Centers for Medicare & Medicaid Services provides the following definition:

FQHCs are “safety net” providers such as community health centers, public housing centers, outpatient health programs funded by the Indian Health Service, and programs serving migrants and the homeless.

Under the supervision of certified medical professionals, like doctors and psychologists, FQHCs offer primary care and preventive services, such as screenings for cholesterol, visual acuity and hearing; prenatal care; immunizations; and mental and nutritional evaluations.

Funded through the Health Centers Consolidation Act, FQHCs must be public or private nonprofit organizations. To receive the designation and qualify for grant funding, they must meet a number of other requirements.

Care can be provided in a number of settings: at health centers, at patients’ homes or elsewhere in the community, and must be provided to all patients regardless of their ability to pay for it.

FQHCs Payments are determined using a sliding fee scale. And as our Health Reform GPS also notes,

… because of their location and high level of treatment of the uninsured, FQHCs receive special payment rates from Medicare, Medicaid and CHIP and are eligible for special supplemental payments from exchange-participating health insurance plans. 

Why it matters: Federally qualified health centers provide care to millions of uninsured, underinsured and non U.S. citizen populations. As access to care expands through health reform, so too will the need for safety net providers. To do so, the federal government will need to work closely with the states to connect people to services and address the primary care workforce shortage.

According to a Health Affairs article, it is estimated that FQHCs will provide care for twenty million people in 2010, about 40 percent of whom will be uninsured. 

Roots: The Economic Opportunity Act of 1964 called for “neighborhood health centers,” which spurred the creation of the first two centers–one in the Mississippi Delta and the other in Boston–in 1965. These early models were based on similar ones in South Africa and also inspired by the American civil rights movement and a growing need to address national poverty issues.

The federal government continued to increase its support for health centers, and eventually created a reimbursement designation–the Federally Qualified Health Center benefit, in 1991. 

More recently, thanks to the support of President Bush’s Health Center Initiative, federal grants for FQHCs increased from $1.1 billion in 2001 to $2.2 billion by 2009, and the number of patients who received care doubled in number. 

Where the term appears: The Patient Protection and Affordable Care Act calls for the establishment of “Teaching Health Centers,” which include FQHCs; it also calls for support to help address the primary care workforce shortage, especially in rural and underserved areas.

The bill also contains $11 billion in funding for health centers, over a period of five years, starting in 2011. According to the National Association of Community Health Centers,

$9.5 billion of this funding will allow health centers to expand their operational capacity to serve nearly 20 million new patients and to enhance their medical, oral, and behavioral health services. $1.5 billion of this funding will allow health centers to begin to meet their extraordinary capital needs, by expanding and improving existing facilities and constructing new sites.
 
Previous Lexicon entries include:
- Value-Based Purchasing
- High-Risk Pools
- Bundled Payments