24-531 New Federally Qualified Health Centers Alternative Payment Methodology Pilot Begins July 1, 2024
Date: 06/24/24
Learn about new payment requirements for services received by members at FQHCs participating in the pilot
The Department of Health Care Services (DHCS) has developed the state's new Alternative Payment Methodology (APM) for participating Federally Qualified Health Centers (FQHCs) to incentivize delivery system and practice transformation under a capitated reimbursement model. This new system aims to prioritize high-quality and cost-effective care that is coordinated, team-based, convenient to access and best meets members’ needs.
Beginning July 1, 2024, FQHCs participating in this APM move away from the traditional Prospective Payment System (PPS) method in which FQHCs are paid an amount predetermined through their cost reporting to DHCS for the service provided during a visit to a per member per month (PMPM) reimbursement method that front-load reimbursement to more closely aligns with evolving practice needs and effective delivery of health care services. The APM reimbursement method is designed to:
- Eliminate health disparities through anti-racism and community-based partnerships.
- Provide data-driven improvements that address whole person care.
Refer to the new APM for FQHCs to learn more.
Reimbursement through APM
FQHCs participating in the pilot receive payments that reward them for the value of—rather than the volume of—services provided.
- Each participating FQHC will receive monthly payments equivalent to their total projected PPS payment entitlement in the form of an APM per member per month (PMPM) rate.
- Reimbursement will be paid across all assigned members attributable to each managed care plan with whom the participating FQHC has contracted.
The table below identifies the three FQHCs that are active pilot participants as of July 1, 2024, along with their current (as of January 1, 2024) and future state PPS rate (effective on October 1, 2024). Note, DHCS rates are subject to change.
For current information on participating FQHCs, including updated rates and applicable NPIs, DHCS website under Data & Statistics > Reports > Rates Reports > FQHC and RHC Current Rates.
FQHC Name | PPS | PPS |
|---|---|---|
County of Santa Clara | $481.82 | $503.98 |
Harbor Community Health Centers | $256.56 | $268.36 |
Winters Healthcare Foundation, Inc. | $318.27 | $318.27 |
Payment Scenarios for contracted and non-contracted FQHCs with Health Net
If a participating physician group (PPG) has a member who is being treated at an FQHC that is participating in the APM, and the FQHC is:
- Contracted with Health Net, on behalf of Community Health Plan of Imperial Valley, the PPG should not make any additional payments to the FQHC as the cost of the service is included in the APM PMPM.
- Not contracted with the Plan, the PPG will need to pay the PPS rate for those services.
Members included in the APM
The APM PMPM rate covers services provided to most Medi-Cal managed care members. Members who are dual eligible in both Medicare and Medicaid are excluded.
Note, as new members are added to Medi-Cal managed care and assigned to FQHC APM clinics, the clinic will receive a PMPM for these members. For example, undocumented adults who are enrolled in a managed care plan in 2024 and assigned to APM clinics will result in a PMPM rate reimbursement to the clinic.
Covered services
The APM payment to participating FQHCs includes:
- All Medi-Cal services under the managed care plan contract and included in PPS (except dental services) that are provided by the FQHC. Some managed care benefits will be outside of the APM, such as Enhanced Care Management.
- All services included in the FQHC’s PPS rate and are covered services under the managed care plan contract. Note, specialty mental health services, including peer support, are not under the managed care plan contract.
Below are examples of covered services, including but not limited to:
- Acupuncture.
- Chiropractic to the extent it is in the managed care plan contract.
- Comprehensive Perinatal Services Program (CPSP) practitioner services.
- Early and Periodic Screening, Diagnostic and Treatment (EPSDT)/Child Health and Disability Prevention Program services.
- Mild to moderate behavioral health care.
- Optometry, if included if in the managed care plan contract.
- Podiatry.
- Primary care.
- Specialty care in the PPS (cardiology, ophthalmology, optometry, dermatology).
- Vaccine/select supplies included in the managed care plan contract and PPS.
Additional Information
Relevant sections of the provider operations manuals have been revised to reflect the information contained in this update as applicable. Provider operations manuals are available electronically in the Provider Library.
Providers are encouraged to access the provider portal online for real-time information, including eligibility verification, claims status, prior authorization status, plan summaries, and more.
If you have questions regarding the information contained in this update, contact Community Health Plan of Imperial Valley at 833-236-4141.
This information applies to Participating Physician Groups (PPGs).
This information applies to Medi-Cal in Imperial county.