Funder: California Health Care Foundation

Author: Greg Howe, Tricia McGinnis, and Rob Houston, Center for Health Care Strategies

June 2020 | Brief


Federally qualified health centers (FQHCs) are an essential part of the nation’s health care safety net. Across the country, patients in FQHCs are benefiting from state-led value-based payment (VBP) models that move away from traditional fee-for-service payment that reward service volume to models that incentivize high-quality, cost-effective care. This transition has taken on increased urgency in the wake of the COVID-19 pandemic.

A significant number of VBP programs are underway for FQHCs, and many are showing results. This brief, developed by the Center for Health Care Strategies for the California Health Care Foundation, highlights four of these FQHC VBP models — Oregon’s Alternative Payment and Advanced Care Model, Washington State’s Alternative Payment Methodology 4, Illinois’s Medical Home Network, and Minnesota’s FQHC Urban Health Network. The success of these models demonstrates that this transition is possible and has the potential to substantially benefit patients. Because of the flexibility and opportunities for expanded infrastructure under VBP, each of these models has improved outcomes and value to patients.