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The next 12 months will be a critical time for many Federally Qualified Health Centers (FQHCs) as the healthcare industry’s shift toward value-based care accelerates. In addition to changing payment models, FQHCs struggle with extreme clinical and administrative workforce shortages. State Medicaid programs have become more complex and difficult to manage while the needs of the communities they serve continue to expand. One might say a perfect storm is brewing.

Porter Research recently conducted an independent study to help FQHC leaders better understand what their peers are thinking and doing when it comes to value-based payment (VBP) strategies. More than 50 clinical, financial, and operational leaders from mid- to large-size FQHCs across the country responded to the study commissioned by NextGen Healthcare—the FQHC industry’s most widely used electronic health record (EHR) system.

The research reveals that VBP strategies are still in the early stages among FQHCs, but the majority of respondents believe that this is about to change… and change quickly over the next 1–2 years. As organizations prepare to take on even more financial risks that come with a new wave of VBP models, FQHCs must seek out innovative ways to share insights and collaborate with each other to survive. 

Key findings from Porter Research

It’s early, but VBP is growing.

  • Only 30% of FQHCs currently have VBP strategies in place
  • Among those, 63% said that less than 10% of their revenue comes from value-based and risk-bearing arrangements today
  • But, another 50% expect to implement VBP programs in the next 12–24 months

So how is it going so far? In a nutshell—not so great. Only 7% of FQHC leaders report being fully satisfied with their current strategies. Plus, 77% say they lack confidence in their organization’s ability to implement their VBP strategies.

The good news: Change is coming. In fact, 64% expect to modify their VBP strategies within the next 12–18 months. When asked how their strategies will change, most respondents talked about collaborating more closely with like-minded organizations, such as other FQHCs, Primary Care Associations (PCAs), and Health Center Controlled Networks (HCCNs).

Change is not without challenges

When asked about their biggest barriers to implementing and optimizing VBP models, the top three challenges mentioned were:

  • The inability to share data across systems and providers (interoperability)
  • The effort required to keep up with growing state requirements
  • Staffing shortages to provide clinical services and administrative support needed for compliance and funding

An eye toward the future

Working together with both clients and non-clients, NextGen Healthcare is committed to helping FQHCs maintain their independence and advance their missions. The survey results were clear: 83% of FQHC leaders are fiercely committed to maintaining their independence from hospitals. To do so, FQHCs must have access to EHR systems that make it easy to share the data and insights necessary to successfully navigate VBP models.

NextGen Healthcare:

  • Delivers highly interoperable software systems that leverage the CMS-standard interoperability protocols (FHIR-based APIs) to help FQHCs easily share data with other care partners and FQHCs
  • Leads industry-wide collaboration initiatives such as listening forums with FQHC leaders and the announcement of the NextGen Community Health Collaborative last fall
  • Enables FQHCs to leverage the data, insights, and best practices learned from each other to develop whole-person care plans that drive better outcomes and reduce the total cost of care

To hear more about the study results and learn about the industry-wide initiatives underway at NextGen Healthcare, you can download the research report, check out the research infographic, and/or listen to the research webinar hosted by Porter Research and NextGen Healthcare entitled “The Perfect Storm: Why FQHC Leaders Must Choose Wisely.” 

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Mike Hofmeister headshot

Mike Hofmeister

VP, Primary Care Market Solutions