Why Work Together? Solve the Puzzle of Value-Based Payment Models

There are many uncertainties as the shift toward value-based payment (VBP) models begins to accelerate within the federally qualified health center (FQHC) industry. To help sort through some of the big-picture questions, we sat down with two of the industry’s most experienced professionals: Michele Hannagan and Mike Hofmeister of NextGen Healthcare.

• As a clinical executive leader, Michele has worked side by side with clinicians, nurses, and patients at Jordan Health, a legacy FQHC in New York. She joined NextGen Healthcare in 2021 to bring her real-world experience with the patients, clinicians, and staff within community health to the world of electronic health record (EHR) systems.
• As the leader of the primary care market solutions at NextGen Healthcare, Mike has a unique perspective on FQHC challenges. He works with both business and clinical leaders daily to explore new ways technology can help them improve efficiencies while expanding patient access and improving care quality.

Michele and Mike have both actively led NextGen Healthcare’s ongoing initiatives to support FQHCs in their transition to VBP models. Most recently, they have participated in multiple industry roundtables and webinars on the topic and the resulting challenges FQHCs face. Below are links to two webinars that illustrate their expertise and efforts on this subject.

• FQHCs and Value-Based Care: The Perfect Storm: Watch here.
• Drivers of Change: How Peer-to-Peer Collaboration Helps Us Achieve Comprehensive, Whole-Person Care: Watch here.

Let’s dig deeper

Q: According to a recent Porter Research industry study, 85% of FQHCs expect value-based payments to grow over the next 12 to 18 months. What do you think is driving this growth?

Michele: The Centers for Medicare and Medicaid Services (CMS) has been driving toward value-based payments for the past decade. Until recently, FQHCs have largely been left alone because of their mission-driven models based on grants and bonus payments for their ability to provide care to our nation’s most vulnerable and underserved citizens. However, our customers are telling us that this is changing, and the pressure to take on more financial risk is mounting. That pressure is mainly coming from the growth in commercial payers who are managing state Medicaid programs following suit with the plans they are implementing for other non-FQHC healthcare providers.

Everyone is looking for ways to reduce costs as the cost of healthcare continues to skyrocket in a post-pandemic world. Also, results from the earlier years of value-based care models that traditional healthcare providers deployed are starting to reveal some improvements around quality and cost. Still, FQHCs serve a different population with a much broader set of barriers and needs than traditional models.

Mike: The fundamental premise behind value-based care is better outcomes for patients and lower costs for the healthcare system. Within FQHCs, this holds true but for a greatly compromised population where social determinants of health (SDOH) play a much more significant role.

Patients who are served by community health centers typically live with health conditions that require the most complex care services. For payers, patients, and FQHC providers to succeed, we will all need to work together to find new ways to harness the data that really matters to these mission-driven organizations and their ability to truly improve outcomes and control costs.

Q: How do you see VBP models changing, and what impact do you think that will have on FQHCs?

Michele: We are definitely seeing changes to value-based payment models as payers push for FQHCs to take on more of the financial responsibilities associated with VBP. Other healthcare providers, such as hospitals and ambulatory care providers, are engaging in these models at a much faster pace, likely due to the reimbursement consequences, such as readmission penalties and, in some cases, better patient outcomes.

But FQHCs are on a different mission than hospitals. They don’t just treat the sick. They are taking on the health of a population that often doesn’t have the financial means or ability to care for themselves. To improve the health of these communities, FQHCs have to do things and provide services that traditionally aren’t captured on a medical claim form. FQHCs don’t fit neatly into traditional VBP models with standard quality measures. To succeed, FQHCs are going to need to work together at a higher level than they are today. By that, I mean collaborating to share what we’re calling mission-driven data on a national level.

Q: Do you think it is possible for FQHCs to maintain their independence from hospitals during this transition to VBP?

Michele: We know FQHCs want to maintain their independence, which is key to achieving their mission. In fact, 83% of the respondents in the Porter Research study appear to be fiercely committed to maintaining their independence, stating that maintaining their independence was very important.

Another 17% said independence was somewhat important—that’s 100%. To do this, they must find new ways to work more closely together with others. Today, that infrastructure to exchange data, best practices, and insights is somewhat limited to the state or regional levels. Collaborating on a national level with access to a much wider range of data will be key to maintaining their independence.

Q: How do you believe FQHCs can work more closely together at the national level?

Mike: Many FQHCs are currently working with like-minded organizations, such as Primary Care Associations (PCAs) and Health Center Controlled Networks (HCCNs), but with this new wave of VBP models that require FQHCs to take on more financial accountability, these relationships are not enough. This was apparent in the Porter Research study that shows 77% of FQHC leaders are not confident in their current VBP strategies, and only 7% are fully satisfied with what they are doing today. At NextGen Healthcare, we saw this trend coming in early 2021 and have been working with FQHCs from across the country to build a better way via the NextGen Community Health Collaborative.

Q: Tell us more about this Collaborative? Is it just for NextGen Healthcare customers?

Mike: The Community Health Collaborative is not just for customers. It is 100% vendor-agnostic. The purpose of the Collaborative is to help FQHCs have greater access to the data that matters most to them so they can benchmark their performance against their peers and collectively, as a national community, better understand clinical and operational best practices that work for community health.

It also makes it easier for leaders to connect and share insights into new programs and successes. We are already receiving a tremendous amount of positive input as more and more FQHCs participate in the initiative. For those who are interested in joining, you can contact us here.