FQHC Alternative Payment Methodologies
To allow for increased flexibility, the law allows states to design and implement an alternative payment methodology (FQHC APM) so long as:
- The total FQHC APM reimbursement is not less than what the FQHC would have received with the FQHC PPS methodology;
- Each participating FQHC individually agrees to the FQHC APM; and
- The FQHC APM is documented in the state’s approved Medicaid State Plan.
As of 2017, over 20 states have chosen to use a FQHC APM to reimburse health centers for primary care and preventative services provided to Medicaid patients. An increasing number of health centers, in partnership with their state-level colleagues, are utilizing the flexibility within federal Medicaid law to develop FQHC APMs that allow for a more transformative use of the medical home.
