Value-based payment (VBP) — which ties health care reimbursement to quality and cost outcomes — has gained traction across the health care sector. Primary care providers participating in VBP arrangements have often performed well, likely due to their focus on prevention and cost-efficient care. However, community health centers (CHCs), which provide primary care to more than 31 million people across the country, have faced challenges entering into VBP arrangements.
One reason is financial. Many CHCs operate on slim margins that are only getting slimmer with rising costs, making it difficult to fund the necessary infrastructure (e.g., legal, financial, and data expertise) for VBP implementation. VBP agreements often require CHCs to juggle different data obligations and quality goals across contracts, which adds significant administrative overhead.
Despite these barriers, there is a newfound urgency, hastened by financial pressures and the shift to VBP among health care payers and providers, for CHCs to transition to VBP. For CHCs to remain sustainable and mission-aligned, they will need to embrace these transformations while safeguarding their core commitment to high-quality, community-focused care.
Pathways to Partnership
As CHCs transition into VBP, they typically need new technological, financial, and data capacities over and above what they need to run health center locations. For example, providers thinking about joining VBP programs might need to retain lawyers with specific expertise in evaluating contracts and purchase new software to predict patients who will likely end up in the hospital without extra care and support.
CHCs can develop this infrastructure on their own, but it requires financial investment, expertise, and time, which may be limited. CHCs also can partner with other groups, including:
- Primary care associations (PCAs) are state or regional nonprofit organizations that provide training and technical assistance to CHCs. They can help CHCs engage in VBP by improving programmatic, clinical, and financial performance. For example, the Michigan Primary Care Association partnered with its member CHCs to establish a clinically integrated network, the Michigan Community Health Network (MCHN). MCHN supports CHCs in nine Medicaid managed care contracts and two Medicare accountable care models, covering more than 70,000 members. MCHN manages contracts that hold CHCs accountable for the total cost of a patient’s care, meaning that CHCs can earn incentives for keeping patients healthy and avoiding unnecessary expenses. It also helps CHCs follow shared clinical protocols to deliver more consistent, high-quality care and reduce variation in patient experiences across locations. The network also offers training on workflows and evidence-based practices and runs a peer-led quality committee to drive performance improvements.
- Health center–controlled networks (HCCNs) are federally funded to help CHCs use health information technology to improve operational and clinical practices, resulting in better health outcomes for the communities they serve; some PCAs are also HCCNs. They can help CHCs develop the technology and data analysis capabilities they need for VBP. One example is OCHIN, which operates across 13 states and supports 113 health centers nationally. OCHIN has helped its member CHCs move into value-based care using webinars, learning collaboratives, a VBP innovators group, and a specialized “Volume to Value” podcast.
- CHC provider networks are groups of CHCs that come together to negotiate VBP contracts with health care payers and share infrastructure and best practices. Examples of such networks include Forward Leading IPA and Medical Home Network. In California, 10 CHCs came together to form Integrated Health Partners of Southern California (IHP SoCal), which now manages more than 350,000 lives across five payer contracts, two of which involve professional risk. In the professional risk arrangements, IHP SoCal has responsibility for managing costs and paying claims for all professional services including primary care, specialty care, and professional components of hospital visits. It also supports managed care negotiation and contracting, IT and data analytics, practice transformation, and utilization review and management services.
- VBP-enablement companies are typically private companies like Aledade, Yuvo, Evolent, and Signify Health that help CHCs enter into and perform under VBP by offering tools, software, and expertise. In Virginia, 15 CHCs collaborated with Aledade to establish the state’s first CHC-exclusive accountable care organization (ACO) under the Medicare Shared Savings Program. Aledade provided these CHCs with technology, analytics, and other services. Across the country, Aledade provides support to eight ACOs exclusively made up of CHCs and recently launched a CHC Center of Excellence to help support peer learning.
Looking Ahead
As health care moves toward value-based models, community health centers must adapt to remain sustainable while staying true to their mission of serving all patients, regardless of ability to pay. Strategic partnerships can equip CHCs with the tools they need to succeed in this evolving landscape.
