Transforming Community Health Centers into Patient-Centered Medical Homes: The Role of Payment Reform

This report examines how changes in the way federally qualified health centers (FQHCs) are financed could support the transformation of these critical safety-net providers into high performing patient-centered medical homes. Through surveys and interviews, the authors explore the current landscape of health center involvement in medical home initiatives, adoption of medical home standards, and receipt of payment incentives. Based on their findings, the authors make preliminary recommendations to encourage health centers to serve as patient- and community-centered medical homes. These include: establishing recommended standards for patient- and community-centered medical homes that apply to FQHCs; structuring payment incentives to promote medical homes; including FQHCs in state Medicaid medical or health home projects; adapting payment approaches, including adding monthly case management fees; and encouraging the Health Resources and Services Administration to use quality-of-care measures in making funding decisions.

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