Programs and Initiatives > Government Affairs and Public Policy > Health Center Payment and Reimbursement
Health Center Payment and Reimbursement
PPS Methodology: Background and MassHealth Payment Methodology
Each state’s Medicaid program pays Federally Qualified Health Centers (FQHCs) according to a Prospective Payment System (PPS) established by Congress because of the unique care delivery model and requirements that federal law places on health centers. States use the PPS methodology to develop a unique bundled rate of payment that supports federally defined FQHC services for each individual FQHC or an alternative that pays no less than PPS (called the Alternative Payment Methodology or APM). This FQHC payment model has been a success of our health care system. It has been uniquely effective at reducing the total cost of care and improving access and outcomes, hence maintaining bipartisan support since its inception.
In Massachusetts, the state Medicaid agency, MassHealth, reimburses FQHCs enrolled with MassHealth as community health centers (CHCs) according to an APM, which is outlined in the CHC rate regulation, 101 CMR 304.00: Rates for Community Health Centers. This is a critical funding stream for these FQHCs, since, on average, Medicaid patients make up 50% of the total FQHC patient population in Massachusetts.
The Government Affairs and Public Policy team works closely with MassHealth on the continued implementation of PPS and other payment models, such as the ACO and Primary Care Sub-Capitation Program, policy development of new payment and care delivery innovations, and CHC-specific guidance on billing, coverage, and other operational changes.
For more information about health center payment and reimbursement, contact Kristen Pieper at: kpieper@massleague.org.
