Community health centers look for ways to capture revenue

The past decade drove quick and necessary expansion of community health centers fueled largely by billions in grant funding provided through the Affordable Care Act.

But the program has also been a constant source of concern for these providers. The Community Health Center Fund, created in 2010, accounts for 70% of federal support. So every year, CHC providers hold their collective breath, waiting to see if Congress will re-authorize the Fund.

“When you’re constantly nervous about funding cycles it’s hard to plan strategies and do innovative things in two-year, three-year period,” said Janet Vadakkumcherry, associate vice president of managed care for Health Center Partners of Southern California, parent company for a network of community health centers serving patients in the San Diego, Riverside and Imperial counties region.

Those concerns have prompted more CHCs to diversify their revenue streams. Larger community health centers like HCP are finding ways to increase their reimbursement from public and commercial insurers.

The pandemic has not been easy on CHCs, which reported a 43% drop in patient visits in the past year according to a research brief from the Kaiser Family Foundation. More than 1,900 health center sites temporary closed their doors by May 2020, the report found.

Amanda Simons, interim executive lead for Integrated Health Partners, HCP’s clinically integrated FQHC health network, said 99% of IHP’s revenue comes from MediCal, California’s Medicaid program.

In order to capture more of this population, HCP will begin to target older adults with programs like home healthcare services. The goal is to make community health centers draw a broader patient base.

“We just have to get aggressive,” Simons said. “I think FQHCs have historically not told their story well enough.”

Simons said both IHP and HCP have large learning networks to help providers with business operational issues like coding, clinical documentation, and revenue cycle management since many smaller community health centers lack these resources and expertise.

That need has prompted other large CHC operators to serve as consultants to peers.

“Over the years we have gotten a lot of calls from people asking us to help them with their billing, their revenue cycle, their marketing, or to tell them how we grew,” said Katy Caldwell, CEO of Houston-based community health center, Legacy Community Health. “So we wanted to see if we could really bring some good services and value-added services to other federal qualified health centers around the country.”

Legacy recently joined healthcare consulting firm Canton & Company to form Monarch Health Solutions, to market business solutions exclusively to community health centers seeking to scale up their financial operations.

Monarch offers services like business planning, revenue cycle management capabilities, and strategies around acquiring new patients, payer contracting, and population health management.

Caldwell said Monarch came from Legacy’s own evolution from an HIV clinic in the 1980s to a full-service Federally Qualified Health Center today, providing care for more than 189,000 patients across 41 sites annually.

“One of the things that we went through going from a totally grant-driven organization to one that had to bill Medicare and Medicaid and private insurance was learning how to bill,” Caldwell said. “We had a hard time finding people who were in our position or consultants who understood grant funding and billing in an FQHC world.”

According to KFF, 61% of CHC patients earn incomes that are below 100% of the federal poverty line, and 69% are either uninsured or on Medicaid.

Canton & Company CEO Don McDaniel said he saw Legacy’s experience in growing their operations as a model other community health centers could adopt. He felt having Legacy as a partner added a layer of credibility and trust to the quality of the services Monarch offers. But McDaniel felt another vital aspect of the joint venture was having the perspective of a community health center operator on the kinds of administrative and financial supports those providers might need most during each phase of their growth.

“We think we have quite an advantage in that we have a sandbox and a strong partner who can really help us think about the right way to go,” McDaniel said.