6 trends federally qualified health centers should monitor

A group of executives work together to solve a puzzle
Federally qualified health centers are transitioning to advanced payment models and value-based care programs, but the process is not easy for all facilities, according to a new survey. (Getty/ALotOfPeople)

Executives at federally qualified health centers are concerned about gaps in their leadership teams and the healthcare industry’s continuing transition to value-based care, according to a new survey.

Sage Growth Partners, a healthcare strategy, technology and marketing firm, surveyed 175 CEOs at federally qualified health centers across the country, representing about 13% of all FQHCs, to identify challenges facing those facilities and how different organizations are dealing with them.

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Through the survey, six trends emerged:

  1. Competition for FQHCs is growing.
  2. Financial growth can still be a struggle.
  3. FQHCs are moving toward value-based care, but implementation of such programs is uneven.
  4. Leadership teams at FQHCs are often filled with major gaps.
  5. Marketing efforts are not effective enough, and execution is often low.
  6. Partnerships offer opportunities for collaboration.

“In the FQHC world, there are always going to be people who say, ‘We’ve always done it this way, we don’t need to change. We’re serving our community in a way nobody else can,’” Katy Caldwell, CEO of Legacy Community Health, an FQHC in Houston, said in an announcement. “But the reality is that other health organizations can and will serve your community if you aren’t running your FQHC like a business.”

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More than half (61%) of the surveyed executives believe that competition will increase over the next year, and 46% cited other FQHCs as a major competitor. A number of these facilities (57%) track patient retention as a way to measure attrition as competition increases.

Leadership challenges were reported by many of the surveyed executives. Sixty-eight percent said finding the right leadership was either moderately or extremely challenging, and just 38% said they believe their current leadership will effectively serve their organizations for the next three to five years. A quarter said that less than half of their current leadership teams would be effective in that window.

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FQHCs are transitioning to advanced payment models and value-based care programs, but the transformation from fee-for-service payment is not easy for all facilities, according to the survey. Seventy-eight percent said it would take between seven and 24 months to transition to a value-based care model if a major payer changed its reimbursement programs.

But there are signs of progress. The vast majority (96%) of those surveyed participated in fee-for-service models in 2014, a number that is projected to drop to 67% by 2018.

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