Federally Qualified Health Center (FQHC) Medicaid Reimbursement


General FQHC Information

Federally Qualified Health Centers (FQHC) are health centers that receive Public Health Service (PHS) Act, Section 330 funds, and provide primary care services in underserved, urban and rural communities. FQHC is a federal designation from the U.S. Dept. of Health & Human Services, Health Resources & Services Administration (HRSA), Bureau of Primary Health Care (BPHC), and the Center for Medicare and Medicaid Services (CMS) that is assigned to private non-profit or public health care organizations that serve predominantly uninsured or medically underserved populations.

The primary purpose of Federally Qualified Health Centers is to expand access to primary health care for uninsured and under served populations, who experience financial, geographic or cultural barriers to care and who live in or near federally designated health professional shortage areas (HPSAs) and medically under-served areas (MUAs).

There are five essential elements which differentiate FQHCs from other health care providers.

FQHCs must:

  • Be located in a federally designated medically underserved area (MUA) or serve a federally designated medically underserved population (MUP);
  • Provide comprehensive primary care services, referrals, and other services needed to facilitate access to care, such as case management, translation, and transportation;
  • Provide services to all in the service area regardless of ability to pay and offer a sliding fee schedule that adjusts according to income.
  • Have nonprofit, public, or tax exempt status;
  • Have a governing board, the majority of whose members are patients of the health center.

FQHC clinical services requirements include:

  • Patients must have access to all required services, access to specialty and hospital services, and after-hours coverage.
  • The location must be physically located on or near a major road or public transportation stop to ensure accessibility.
  • Hours of operation must facilitate access to care by having early morning, evening or weekend hours.
  • Ensure the appropriate mix of services for the target population to minimize duplication of services and maximize financial resources.
  • Should have written agreements with other service providers for those required services not directly provided by health center.
  • FQHC must establish and update health care goals and objectives to address the highest priority of health care needs of patients.
  • Have a Medical Director that supervises all clinical activities and medical doctors that are licensed and residency trained. Other clinicians must have appropriate licensure.