PRIMARY CARE FUND AND FEDERALLY QUALIFIED HEALTH CENTER (FQHC) REIMBURSEMENT ACT
I. Purpose The bill expands funding opportunities for the Primary Care Fund by allowing the Department of Health Care Policy and Financing to accept private and public gifts. It ensures that designated FQHCs or qualified providers receive 115% of the total amount of gifts received while maintaining compliance with federal Medicaid regulations. It also establishes a framework for FQHC subsidiaries to receive fee-for-service reimbursements outside of standard cost reporting.
II. Legislative Findings
FQHCs serve 30% of Medicaid patients but receive less than 2% of total Medicaid provider reimbursements.
The Primary Care Fund was created to support providers serving uninsured and medically indigent patients.
CMS provides a one-to-one federal match for each dollar allocated to the fund but prohibits direct provider donations.
Alternative funding sources through private or public gifts can increase resources for FQHCs while maintaining compliance with federal rules.
III. Primary Care Fund Amendments
Authorizes the state department to seek and accept gifts for the Primary Care Fund.
Requires the State Treasurer to credit all received gifts to the fund.
Allocates 115% of the total gift amount to the designated FQHC or qualified provider upon federal approval.
Prohibits donations from FQHCs or qualified providers that have a direct or indirect relationship to Medicaid payments if the allocation amount is positively correlated with the donation.
IV. FQHC Subsidiary Reimbursement
Allows FQHCs to create separate subsidiary companies to provide fee-for-service services outside of their standard cost report.
Subsidiaries qualify for fee-for-service reimbursement if:
The services have historically been reimbursed on a fee-for-service basis.
The state department determines that reimbursement would be budget-neutral.
Ensures that subsidiary reimbursements can be passed through to the FQHC parent organization.
Excludes subsidiary reimbursements from the FQHC’s cost report to maintain financial integrity.
V. Implementation and Compliance
Requires federal authorization before implementing new funding and reimbursement policies.
Maintains compliance with Medicaid and CMS regulations while increasing funding options for primary care services.
Enhances financial sustainability for FQHCs without compromising federal Medicaid funding rules.
VI. Safety Clause Declares the act necessary for the immediate preservation of public health and safety, ensuring continued support for primary care providers and FQHCs.
Summary
The bill authorizes the department of health care policy and
financing (state department) to seek and accept gifts from private or public sources for the primary care fund. Upon receiving federal authorization, if the state department receives gifts designated for a federally qualified health center (FQHC) or a qualified provider, the state department is required to allocate 115% of the total amount of gifts received to the designated FQHC or qualified provider. The bill prohibits the state department from allocating money to a qualified provider if the donor is an FQHC or a qualified provider that has a direct or indirect relationship to medicaid payments and the allocation amount is positively correlated to the donation.
The bill authorizes an FQHC to establish a separate subsidiary
company for the purpose of providing fee-for-service services outside of the FQHC's standard cost report if the subsidiary is providing fee-for-service services that have historically been provided and reimbursed on a fee-for-service basis, or if the state department determines that the subsidiary's reimbursements would be budget neutral. Upon receiving any necessary federal authorization, the state department is required to reimburse a subsidiary of an FQHC on a fee-for-service basis for services that are eligible for fee-for-service reimbursement. A subsidiary that receives reimbursement is authorized to pass through money received from the reimbursement directly to the FQHC operating as the subsidiary's parent corporation. Services reimbursed to an FQHC's subsidiary are excluded from the FQHC's cost report.
