FQHC's, Medicaid, Community Link Consulting, Community Health, Medical Claims, Value CHC's, WA State Medicaid
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Navigating Potential Medicaid Cuts: Proactive ...
Community Link Consulting, Community Health, FQHC's, Value CHC's, Federal Grants
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It’s been a whirlwind week with OMB announcements, but we’re here to help you navigate the latest changes. From grant funding and compliance to financial strategy and advocacy, CLC has key recommendations to keep your organization on track.

medicaid cuts

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Navigating Potential Medicaid Cuts: Proactive Strategies for FQHCs

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CLC aims to update you on possible Medicaid cuts and provide practical advice for FQHCs to effectively address these changes and maintain service continuity. As crucial providers of wide-ranging health services to underserved groups, FQHCs must plan carefully to manage the potential impacts of Medicaid cuts and sustain essential operations. 

Medicaid Cuts in the News 

Proposed Changes to Reduce Medicaid Spending 

  • Per-Capita Caps: Introducing a per-capita cap would limit the amount of federal spending per Medicaid enrollee, potentially reducing overall spending but shifting cost burdens to states during high-need periods. 

  • Federal Matching Adjustments for ACA Expansion: The proposal to reduce or eliminate enhanced federal matching funds for states with Medicaid expansion could significantly impact state budgets. Currently, states under expansion receive a 90% federal matching rate. Reducing this rate would force states to find alternative funding, cut eligibility, or potentially roll back Medicaid expansion. 

  • Lowering the Federal Matching Floor: Reducing the minimum federal contribution below the current 50% for traditional Medicaid populations. 

  • Mandatory Work Requirements: Implementing nationwide work requirements for Medicaid recipients might reduce enrollment. 

Impacts of Medicaid Cuts on FQHCs 

1. Change in Payer Mix 

  • As Medicaid eligibility tightens, more individuals may lose coverage, potentially increasing the number of uninsured patients turning to FQHCs for care. 

2. Reduced Funding Streams 

  • A change in payer mix from Medicaid to uninsured will reduce the revenue per visit. 

  • Some states may react by reducing benefits or eliminating Medicaid expansion. 

  • Medicaid rate setting processes may be looked at to reduce Medicaid rates for FQHCs. 

3. Strain on Resources and Support Staff 

  • Supportive funds that FQHCs rely on for staff who support enrollment may be cut, forcing FQHCs to find a new way to pay for those staff or having to eliminate those positions. 

Strategic Recommendations for FQHCs 

1. Diversify Funding Sources 

  • Explore Other Revenue Opportunities: Explore other payer types, services to offer, and expand the private insurance patients you take. 

  • Identify Value Based Payments: Explore what value-based payment enhancements you can be receiving for the payers you are working with. 

  • Seek Alternative Grants: Actively seek other grant opportunities from both government and private sources to supplement potential shortfalls. 

  • Pursue Fundraising and Donations: Enhance efforts to engage the community and alumni for donations and fundraising events. 

2. Enhance Community Partnerships 

  • Collaborate with Local Healthcare Providers: Develop partnerships with other local healthcare providers to share resources and refer patients when necessary. 

  • Engage Community Organizations: Work closely with local community organizations to support healthcare education and preventive care programs. 

3. Project and Know Your Numbers 

  • Project the Effects of Payer Mix Shift: Project out the scenarios to understand the financial implications of a reduction in your Medicaid population and create a contingency plan 

  • Complete a Break-Even Analysis: Put the scenario projections into a break-even analysis. 

4. Advocacy and Awareness 

  • Public Awareness Campaigns: Initiate campaigns to educate the public and policymakers about the value FQHCs provide to the community and the potential impact of funding cuts. 

5. Prepare for an Increase in Uninsured Patients 

  • Sliding Fee Scales: Ensure that sliding fee scale policies are up-to-date and effectively communicated to patients. 

  • Community Health Workers: Utilize community health workers to manage care and connect uninsured patients to available resources and preventive care. 

6. Stay Informed and Remain Calm 

  • Stay Informed: Keep up to date with the news of potential Medicaid cuts and understand specifically the effects in your state 

  • Remain Calm but be Prepared: It is important to remain calm with all these changes and not overact, but it is important to be up to date and prepare for any changes. 

The potential cuts to Medicaid pose a significant challenge for FQHCs, but by adopting a proactive approach, centers can mitigate the impact and continue their mission to provide essential health services to vulnerable populations. Strategic and financial planning, community engagement, and advocacy are key to navigating these uncertain times. 

As always, Community Link Consulting is committed to supporting you through these challenges. Please do not hesitate to contact us for guidance on these recommendations or to share updates and insights from your experience. We are here to assist and inform you every step of the way. 

Phone: 509-226-1393 
E-mail: info@communitylinkconsulting.com 

Sincerely, 

Karen Creveling-Hughes, CEO