National Association of Community Health Centers

Natioal Associatio of Commuity Health Ceters Parterships betwee Federally Qualified Health Ceters ad Local Health Departmets for Egagig i the Developmet of a Commuity-Based System of Care Prepared by Feldesma Tucker Leifer Fidell LLP for the Natioal Associatio of Commuity Health Ceters October 2010

Natioal Associatio of Commuity Health Ceters Ackowledgmets / Disclaimer Parterships betwee Federally Qualified Health Ceters ad Local Health Departmets for Egagig i the Developmet of a Commuity-Based System of Care familiarizes the reader with federally qualified health ceters ad local health departmets ad explores various collaborative models that optimize resources ad promote improved health care access ad quality improvemet. While this guide does ot describe the full scope of partership optios, it provides guidace to support the reader s efforts i evaluatig, selectig, ad implemetig a partership that is appropriate for a particular commuity. This publicatio was prepared for the Natioal Associatio of Commuity Health Ceters (NACHC) by attoreys with the law firm of Feldesma Tucker Leifer Fidell LLP (FTLF). It is desiged to provide accurate ad authoritative iformatio i regard to the subject matter covered. While icorporatig certai priciples of federal law, this guide is published with the uderstadig that it does ot costitute, ad is ot a substitute for, legal, fiacial or other professioal advice. Further, this guide does ot purport to provide advice based o specific state law. Federally qualified health ceters ad local health departmets should cosult kowledgeable legal cousel ad fiacial experts to structure ad implemet a partership that is legally, fiacially, ad operatioally appropriate give the particular federally qualified health ceter s ad local health departmet s respective goals, objectives, expectatios, ad resources. Natioal Associatio of Commuity Health Ceters 2

Parterships betwee Federally Qualified Health Ceters ad Local Health Departmets Natioal Associatio of Commuity Health Ceters (NACHC) Established i 1971, NACHC serves as the atioal voice for America s Health Ceters ad as a advocate for heath care access for the medically uderserved ad uisured. NACHC s missio is to promote the provisio of high quality, comprehesive ad affordable health care that is coordiated, culturally ad liguistically competet, ad commuity directed for all medically uderserved populatios. Natioal Associatio of Couty ad City Health Officials (NACCHO) NACCHO is the atioal oprofit orgaizatio represetig the approximately 2,860 local health departmets (LHDs) atiowide, icludig members i all public health regios. NACCHO serves every LHD i the atio, without regard to the uit of govermet with which a departmet is associated. These iclude LHDs associated with couties; cities; combied couty-city etities; tows; multi-tow, multi-couty, or other regioal etities withi a state; tribes; ad states. NACCHO s visio is health, equity, ad well-beig for all people i their commuities through public health policies ad services. NACCHO s missio is to be a leader, catalyst, ad voice for LHDs i order to esure the coditios that promote health ad equity, combat disease, ad improve the quality ad legth of lives. For more iformatio cotact: Marcie Zakheim, Esq. or Carrie S. Bill, Esq. Feldesma Tucker Leifer Fidell LLP 1129 20th Street, N.W. Fourth Floor Washigto, DC 20036 Telephoe (202) 466-8960 www.ftlf.com Email: mzakheim@ftlf.com or cbill@ftlf.com Kathy McNamara, RN, MA Natioal Associatio of Commuity Health Ceters 7200 Wiscosi Aveue Suite 210 Bethesda, MD 20814 Telephoe (301) 347-0400 www.achc.com Email: kmcamara@achc.com Jeifer Joseph, PhD, MSEd Natioal Associatio of Couty ad City Health Officials 1100 17th Street, N.W. Seveth Floor Washigto, DC 20036 Telephoe (202) 507-4237 www.accho.org E-mail: jjoseph@accho.org xxxxxxx NACHC gratefully ackowledges Cidy Phillips, Laure Shirey, Jeifer Joseph, Marisela Rodela, Reba Novich, ad Robert Pestrok of the Natioal Associatio of Couty ad City Health Officials (NACCHO) for their ivaluable collaboratio o the developmet ad writig of this guide. Additioally, NACHC thaks members of NACCHO s HIV/STI Prevetio ad Access ad Itegrated Services Workgroups for graciously sharig their kowledge of LHDs ad providig editorial support. Natioal Associatio of Commuity Health Ceters 3

Parterships betwee Federally Qualified Health Ceters ad Local Health Departmets Table of Cotets Itroductio................................................................. 5 1 Federally Qualified Health Ceter-Local Health Departmet Parterships: A Strategic Alliace......... 7 Patiet Protectio ad Affordable Care Act The Patiet-Cetered Medical Home Model of Care Meaigful Use of Health Iformatio Techology Partership Beefits 2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets...... 13 Federally Qualified Health Ceter Fudametals Defiig a Federally Qualified Health Ceter Key Federally Qualified Health Ceter Requiremets Cost-Based Reimbursemet, Federal Tort Claims Act, Sectio 340B Drug Pricig, ad Ati-Kickback Safe Harbor Protectio Federally Qualified Health Ceter Scope of Project Cosideratios Local Health Departmet Fudametals Fuctio Goverace Fudig Relatioship to State Health Departmet Jurisdictios Workforce Services 3 The Plaig Process: Layig the Foudatio for a Successful Partership..................... 37 Essetials of a Successful Partership Establishig a Partership Questios to Guide the Plaig Process Cofidetiality Agreemet Health Iformatio Exchage ad Patiet Privacy Cosideratios 4 Federally Qualified Health Ceter-Local Health Departmet Partership Models................. 41 Key Cosideratios ad Agreemet Terms Referral Arragemets Co-Locatio Arragemets Purchase of Services Arragemets 5 Additioal Legal Cosideratios................................................ 53 6 Coclusio ad Next Steps................................................... 54 Appedix A................................................................ 55 Natioal Associatio of Commuity Health Ceters 4

Parterships betwee Federally Qualified Health Ceters ad Local Health Departmets Itroductio Federally qualified health ceters (hereiafter FQHCs or Commuity Health Ceters ( CHCs )) ad local heath departmets (hereiafter LHDs ) share a commo missio to improve commuity health, particularly amog vulerable ad uderserved populatios. FQHCs ad LHDs curretly work collaboratively o behalf of their residets i may commuities across the coutry. Today, the reasos for partership betwee FQHCs ad LHDs are particularly compellig. The passage of the Patiet Protectio ad Affordable Care Act (the health reform law ) sigals a overhaul of the health care system, with a importat emphasis o primary care, prevetio, ad collaboratio amog a commuity s health care providers. A core compoet of the health reform law is the expasio of the patiet cetered medical home model of care delivery, which calls for patiet care to be coordiated ad itegrated across the health care system. Both the Patiet Protectio ad Affordable Care Act ad the expasio of the patiet cetered medical home model preset fresh opportuities for health ad commuity leaders to work together to desig ad implemet local health delivery ad care systems that: Address the health issues of uderserved ad vulerable commuities; Improve ad documet value; Geerate positive patiet ad commuity experieces of care ad egagemet i health; ad Improve the health of target populatios with a emphasis o promotig health equity ad elimiatig health disparities. FQHCs ad LHDs differ i some substative ways. FQHCs are charged with the delivery of a full cotiuum of primary ad prevetive care services, ad eablig services. LHDs are charged with populatio health, which may or may ot iclude health care delivery. Likewise, as federally-fuded etities, FQHCs structure ad regulatios are relatively uiform compared to LHDs, whose goverace ad activities vary widely from state to state ad from commuity to commuity. However, the two etities are well positioed to be strog parters ad there is a log history of comig together to improve both idividual ad populatio health. Parterships betwee Federally Qualified Health Ceters ad Local Health Departmets for Egagig i the Developmet of a Commuity-Based System of Care provides a overview of several partership opportuities available to FQHCs ad LHDs seekig to improve health outcomes i their commuity, while promotig cost-effective care. Through the les of partership, LHD readers will beefit from iformatio preseted about the key features of FQHCs ad the various federal requiremets applicable to the program. Likewise, FQHC readers will gai isight ito LHDs. Natioal Associatio of Commuity Health Ceters 5

Parterships betwee Federally Qualified Health Ceters ad Local Health Departmets Specifically, this guide addresses: The Patiet Protectio ad Affordable Care Act, the patiet cetered medical home model of care, ad the meaigful use of health iformatio techology as drivers i FQHC- LHD parterships; Beefits associated with FQHC-LHD parterships; Key features of FQHCs ad LHDs ad their relevace to FQHC-LHD parterships; Health iformatio exchage ad patiet privacy cosideratios withi the cotext of FQHC-LHD parterships; ad Various partership models, icludig key terms for writte agreemets to implemet a affiliatio approach that is compliat with applicable FQHC federal rules ad requiremets. Natioal Associatio of Commuity Health Ceters 6

Parterships betwee Federally Qualified Health Ceters ad Local Health Departmets 1 Federally Qualified Health Ceter-Local Health Departmet Parterships: A Strategic Alliace Parterships are ecessary to maximize resources, to reduce duplicatio of effort, ad to improve quality, efficiecy, ad accessibility of health care services. The chagig face of America s uderserved populatio, the restricted resources uder which FQHCs ad LHDs operate, ad the desire ad eed for more fully-fuctioig ad better prepared public health ad primary care systems all demad a health care system based i local parterships. Curretly, FQHCs ad LHDs successfully parter to address a variety of public health ad primary care priorities, icludig but ot limited to the followig: HIV prevetio ad testig; STD testig, care ad treatmet; Detal health; Behavioral health; Chroic disease prevetio; Materal ad child health; ad Emergecy preparedess. NACHC ad NACCHO: A Joit Missio to Promote Collaboratio betwee FQHCs ad LHDs O Jue 1, 2010, the Natioal Associatio of Commuity Health Ceters (NACHC) ad the Natioal Associatio of Couty ad City Health Officials (NAC- CHO) collectively wrote a letter to their respective members, statig NACCHO ad NACHC recogize that a ew collaboratio betwee our two orgaizatios ca help our respective members address the challeges of health system reform. The letter further oted that excellet models of local collaboratio curretly exist ad that together the orgaizatios pla to discover more models, to lear from them, ad to ecourage the developmet of such costructive relatioships atiowide. A. Patiet Protectio ad Affordable Care Act The passage of the Patiet Protectio ad Affordable Care Act ( the health reform law ) i 2010 provides for a sigificat fiacial ivestmet i programs based i public health, primary care, ad commuity collaboratio. This ivestmet reflects a atioal shift towards emphasizig welless ad prevetio, cliical itegratio, ad collaborative commuity based care. Ideed, it is well settled that reform will ot be successful without such collaboratio. Collaboratio betwee FQHCs ad LHDs is therefore ot oly desirable, it is ecessary give the priorities set forth i health reform. Health Reform ad FQHC-LHD Collaboratio Through collaboratio, FQHCs ad LHDs may positio themselves to participate i fudig opportuities. There are several relevat fudig opportuities described i the health reform law, icludig the followig: Commuity health teams (Pub. L. 111-148 3502): The health reform law states that health teams composed of commuity-based, iterdiscipliary medical professioals will be established to support primary care medical homes Natioal Associatio of Commuity Health Ceters 7

1 Federally Qualified Health Ceter-Local Health Departmet Parterships: A Strategic Alliace that are withi hospital areas served by those etities. This provisio allows LHDs to receive fuds to establish a commuity health team ad collaborate with local primary care providers, icludig FQHCs. Commuity-based prevetio ad welless programs (Pub. L. 111-148 4202): The health reform law establishes that there will be grats for LHDs to carry out 5-year pilot programs to provide public health commuity itervetios. Amog other requiremets, LHDs are required to demostrate the capacity to establish relatioships with commuity-based cliical parters, such as FQHCs. Primary care extesio programs (Pub. L. 111-148 5404): The health reform law authorizes grats to states to establish primary care extesio programs. These programs rely o the collaboratio of LHDs ad FQHCs to idetify commuity health priorities ad participate i commuity-based efforts to address these primary care priorities. I additio to these opportuities preseted i the health reform law, both the Ceters for Disease Cotrol ad Prevetio (CDC) ad the Health Resources ad Services Admiistratio (HRSA) have made public health ad primary care collaboratio a priority, resultig i the availability of fudig to support collaborative efforts. From Fragmetatio to a High Performace Health System Accordig to a Commowealth Fud Commissio o a High Performace Health System report, fragmetatio i the health care delivery system fosters frustratig ad dagerous patiet experieces, especially for patiets obtaiig care from multiple providers i a variety of settigs. Fragmetatio also leads to waste ad duplicatio, hiderig providers ability to deliver high-quality, efficiet care. 1 The Commissio idetified the followig six attributes of a ideal health care delivery system: 1. Patiets cliically relevat iformatio is available to all providers at the poit of care ad to patiets through electroic health record systems. 2. Patiet care is coordiated amog multiple providers, ad trasitios across care settigs are actively maaged. 3. Providers (icludig urses ad other members of care teams) both withi ad across settigs have accoutability to each other, review each other s work, ad collaborate to reliably deliver high-quality, highvalue care. 4. Patiets have easy access to appropriate care ad iformatio, icludig after hours; there are multiple poits of etry to the system; ad providers are culturally competet ad resposive to patiets eeds. 5. There is clear accoutability for the total care of patiets. 6. The system is cotiuously iovatig ad learig i order to improve the quality, value, ad patiet experiece of health care delivery. 1 Commowealth Fud, Orgaizig the Health Care Delivery System for High Performace (2008). Natioal Associatio of Commuity Health Ceters 8

1 Federally Qualified Health Ceter-Local Health Departmet Parterships: A Strategic Alliace B. The Patiet-Cetered Medical Home Model of Care The 2010 health reform law promotes delivery system iovatio ad improvemet through systems of care such as patiet-cetered medical homes ad accoutable care delivery models. Health reform provides structure ad icetives for providers to orgaize themselves ad share savigs uder a accoutable care orgaizatio (ACO), deliver care via the patiet-cetered medical home (PCMH) model, ad receive budled ad global paymets for acute ad post-acute care. The PCMH cocept, origially itroduced by the America Academy of Pediatrics (AAP) i 1967, received further edorsemet i 2007 whe AAP, together with the America Academy of Family Physicias (AAFP), America College of Physicias (ACP), ad America Osteopathic Associatio (AOA), issued the Joit Priciples of the Patiet-Cetered Medical Home. Now widely accepted amog medical orgaizatios ad associatios, the prevailig medical home cocept is represeted i the Joit Priciples, which emphasize a patiet s ogoig relatioship with a persoal physicia, a whole perso orietatio, team approaches to care, care itegratio ad coordiatio, ehaced access, quality, safety, ad paymet for added value. As oe approach i a larger strategy to trasform how health care is delivered i the Uited States, the PCMH illumiates the role of primary care i cotrollig costs, improvig quality, ad improvig the patiet experiece of care. This framework aims to trasform primary care practices i both the public ad private sectors to esure accessible, timely, comprehesive, patiet-cetered primary care ad effective coordiatio with other providers. Orgaizatios such as the Natioal Committee for Quality Assurace (NCQA) have created widelysupported stadards for recogitio as a PCMH. NCQA s Physicia Practice Coectios Patiet Cetered Medical Home recogitio program is based upo meetig specific elemets i ie stadard categories. The Primary Care Developmet Corporatio (PCDC) offers a How-To Maual for safety et providers ad orgaizatios seekig to achieve NCQA medical home recogitio. Similarly, the America College of Physicias (ACP) has developed a Medical Home Builder SM tool that provides step-bystep istructios, tools, ad resources. NCQA Physicia Practice Coectios Patiet Cetered Medical Home Recogitio Program 2 PPC-PCMH Recogitio is based o meetig specific elemets icluded i ie stadard categories: 1. Access ad Commuicatio 2. Patiet Trackig ad Registry Fuctios 3. Care Maagemet 4. Patiet Self-Maagemet ad Support 5. Electroic Prescribig 6. Test Trackig 7. Referral Trackig 8. Performace Reportig ad Improvemet 9. Advaced Electroic Commuicatio Note: NCQA stadards were recetly ope for public commet; a proposal to collapse ad reduce the categories from ie to six is uder cosideratio. 2 http://www.cqa.org/tabid/631/default.aspx. Natioal Associatio of Commuity Health Ceters 9

1 Federally Qualified Health Ceter-Local Health Departmet Parterships: A Strategic Alliace Yet as the Uited States seeks to optimize primary care, i part by advacig the cocept of the patiet-cetered medical home (PCMH), some of the key values of the CHC model a wholeperso orietatio, accessibility, affordability, high quality, ad accoutability could well iform tomorrow s primary care paradigm for all Americas. Despite the challeges they face, the CHCs are already built o a premise resemblig that of the PCMH, a holistic cocept ecompassig highly accessible, coordiated, ad cotiuous team-drive delivery of primary care that relies o the use of decisio-support tools ad ogoig quality measuremet ad improvemet. 3 Medical home iitiatives withi safety et populatios are i abudace, ad FQHC egagemet is o the rise. Over 40 FQHCs have already achieved NCQA medical home recogitio. Accordig to the Natioal Academy for State Health Policy, more tha 35 state Medicaid agecies have legislated medical home iitiatives, with may fully egaged i demostratios, ad the Medicare-Medicaid Advaced Primary Demostratio Iitiative was aouced i September 2009. The Safety Net Medical Home Iitiative, a five-year demostratio lauched i 2008 by the Commowealth Fud, Qualis Health, ad the MacColl Istitute for Healthcare Iovatio, relies heavily o FQHCs as it seeks to produce a replicable atioal model for implemetig the PCMH i safety et primary care practices. A Natioal Demostratio Project by the America Academy of Family Physicias (AAFP) radomized 36 family practice sites to facilitated versus self-directed groups i implemetatio of the PCMH model. They foud that trasformatio of practices required a tremedous amout of resources ad exteral support. Ad while greater adoptio of medical home compoets was associated with improvemet i measures of quality, prevetio ad chroic disease care, patiet ratigs declied i both the facilitated ad self-directed groups durig this trasformatio process. This evaluatio reports that the jury is still out o the actual impact o quality of care ad patiet outcomes.realistically, it may require reform of the larger delivery system, itegratig primary care with the larger health care system, for the full impact of a PCMH implemetatio to result i statistically sigificat ehacemets to most patiet quality-of-care outcomes. 5 A 2009 study by the Commowealth Fud examied FQHC capacity to fuctio as a medical home based o the presece or absece of five idicators developed from the Natioal Committee for Quality Assurace s medical home measures: Patiet Trackig ad Registry Fuctios; Test Trackig; Referral Trackig; Ehaced Access ad Commuicatio; ad Performace Reportig ad Improvemet. Twety-ie percet of FQHCs had capacity i all five domais; 55% i 3-4 domais; ad 16% i 0-2 domais. A key opportuity for improvemet is i care coordiatio across differet settigs of care. 4 3 Health Care Reform ad Primary Care The Growig Importace of the Commuity Health Ceter, Eli Y. Adashi, MD, H. Jack Geiger, MD, ad Michael D. Fie, MD. New Eglad Joural of Medicie 362:2047-2050 (2010). 4 Ehacig the Capacity of Commuity Health Ceters to Achieve High Performace, Fidigs from the 2009 Commowealth Fud Natioal Survey of Federally Qualified Health Ceters, Michelle M. Doty, Melida K. Abrams, Susa E. Heradez, Kristof Stremikis, ad Ae C. Beal, May 2010. 5 Summary of the Natioal Demostratio Project ad Recommedatios for the Patiet-Cetered Medical Home, Bejami F. Crabtree, PhD, Paul A. Nuttig, MD, MSPH, William L. Miller, MD, MA, Kurt C. Stage, MD, PhD, Elizabeth E. Stewart, PhD ad Carlos Roberto Jaé, MD, PhD Aals of Family Medicie 8:S80-S90 (2010) doi: 10.1370/afm.1107. Natioal Associatio of Commuity Health Ceters 10

1 Federally Qualified Health Ceter-Local Health Departmet Parterships: A Strategic Alliace While the health reform law is atioal i scope, the task of implemetig it ad ultimately trasformig the way health care is delivered i this coutry will fall o state ad local public health ad primary care systems. Meaigful trasformatio will require a uprecedeted level of cooperatio ad itegratio amog various systems of health care delivery both public ad private. Furthermore, the PCMH or health care home for uderserved ad vulerable populatios must support ad build idividual efficacy to maitai or improve health while providig a structure for commuity participatio i the operatio of the health care home. Safety et practices should be egaged parters i a commuity health system that esures access ad coordiatio with specialty care, diagostic services, public health services, health iformatio exchages, hospitals, ad other care settigs as well as agecies ad commuity orgaizatios providig social, educatio, housig, ad other services ecessary to maitai ad improve health. For uderserved ad vulerable patiets, the health care home should fuctio as more of a village, requirig the trasformatio of the local primary care ad public health systems ad strog leadership from withi each. C. Meaigful Use of Health Iformatio Techology It is essetial that FQHCs ad LHDs establish the ability to exchage iformatio for the purposes of coordiatig care for their shared patiets ad to provide the ability to improve populatio health. The Ceters for Medicare ad Medicaid Services released its Fial Rule o the Medicare ad Medicaid Electroic Health Record Icetive Program o July 28, 2010 i the Federal Register. 6 These rules require that eligible professioals use health iformatio techologies, particularly electroic health records, that have the capability to exchage key cliical iformatio (for example, problem list, medicatio list, medicatio allergies, diagostic test results), amog providers of care ad patiet authorized etities electroically to improve care coordiatio. 7 Eligible professioals workig i FQHCs ad meetig the 30% eedy idividuals patiet volume threshold will be required to demostrate successful exchage of cliical iformatio by their secod year of participatio i the Medicaid Icetive Program to receive a icetive paymet for that year. I subsequet years they will be required to have the ability to exchage this data o a regular basis. The rules also specify that eligible professioals may choose to have the capability to submit electroic sydromic surveillace data to public health agecies ad actual submissio i accordace with applicable law ad practice ad/or the capability to submit electroic data to immuizatio registries or immuizatio iformatio systems ad actual submissio accordig to applicable law ad practice as a elemet of meaigful use for purposes of qualifyig for a icetive paymet uder the Icetive Program. 8 These two optios, alog with the capacity to submit electroic data o reportable lab results to public health agecies (applicable oly to hospitals), comprise the objectives aimed at improvig populatio ad public health. For more iformatio regardig electroic health records ad meaigful use, readers may refer to the Departmet of Health ad Huma Services (DHHS) website. 6 42 Fed. Reg. 44314, July 28, 2010. 7 42 Fed. Reg. 44360, July 28, 2010. 8 42 Fed. Reg. 44367, July 28, 2010. Natioal Associatio of Commuity Health Ceters 11

1 Federally Qualified Health Ceter-Local Health Departmet Parterships: A Strategic Alliace D. Partership Beefits The potetial beefits of FQHC-LHD parterships exted beyod the four walls of the exam room ad ito the greater commuity. Parterships put the well-beig of a commuity ito greater focus with overall goals to improve access to care, improve health outcomes, ad decrease health disparities. Specifically, a FQHC-LHD partership may: Systems of Care Ehace the capacity of commuity providers to provide value, high quality, cost-effective medical homes for vulerable populatios. Assist low-icome idividuals to access the full rage of safety et services ad public beefits available i the commuity (e.g., food stamps, substace abuse couselig, Medicaid eligibility, ad other social services). Geerate more positive patiet ad commuity experieces of care ad egagemet i health. Resources Help to avoid the uecessary duplicatio of services, lowerig the costs of providig care ad ultimately stregtheig the existig safety et delivery system. Reduce the eed for more expesive i-patiet ad specialty care services as well as emergecy room visits, resultig i sigificat savigs to a commuity s health care system. Allow limited federal, state ad local resources to be targeted ad allocated to areas that most require them. Cliical Outcomes Reduce chroic disease through the reductio of risk factors, such as smokig. Reduce the spread of ifectious disease i the commuity. Improve immuizatio rates agaist vaccieprevetable diseases. Improve access to preatal care; educate wome about well-baby care, childhood immuizatios, ad utritio; prevet motherto-baby trasmissio of HIV; ad decrease premature birth ad morbidity. Public Health Moitorig Support comprehesive commuity public health assessmets through collaboratio ad sharig of surveillace ad other populatiobased data. Allow providers to gather vital patiet level data through disease registries. Facilitate the parter otificatio process for HIV ad other sexually trasmitted diseases. Natioal Associatio of Commuity Health Ceters 12

Parterships betwee Federally Qualified Health Ceters ad Local Health Departmets 2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets A. Federally Qualified Health Ceter Fudametals 1. Defiig a Federally Qualified Health Ceter A FQHC is a public or private o-profit, charitable, tax-exempt orgaizatio that receives fudig uder Sectio 330 of the Public Health Service Act (Sectio 330), or is determied by the Departmet of Health ad Huma Services (DHHS) to meet requiremets to receive fudig without actually receivig a grat (i.e., a FQHC lookalike ). 9 FQHCs serve as the health care home for 20 millio people atioally through over 7,500 service delivery sites. 10 It is estimated that FQHCs save the atioal health care system up to $24 billio a year. This icludes $6.7 billio i savigs for the federal share of the Medicaid program, ad is drive by lower utilizatio of costly specialty care, emergecy departmets, ad hospitals. 11 FQHCs successfully overcome barriers to care because they are located i high-eed areas; are ope to all residets of their service areas; offer services that facilitate access to care, such as outreach ad trasportatio; ad tailor their services to their patiets ad their commuities uique cultural ad health eeds. 12 FQHC patiets are some of the atio s most vulerable idividuals. Recet surveys idicate: 13 71% of patiets have family icomes at or below the Federal Poverty Level (FPL). 38% of patiets are uisured. 36% of patiets deped o Medicaid. Roughly half of FQHC patiets live i ecoomically depressed ier city commuities with the other half residig i rural areas. FQHC Patiets by Icome Level, 2009 Over 200% FPL 7.5% 151-200% FPL 6.6% 9 Sectio 1861(aa)(4) of the Social Security Act. 10 Fact Sheet- America s Health Ceters. NACHC, August 2010. Available at www.achc.com/research. 11 Fact Sheet- America s Health Ceters. NACHC, August 2010. Available at 101-150% FPL 14.5% www.achc.com/research. 12 Sectio 330 of the Public Health Service Act (42 U.S.C. 254b) ad its implemetig regulatios (42 C.F.R. Part 51c). 100% FPL ad Below 71.4% 13 Fact Sheet- America s Health Ceters. NACHC, August 2010. Available at www.achc.com/research. Note: Federal Poverty Level (FPL) for a family of three i 2009 was $18,310. (See http:// aspe.hhs.gov/poverty/08poverty.shtml.) Based o percet kow. Percets may ot total 100% due to roudig. Source: Bureau of Primary Health Care, HRSA, DHHS, 2009 Uiform Data System. Natioal Associatio of Commuity Health Ceters 13

2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets [Commuity Health Ceters] provide quality care at prices that people ca afford, with the digity ad respect they deserve, ad i a way that takes ito accout the challeges that they face i their lives. Presidet Barack Obama, Remarks by the Presidet o Commuity Health Ceters, December 2009 FQHC Patiets by Race/Ethicity, 2009 America Idia/ Alaska Native 1% Race More tha oe race 5% White 62% Note: Based o percet kow. Percets may ot total 100% due to roudig. Source: Bureau of Primary Health Care, HRSA, DHHS, 2009 Uiform Data System. FQHC Patiets by Isurace Status, 2009 Other Public 3% Medicare 7% Asia/Hawaiia/Pacific Islader 1% Africa America 27% Private 15% Medicaid/SCHIP 36% All Others 67% Uisured 38% Ethicity Hispaic/Latio 33% Note: Other Public may iclude o-medicaid SCHIP. Percets may ot total 100% due to roudig. Source: Bureau of Primary Health Care, HRSA, DHHS, 2009 Uiform Data System. America s Health Ceters owe their existece to a remarkable tur of evets i U.S. history, ad to a few determied commuity health ad civil rights activists workig i lowicome commuities durig the 1960s. Millios of Americas, livig i ier-city eighborhoods ad rural areas throughout the coutry, suffered from deep poverty ad a desperate eed for health care. Amog those determied to seek chage was H. Jack Geiger, the a youg doctor ad civil rights activist. Geiger had studied i South Africa ad witessed how a pioeerig commuity health model had wrought astoishig improvemets i public health. I the 1960s, as Presidet Johso s declared War o Poverty bega to ripple through America, the first proposal for the U.S. versio of a commuity health ceter sprug to life at the Office of Ecoomic Opportuity. Fudig was approved i 1965 for the first two eighborhood health ceter demostratio projects, oe i Bosto, Massachusetts, ad the other i Moud Bayou, Mississippi. You ca read more about the history of the health ceter movemet, ad lear about the pioeers who helped make it happe, at a olie exhibit o global health lauched by the Natioal Library of Medicie. More iformatio about FQHCs is also available at the Faces of Hope Campaig, which was lauched to raise awareess about Commuity Health Ceters. 15 For more tha 40 years, health ceters i the Uited States have delivered comprehesive, high-quality primary health care to patiets regardless of their ability to pay. 14 14 Health Ceters: America s Primary Care Safety Net, Reflectios o Success, 2002-2007. DHHS, HRSA, BPHC, Jue 2008, p. 1. 15 NACHC s press kit is available at http://www.achc.com/press-kit.cfm. Natioal Associatio of Commuity Health Ceters 14

2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets 16 42 U.S.C. 254b(k)(3)(H); 42 C.F.R. 51c.304. 17 Public etities may iclude, but are ot limited to, public hospitals ad muicipal health departmets. Public etities are specifically defied i HRSA PIN 2010-01: Cofirmig Public Agecy Status uder the Health Ceter Program ad FQHC Look-Alike Program available at http://bphc.hrsa.gov/ policy/pi1001/. 18 42 U.S.C. 254b(r)(2)(A). What is a Public Health Ceter? I order to qualify for Sectio 330 fudig, a orgaizatio must, amog other requiremets, be a oprofit private or public etity ad must have a cosumer-directed board of directors that meets specific requiremets with respect to board member selectio, compositio, ad the exercise of broad policy ad oversight authorities. 16 Recogizig that most public etities 17 are ot, ad legally could ot, be govered by a cosumer-directed board, Cogress revised Sectio 330 i 1978 to authorize the DHHS to exped up to 5 percet of the aual Sectio 330 appropriatio i support of public health ceters with goverig boards that do ot fully exercise all of the required authorities. 18 Public health ceters may receive Sectio 330 fudig or may be desigated as a FQHC look-alike. Guidace issued by HRSA, set forth i Policy Iformatio Notice (PIN) 99-09: Implemetatio of the Balaced Budget Act Amedmet, explais that there are two models of public health ceters. Oe is a direct model, i which the public etity meets all of the Sectio 330 FQHC program requiremets. The direct model is extraordiarily ucommo due to the fact that seemigly few public etities have, or legally could have, a board that meets Sectio 330 selectio ad compositio requiremets. The other model is a co-applicat arragemet, which cosists of a public etity ad a co-applicat etity that collectively meet all Sectio 330 requiremets. The public etity receives the grat fuds or lookalike desigatio, ad the co-applicat etity serves as the FQHC s goverig board. Together, the two joitly fuctio as the public health ceter. HRSA PIN 99-09 stipulates that uder the coapplicat model, the co-applicat board for the public health ceter must meet the Sectio 330 compositio ad resposibility requiremets as described o pages 18 19 of this guide, except for the requiremet that the board establish persoel ad fiacial maagemet policies for the public health ceter. HRSA PIN 99-09 also allows for certai joit decisio-makig betwee the public etity ad the co-applicat board, although the board must maitai certai autoomous authorities. LHDs are eligible to apply for desigatio as a public health ceter if they meet the applicable Sectio 330 requiremets, may of which are highlighted o pages 16 20 of this guide, ad qualify as a public agecy, defied as follows: The orgaizatio is a state or a political subdivisio of a state with oe or more sovereig powers. The orgaizatio is a istrumetality of govermet, such as those exempt uder Iteral Reveue Code Sectio 115. The orgaizatio is a subdivisio, muicipality, or istrumetality of a U.S. affiliated sovereig state that is formally associated with the Uited States. The orgaizatio is operated by a Idia tribe or tribal or Idia orgaizatio uder the Idia Self-Determiatio Act or urba Idia orgaizatio uder the Idia Health Care Improvemet Act. For more iformatio o establishig a public health ceter, see NACCHO s issue brief, Developig Quality Applicatios for Commuity Health Ceter Fudig. Natioal Associatio of Commuity Health Ceters 15

2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets 2. Key Federally Qualified Health Ceter Requiremets HRSA ecourages FQHCs to affiliate with other etities, but expects them to remai diliget i complyig with all Sectio 330-related requiremets. 19 It is of utmost importace that FQHCs ad their parterig LHDs cosider Sectio 330 statutory, regulatory, ad policy requiremets throughout the evaluatio ad implemetatio of ay affiliatio. A thorough review of legal cosideratios helps esure that the partership is appropriately structured, reduces exposure to liability, ad protects a FQHC s desigatio. Corerstoes of the FQHC Model There are four corerstoes of the FQHC model, all of which must cotiue to be satisfied uder ay collaboratio. Specifically, the FQHC must: 1. Be located i a federally-desigated medically uderserved area or serve a federally-desigated medically uderserved populatio; 2. Serve all residets of the FQHC s service area or all residets who belog to a targeted special populatio (i.e., migrat ad seasoal farmworkers, homeless idividuals, ad residets of public housig) if the FQHC receives fudig to serve such special populatio, regardless of a idividual s or family s ability to pay; 3. Provide a full cotiuum of primary ad prevetive care services; ad 4. Be govered by a idepedet commuity-based board of directors that complies with all Sectio 330-related size, compositio, ad selectio requiremets ad maitais ad autoomously exercises all authorities ad resposibilities required of a FQHC goverig board. Orgaizatioal Requiremets FQHC orgaizatioal requiremets are set forth i various sources, most otably Sectio 330 of the Public Health Service Act, 20 the DHHS FQHC implemetig regulatios, 21 ad HRSA PIN 98-23: Health Ceter Program Expectatios. Medically Uderserved Area / Medically Uderserved Populatio A orgaizatio must serve a federally-desigated Medically Uderserved Area (MUA) or Medically Uderserved Populatio (MUP) to qualify as a FQHC. MUAs ad MUPs are federal desigatios made by HRSA for defied geographic areas/ populatio groups with isufficiet health resources. Scope of Services FQHCs are required to provide, either directly or through a established arragemet, health services related to family medicie, iteral medicie, pediatrics, obstetrics ad gyecology, diagostic laboratory ad radiological services, pharmaceutical services as appropriate, ad defied prevetive health services. 22 FQHCs are also required to provide (amog other thigs): 23 Patiet case maagemet services; 19 Throughout the guide, the terms affiliatio, collaboratio, ad partership may be used iterchageably to idicate collaborative models of providig care; the use of oe term over the other does ot reflect a particular legal structure. 20 42 U.S.C. 254b. 21 42 C.F.R. 51c. 22 For the complete list of required services, see 42 U.S.C. 254b(b)(1)(A). 23 42 U.S.C. 254b(2)(b)(1)(A). Natioal Associatio of Commuity Health Ceters 16

2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets Services that eable patiets to utilize the FQHC s medical services, icludig outreach ad trasportatio services; ad Educatio of patiets ad the geeral populatio served by the FQHC regardig the availability ad proper use of health services. Accordig to HRSA PIN 2009-02: Specialty Services ad Health Ceters Scope of Project, health services related to metal health ad substace abuse treatmet are cosidered by HRSA to be primary health care services ad are icluded amog the health services that FQHCs are required to provide directly or through cotracts or established arragemets uder Sectio 330. 24 FQHCs may also provide additioal health services that are ot icluded as required primary health services, yet are appropriate to meet the health eeds of the populatio served by the FQHC. 25 FQHCs may iclude specialty services i their scope of project, upo approval by HRSA, if they ca demostrate that the service is a logical extesio of or related to the primary care services provided ad that there is a eed for the service amog the FQHC s patiets. For example, if a FQHC has a large diabetic populatio, services such as ophthalmology, podiatry, ad edocriology may be ecessary compoets of treatmet plas ad, thus, extesios of or related to the primary care furished to this populatio. All of a FQHC s patiets must have reasoable access to the FQHC s full scope of services, either directly or through formal established arragemets. Therefore, the FQHC does ot have to make its full scope of services available at each of its sites, provided that all patiets ca reasoably access all services offered by the FQHC, either at the FQHC s other site(s) or through a established formal arragemet (e.g., referral) with aother provider. There is o formula for determiig reasoable access. To assess if access is reasoable, it is recommeded that FQHCs evaluate the distace betwee sites ad trasportatio barriers. As described i the Scope of Project sectio begiig o page 23 of this guide, this requiremet must be carefully cosidered if a FQHC seeks to add a ew site ad/or service to its scope of project. Schedule of Charges ad Discouts FQHCs must serve all residets of their respective service area, regardless of a idividual s or family s ability to pay. With respect to reimbursemet for such services, FQHCs must have a schedule of charges cosistet with locally prevailig rates ad desiged to cover the FQHC s reasoable costs of operatio. FQHCs also must provide discouts based o ability to pay. 26 Specifically, FQHCs must: Charge patiets whose aual icome is above 200% of the Federal Poverty Level ad thirdparty payors without applyig ay discouts; ad Apply discouts based o ability to pay for uisured ad uderisured patiets whose aual icome is above 100% ad at or below 200% of the Federal Poverty Level. FQHCs may collect, at most, a omial fee from uisured ad uderisured patiets whose aual icome is at or below 100% of the Federal Poverty Level. 27 24 HRSA PIN 2009-02: Specialty Services ad Health Ceters Scope of Project, p. 5 available at http://bphc.hrsa.gov/policy/pi0902/default.htm. 25 Health Care for the Homeless gratees are required to provide substace abuse services (42 U.S.C. 254b (h)(2)). 26 42 U.S.C. 254b(k)(3)(G)(i); see also 42 C.F.R. 51c.303(f). 27 42 U.S.C. 254b(k)(3)(G)(i); see also 42 C.F.R. 51c.303(f). Natioal Associatio of Commuity Health Ceters 17

2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets Sectio 330 also requires FQHCs to assure that o patiet will be deied health care services due to a idividual s iability to pay for such services ad that ay fees or paymets required by the FQHC for such services will be reduced or waived to eable the FQHC to fulfill the assurace. 28 FQHCs must apply their fee schedules ad correspodig schedules of discouts to all patiets, for all services provided withi its scope of project. For example, a FQHC is prohibited from providig LHD patiets with free care, uless such idividuals qualify for a full discout based o their icome level. Procuremet Requiremets ad Stadards FQHCs that are Sectio 330 gratees must comply with the federal procuremet requiremets ad stadards regardig the purchase of goods ad services usig federal grat fuds. 29 The purpose of the federal procuremet requiremets ad stadards is to esure that goods ad services are obtaied i a effective ad efficiet maer. I geeral, the procuremet requiremets ad stadards cotai provisios requirig FQHCs to: (1) establish ad maitai writte stadards of coduct for all employees, cotractors, agets, ad directors, icludig a coflict of iterest provisio; (2) provide for, ad maximize, ope ad free competitio; (3) establish ad maitai writte procuremet procedures; (4) maitai procuremet records; ad (5) maitai a cotract admiistratio system to esure coformace with the terms ad coditios of the cotract, icludig procedures to moitor ad oversee a cotractor s performace. The federal procuremet requiremets ad stadards, as well as the FQHC s applicable policies ad procedures, must be reviewed closely if, as part of a partership with a LHD, the FQHC purchases goods ad/or services. Goverig Board Requiremets A core compoet of the FQHC model is the commuity-based goverig board. Sectio 330, its implemetig regulatios, ad guidace require the followig: Board Compositio 30 The board size should be betwee 9 25 members. At a miimum, a majority of the board members must be active cosumers of the FQHC s services (i.e., persos who utilize the FQHC as their pricipal source of primary care ad have doe so withi the last two years) who collectively represet the idividuals beig served by the FQHC i terms of various demographic factors, such as ecoomic status, race, ethicity, ad geder. The remaiig o-cosumer board members must be represetative of the FQHC s commuity, ad should be selected for their expertise i various fields. No more tha oe-half of the o-cosumer board members may be idividuals who derive more tha te percet of their aual icome from the health care idustry. No member of the board of directors may be a employee of the FQHC or a immediate family member of a employee (i.e., spouse, child, paret, or siblig), by blood, marriage, or adoptio. 28 42 U.S.C. 254b(k)(3)(G)(iii). 29 45 C.F.R. Part 74 (or Part 92 if the etity is a public health ceter). For more iformatio regardig key FQHC cotract issues, see NACHC Issue Brief, Risk Maagemet Series #2: Key Cotract Issues Facig Health Ceters, November 2002 available at http://iweb.achc.com/purchase/productdetail. aspx?product_code=rm_2_02. 30 42 C.F.R. 51c.304. Natioal Associatio of Commuity Health Ceters 18

2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets FQHC Board Resposibilities ad Authorities The FQHC board must exercise the followig authorities: 31 Directly employ ad approve the selectio, aual evaluatio ad dismissal of the Executive Director/Chief Executive Officer. Prepare ad approve the aual budget ad project pla, icludig the aual Sectio 330 grat applicatio or FQHC look-alike certificatio/applicatio. Adopt ad, as ecessary, update fiacial maagemet practices, persoel policies ad procedures, ad health care policies ad procedures. Evaluate the FQHC s activities. Establish ad maitai collaborative relatioships with other health care providers ad social agecies i the relevat service area. Maitai a commitmet to provide services to the medically uderserved populatios(s) served by the FQHC. Evaluate itself for compliace with Sectio 330 requiremets. Assure that the FQHC is operated i compliace with applicable federal, state ad local laws, regulatios, ad policies. For more iformatio regardig public health ceter co-applicat board authorities, see page 15. Role of the FQHC Board i Implemetig FQHC-LHD Parterships It is critical that a FQHC s board of directors is ivolved i key decisios about LHD parterships. This is particularly relevat if a partership ivolves establishig a ew site ad/or the expasio of services. I evaluatig potetial FQHC-LHD parterships, FQHC board members should ask the followig questios: Is the partership with the LHD cosistet with the FQHC s missio? Is the partership with the LHD fiacially viable or would it jeopardize the fiacial stability of the FQHC ad/or its ability to provide the full cotiuum of required primary care, prevetive, ad eablig services? Is prior regulatory approval ecessary to establish the proposed partership with the LHD? I all circumstaces, the board of directors must approve chages i a FQHC s cliical, fiscal, ad quality assurace or quality improvemet policies ad procedures; the scope of services; ad the site locatios ad hours of operatio. Participatio i the FQHC s Board of Directors: Beefits ad Limitatios A FQHC ad LHD may collectively decide that it would beefit the partership to allow the LHD to omiate a represetative to serve o the FQHC s board of directors. It is essetial that FQHCs ad LHDs cosider the followig HRSA restrictios regardig board member selectio ad removal i such situatios where aother orgaizatio (i.e., the LHD) is grated represetatio o the FQHC s goverig board, or some other level of ivolvemet i a FQHC s goverace. 32 I particular, HRSA policies establish that idividuals that are represetatives of aother orgaizatio may ot comprise a majority of the FQHC board members, a majority of the o-cosumer 31 42 C.F.R. 51c.304. 32 HRSA PIN 97-27: Affiliatio Agreemets of Commuity ad Migrat Health Ceters, p. 13 available at http://bphc.hrsa.gov/policy/pi9727.htm ad HRSA PIN 98-24: Amedmet to PIN 97-27 Regardig Affiliatio Agreemets of Commuity ad Migrat Health Ceters available at http://bphc.hrsa.gov/ policy/pi9824.htm. Natioal Associatio of Commuity Health Ceters 19

2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets members, or a majority of members of the Executive Committee, ad may ot serve as the Board Chairperso. I additio, o other orgaizatio may preclude the selectio, or require the dismissal, of board members it has ot appoited. With respect to the board s authorities, as described o the previous page, o other orgaizatio may: have overridig approval authority, have veto authority (through super-majority requiremet or other meas), ad/or have dual majority authority. 3. Cost-Based Reimbursemet, Federal Tort Claims Act, Sectio 340B Drug Pricig, ad Ati-Kickback Safe Harbor Protectio Participatio i the FQHC program provides umerous beefits that may support FQHC-LHD parterships. The four most otable iclude access to the followig: 1. Cost-related reimbursemet for services provided to Medicare, Medicaid, ad Childre s Health Isurace Program (CHIP) beeficiaries; 2. Coverage for the FQHC ad its providers uder the Federal Tort Claims Act (FTCA); 3. Discout drug pricig uder Sectio 340B of the Public Health Service Act; ad 4. Federal Ati-Kickback statute protectio uder the safe harbor for FQHC gratees. Some beefits, such as FTCA coverage ad the Ati- Kickback statute FQHC safe harbor protectio, are oly available to FQHCs that receive Sectio 330 fudig. Other beefits, such as cost-related reimbursemet ad Sectio 340B drug pricig, are available to FQHCs that receive Sectio 330 fudig ad to FQHC look-alikes. Take special ote that the FQHC beefits are oly available whe services are provided by the FQHC withi its scope of project (i.e., the FQHC is the billig provider, services are provided o behalf of the FQHC, services are provided to FQHC patiets, etc.). (Scope of project is described more i depth begiig o page 23.) Both FQHCs ad LHDs should cosider these beefits whe evaluatig partership opportuities, with a eye towards reducig costs ad icreasig access to services across the etire commuity health care system. Cost-Related Reimbursemet I recogitio of the support ad eablig services provided by FQHCs for which they do ot get separately reimbursed ad to esure that they do t have to use Sectio 330 fuds for patiets without a payor source (e.g., Medicare ad Medicaid), FQHC gratees ad look-alikes have access to reimbursemet for Medicare, Medicaid, ad CHIP services through (1) the prospective paymet system or a alterative, state-approved paymet methodology, which, for Medicaid ad CHIP services, is predicated o a cost-based reimbursemet methodology; ad (2) cost-based reimbursemet for Medicare services. 33 This meas that, for the most part, FQHCs will receive a higher rate of reimbursemet from Medicaid, Medicare, ad CHIP tha most other health care etities do for similar services. 33 Accordig to the health reform law, Medicare reimbursemet will trasitio to a prospective paymet system i 2014. Sectio 10501 of Patiet Protectio ad Affordable Care Act of 2010. Natioal Associatio of Commuity Health Ceters 20

2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets Federal Tort Claims Act Coverage (FTCA) FTCA provides professioal liability ad medical malpractice coverage for services provided by a FQHC withi its scope of project. 34 To be eligible for FTCA coverage, a FQHC must receive fuds uder Sectio 330 ad be deemed eligible for coverage. Oce deemed uder FTCA, the FQHC, its officers, directors, employees, ad eligible cotractors are cosidered federal employees immue from suit for medical malpractice claims while actig withi the scope of their employmet ad providig services withi the HRSA-approved scope of project. If a FQHC patiet decides to brig a malpractice lawsuit agaist the FQHC, its employee, covered cotractor, etc., the patiet caot sue the FQHC or the provider directly, but must file the claim agaist the Uited States. Such claims are reviewed ad/or litigated by the DHHS, Office of the Geeral Cousel ad the Departmet of Justice. FTCA is specifically oly available for: The deemed FQHC (as well as its directors ad officers); FQHC employees that provide services o a full-time or part-time basis; Idividually cotracted providers who furish services i the fields of geeral iteral medicie, family practice, geeral pediatrics, ad obstetrics ad gyecology, regardless of the umber of hours worked; ad Idividually cotracted providers who furish services i other fields of practice, so log as they provide such services to FQHC patiets for a aual average of 32 ½ hours a week (i.e., o a full-time basis). As such, FTCA coverage is available oly to the FQHC ad to the employees/cotractors listed above; it caot be exteded to a LHD or its em- FTCA Checklist FQHCs must respod yes to all of the followig questios to assure that FTCA coverage is available for services provided by the FQHC providers uder the FQHC-LHD partership. Satisfyig these questios does ot, however, guaratee FTCA coverage. FQHCs are ecouraged to cosult with HRSA to cofirm FTCA coverage. Does the FQHC receive Sectio 330 fudig? Is the FQHC deemed eligible for FTCA coverage? Are the services provided o behalf of the FQHC ad icluded withi the FQHC s approved scope of project? Is the site where services are provided icluded withi the FQHC s approved scope of project (or does the site meet a defied exceptio for o- FQHC facilities)? Does the idividual qualify as a FQHC patiet ad is he or she appropriately registered? Are the providers FQHC employees, OR, if the providers are cotractors to the FQHC, is the cotractual agreemet directly betwee the FQHC ad the idividual health professioal providig services to the FQHC s patiets, ad does the cotracted provider meet the hour requiremets described above? Are the services provided icluded withi the provider s scope of employmet/cotract? Is the FQHC resposible for billig the payor for the FQHC s services provided to the patiets? 34 Extesive discussio of the legal basis for FQHC FTCA coverage as well as the legal requiremets ad limitatios to such coverage, ca be foud i HRSA PIN 99-08; HRSA PAL 99-15; HRSA PIN 2001-11; HRSA PIN 2002-23; HRSA PIN 2005-01; ad HRSA PIN 2007-16 available at http://bphc.hrsa. gov/policy/default.htm. HRSA plas to release a FTCA Policy Maual, which will provide all FTCA related PINS ad PALS i oe easy referece. See also HRSA PIN 2008-01: Defiig Scope of Project ad Policy for Requestig Chages available at http://bphc.hrsa.gov/policy/pi0801/. Natioal Associatio of Commuity Health Ceters 21

2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets ployees (uless they are idividually cotracted to the FQHC ad satisfy the above criteria). I additio, with certai limited exceptios, FTCA oly covers services provided to the FQHC s patiets served at a site withi the FQHC s scope of project, as described o pages 23 25. Discout Drug Pricig Uder Sectio 340B of the Public Health Service Act 35 FQHC gratees ad look-alikes are eligible to participate i the discout drug pricig program uder Sectio 340B of the Public Health Service Act. Sectio 340B drugs may be distributed either directly by a FQHC pharmacy or through cotract with a retail pharmacy. 36 Drugs purchased uder the Sectio 340B program may be dispesed oly to the FQHC s patiets. As such, the FQHC caot supply 340B drugs to idividuals who are ot registered FQHC patiets. 37 A idividual is ot a patiet for Sectio 340B purposes if he or she oly receives services related to the dispesig of a drug or drugs for subsequet self-admiistratio or admiistratio i the home. I other words, a relatioship based solely o case maagemet is isufficiet to establish the idividual as a FQHC patiet. A FQHC s ability to purchase drugs at discouted prices provides the FQHC with a effective meas to lower drug prices for its uisured patiets ad to provide better health care for its patiets. The savigs is particularly importat to cosider whe structurig parterships with LHDs give the sigificat health care eeds amog idividuals that seek care at LHDs. (For more iformatio regardig the availability of Sectio 340B drugs i the cotext of a referral arragemet betwee a FQHC ad LHD, see page 44.) 340B Drug Pricig Checklist FQHCs must respod yes to all of the followig questios to assure that Sectio 340B drug pricig is available uder the FQHC-LHD partership. As with FTCA, satisfyig these questios does ot guaratee access to Sectio 340B drug pricig. To cofirm access to Sectio 340B drug pricig, FQHCs are ecouraged to register ad cosult with the Office of Pharmacy Affairs at HRSA. Does the idividual qualify as a FQHC patiet ad is he or she appropriately registered? Is the FQHC resposible for orderig ad purchasig the drugs? Ca the FQHC, at a miimum, break-eve from a reimbursemet perspective? Ca the FQHC establish a trackig system (or a alterative system approved by the Office of Pharmacy Affairs) to esure that the drugs purchased uder the Sectio 340B program are ot resold, trasferred, or diverted to o-fqhc patiets? 35 Sectio 340B of the Public Health Service Act (42 U.S.C. 256b), as ameded by Sectio 602 of P.L. 102-585 (11/11/92). 36 Note that federal law precludes a cotract pharmacy from dispesig 340B drugs to Medicaid patiets uless that pharmacy has made arragemets with the state Medicaid agecy that will eable the state to avoid seekig a rebate from a maufacturer for a drug purchased uder 340B. 37 Accordig to Sectio 340B, a idividual curretly qualifies as a patiet whe the followig requiremets are satisfied: (See 61 Fed. Reg. 55156 (October 24, 1996): (1) the FQHC has established a relatioship with the idividual ad maitais records of the idividual s health care; (2) the idividual receives health care services from a health care professioal who is either employed by or provides health care uder a cotractual or other arragemet (e.g., referral for cosultatio) with the FQHC, such that the resposibility for care remais with the FQHC; ad (3) the idividual receives a health care service or a rage of services from the FQHC cosistet with the service or rage of services for which the etity received FQHC status (i.e., the services are withi the FQHC s approved scope of project). Natioal Associatio of Commuity Health Ceters 22

2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets Federal Ati-Kickback Statute Protectio Uder the Safe Harbor for FQHC Gratees The purpose of the federal Ati-Kickback statute is to discourage arragemets that could result i higher costs to the federal govermet or egatively impact the quality of care provided to beeficiaries of federal health care programs, such as the Medicaid ad Medicare programs. I particular, the statute prohibits ay perso or etity from kowigly or willfully solicitig or receivig (or offerig ad payig) remueratio directly or idirectly, i cash or i kid, to iduce patiet referrals or the purchase or lease of equipmet, goods or services, payable i whole or i part by a federal health care program. 38 Remueratio is defied broadly to iclude the trasfer of aythig of value, icludig reduced cost (or o cost) ret or equipmet, reduced cost (or o cost) purchase of services agreemets, rebates, ad free goods ad/or services. For example, uder the Ati-Kickback statute, a private practice physicia is prohibited from acceptig free space from a hospital i exchage for referrig patiets that are erolled i a federal health care program (e.g., Medicare, Medicaid, CHIP). Cogress ad the Office of the Ispector Geeral ( OIG ), the federal agecy with legal authority to eforce the federal Ati-Kickback statute, have created safe harbors to exempt certai busiess practices from costitutig violatios of the federal Ati-Kickback statute. I 2007, the OIG at DHHS established regulatory stadards for a FQHC safe harbor. 39 The safe harbor protects from prosecutio certai arragemets betwee FQHC gratees ad providers/suppliers of goods, items, services, doatios, ad loas that cotribute to the FQHC s ability to maitai or icrease the availability or ehace the quality of services provided to its medically uderserved patiets. For such protectio, the arragemet must be codified i a writte agreemet ad meet several stadards that are set forth i regulatio. 40 For example, the FQHC must have a reasoable expectatio that the arragemet will cotribute meaigfully to services to the uderserved, ad the FQHC must periodically (at least aually) re-evaluate the arragemet to esure that it cotiues to meet the origial expectatio. Accordigly, it may be permissible for a FQHC to receive doatios (moetary ad i-kid) ad/or obtai low cost (or o cost) leases ad/or purchase agreemets from a LHD ad/or other commuity health care providers with which it has a referral relatioship, provided that the doatios, leases, agreemets, etc. are part of a arragemet to maitai/icrease services provided to the FQHC s medically uderserved patiets, ad provided that the parties execute a writte agreemet that satisfies the safe harbor requiremets. If a FQHC seeks to eter ito such a arragemet, it should cosult kowledgeable local cousel for guidace. 4. Federally Qualified Health Ceter Scope of Project Cosideratios Defiig Scope of Project: Sites ad Services Scope of project defies the services, sites, providers, service area, ad target populatio that the total approved Sectio 330 grat-related project supports (or, i the case of FQHC look-alikes, the services, sites, providers, service area, ad target populatio that the FQHC desigatio supports). 41 38 42 U.S.C. 1320a-7b(b). 39 72 Fed Reg 56632 (October 4, 2007), as codified at 42 C.F.R. 1001.952(w). 40 42 C.F.R. 1001.952(w). 41 41 HRSA PIN 2008-01, p. 2 available at http://bphc.hrsa.gov/policy/ pi0801/ ad HRSA PIN 2009-06: Federally Qualified Health Ceter Look-Alike Guidelies ad Applicatio available at http://bphc.hrsa.gov/policy/pi0906/. Natioal Associatio of Commuity Health Ceters 23

2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets Services: As oted o pages 16 17, Sectio 330 requires FQHCs to provide, either directly or through formal established arragemets, all required primary care services. FQHCs may also provide additioal health services that are appropriate to meet the eeds of their patiets. Oce a service is icluded i scope, it must be reasoably available to all patiets ad provided, regardless of a idividual s or family s ability to pay. (Additioal iformatio o services is provided below.) Sites: A site is ay place where a FQHC provides services to a defied geographic service area or populatio o a regularly scheduled basis. (Additioal iformatio o sites is provided below.) Providers: Providers are idividual health care professioals who deliver services o behalf of the FQHC o a regularly scheduled basis ad who exercise idepedet judgmet as to the services furished durig a ecouter. Service Area: The service area is the geographic area that is served by the FQHC. Target Populatio: The target populatio is the medically uderserved commuity or special populatio served by the FQHC (which may be a sub-set of the service area or may iclude the etire service area). A FQHC s scope of project is importat because it (amog other thigs): Determies the maximum potetial scope of FTCA coverage (subject to certai exceptios). Provides the ecessary iformatio which eables FQHCs to purchase discouted drugs Defies the services ad sites eligible for costbased reimbursemet uder Medicare, Medicaid, ad CHIP. What is a Health Ceter Site for Purposes of Scope of Project? HRSA broadly defies a service site as ay locatio where a gratee provides primary health care services to a defied service area or target populatio as appropriate for providig health care services to the target populatio. 42 If a locatio where services are provided satisfies the followig four coditios, the the locatio should qualify as a site for purposes of scope of project, subject to approval by HRSA. 43 1. Providers geerate face-to-face ecouters with patiets. 2. Providers exercise idepedet judgmet i providig services. 3. Services are provided directly by or o behalf of the FQHC the FQHC board retais cotrol ad authority over the provisio of the services at the locatio. 4. Services are provided o a regularly scheduled basis. It is importat to ote that a fully-equipped mobile va that is staffed by FQHC cliicias providig direct primary care services (e.g., primary medical or oral health services) at various locatios o behalf of the FQHC is cosidered a service site. 44 Evaluatig whether a locatio qualifies as a site is of critical importace i the cotext of FQHC- LHD parterships where the FQHC seeks to provide services at a ew locatio. If the locatio does ot through the Sectio 340B drug pricig program. 42 HRSA PIN 2008-01, p. 4. 43 HRSA PIN 2008-01, p. 4. 44 HRSA PIN 2008-01, p. 6. Natioal Associatio of Commuity Health Ceters 24

2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets qualify as a FQHC site, the the FQHC may ot add the locatio to its HRSA-approved scope of project, ad it is likely that the FQHC will ot be eligible to receive cost-based reimbursemet, FTCA coverage, Sectio 340B prescriptio drugs, ad other FQHCrelated beefits. What is a FQHC Service for Purposes of Scope of Project? As described o pages 16 17, Sectio 330 requires FQHCs to provide, either directly or by cotract or referral, certai required primary ad prevetive health services, as well as eablig services. FQHCs also may provide additioal health services that are ot required, yet are appropriate to meet the health eeds of the populatio served by the FQHC. 45 I additio, all of a FQHC s patiets must have reasoable access to the FQHC s full scope of services, either directly or through formal established arragemets. The FQHC does ot have to make its full scope of services available at each of its sites, provided that all patiets ca reasoably access all services offered by the FQHC, either at the FQHC s other site(s) or through a established formal arragemet (e.g., cotract or referral) with aother provider. There is o formula for determiig reasoable access. To assess if access is reasoable, a FQHC should evaluate the distace betwee the two sites ad the availability of public trasportatio. If a FQHC-LHD partership icludes the FQHC s additio of a ew service ad/or site, the FQHC must examie whether all patiets will have access to the FQHC s full scope of services. If a FQHC does ot add a ew service or site, but rather adds LHD patiets as FQHC patiets, thereby expadig the FQHC s patiet base, the FQHC must examie whether the ew patiets will have access to the FQHC s full scope of services. Chagig a Health Ceter s Scope of Project FQHCs must obtai HRSA s prior approval before addig or removig a service, or addig, removig, or relocatig a site, from its scope of project. Failure to secure HRSA s prior approval for the chage i scope may have serious cosequeces, icludig: No FTCA malpractice coverage for the employed or cotracted FQHC practitioers, or for the FQHC itself vis-à-vis such services/sites. Allegatios that the FQHC diverted Sectio 340B drugs by providig them to idividuals who are ot FQHC patiets. I order to obtai HRSA s approval, the chage i scope request must: 46 Documet that the requested chage ca be fully accomplished with o additioal federal support. 47 Not shift resources away from providig services to the curret target populatio. Further the FQHC s missio by icreasig or maitaiig access ad improvig or maitaiig quality of care for the target populatio. Be fully cosistet with Sectio 330 ad the Health Ceter Program Expectatios (HRSA PIN 98-23), icludig appropriate goverig board represetatio for chages i service sites ad populatios served. Provide for appropriate credetialig/privilegig of providers. 45 42 U.S.C. 254b (2) (b)(1)(a). 46 HRSA PIN 2008-01, pp. 20-22. 47 HRSA PIN 2008-01, p 20. A FQHC requestig to add a service or site must demostrate that adequate reveue will be geerated to cover all expeses as well as a appropriate share of overhead costs icurred by the FQHC i admiisterig the ew service or site. Natioal Associatio of Commuity Health Ceters 25

2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets Not elimiate or reduce access to a required Protect people from health problems ad service. health hazards; Not result i the dimiutio of the FQHC s total Give people iformatio they eed to make level or quality of health services curretly pro- healthy choices; vided to the target populatio. Egage the commuity to idetify ad solve Demostrate that the FQHC cotiues to serve a health problems; medically uderserved area i whole or i part, Develop public health policies ad plas; or a medically uderserved populatio. Eforce public health laws ad regulatios; Demostrate approval by the FQHC s board of Help people receive health services; directors. Maitai a competet public health workforce; Not sigificatly affect the curret operatio of ad aother FQHC located i the same or adjacet Evaluate ad improve programs ad service area. itervetios. For additioal iformatio, FQHCs should review HRSA PIN 2008-01: Defiig Scope of Project ad Policy for Requestig Chages, which provides comprehesive guidace regardig the process for obtaiig approval for a chage i scope of project. B. Local Health Departmet Fudametals Fuctio Local health departmets (LHDs) are the govermetal public health presece at the local level, resposible for creatig ad maitaiig coditios that keep people healthy. A LHD may be a locally govered health departmet, a brach of a state health departmet, a state-created district or regio, a departmet govered by ad servig a multi-couty area, or ay other arragemet that has govermetal authority ad is resposible for public health fuctios at the local level. Whether they directly provide a service, broker particular capacities, or otherwise esure that the ecessary work is beig doe, LHDs have a cosistet resposibility to: 48 Moitor health status ad uderstad health issues facig the commuity; LHDs uderstad the specific health issues cofrotig the commuity, icludig how physical, behavioral, evirometal, social, ad ecoomic coditios affect health. They ivestigate health problems ad health threats ad prevet ad cotrol adverse health effects from commuicable diseases, disease outbreaks from usafe food ad water, chroic diseases, evirometal hazards, ijuries, ad risky health behaviors. LHDs also lead plaig ad respose activities for public health emergecies ad collaborate with other local respoders ad with state ad federal agecies to itervee i other emergecies with public health sigificace (e.g., atural disasters). I a ideal cotext ad eviromet, LHDs coordiate the broader public health system s efforts i a itetioal, o-competitive, ad o-duplicative maer. They implemet health promotio programs 48 The stadards are framed aroud the Te Essetial Public Health Services, which have bee reworded to more accurately reflect the specific LHD roles ad resposibilities related to each category. I additio, these stadards are cosistet with the Natioal Public Health Performace Stadards Program (NPHPSP), servig to specify the role of govermetal LHDs while the NPHPSP addresses the public health system as a whole. Natioal Associatio of Commuity Health Ceters 26

2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets ad egage the commuity to address public health issues. They develop parterships with public ad private healthcare providers ad istitutios (such as FQHCs), commuity-based orgaizatios, ad other govermet agecies (e.g., housig authority, crimial justice, educatio) egaged i services that affect health to collectively idetify, alleviate, ad act o the sources of public health problems. LHDs also address health disparities; serve as a essetial resource for local goverig bodies ad policymakers o up-to-date public health laws ad policies; ad provide sciece-based, timely, ad culturally competet health iformatio ad health alerts to the media ad to the commuity. Likewise, LHDs provide expertise to others who treat or address issues of public health sigificace ad esure compliace with public health laws ad ordiaces, usig eforcemet authority whe appropriate. LHDs employ well-traied staff ad esure that they have the ecessary resources to implemet best practices ad evidece-based programs ad itervetios. LHDs cotribute to the evidece base of public health ad strategically pla their services ad activities, evaluate performace ad outcomes, ad make adjustmets as eeded to cotiually improve their effectiveess, ehace the commuity s health status, ad meet the commuity s expectatios. All LHDs derive their authority ad resposibility from the state ad local laws that gover them. LHDs legal authorities may iclude itervetios such as madatory isolatio ad quaratie or the authority to eter ad ispect property, records, or equipmet ad require corrective actios for violatios. However, there is wide variability i LHDs capacity, authority, resources, ad compositio of the broader local public health system withi which they fuctio. As a result of these differeces, how LHDs meet their resposibilities whether they directly provide a service, broker particular capacities, or otherwise esure that the ecessary work is beig doe will vary. The LHD may have the capacity to perform all of the fuctios o its ow; it may call upo the state to provide assistace for some fuctios; it may develop arragemets with other orgaizatios i the commuity or with eighborig LHDs to perform some fuctios; or it may cotrol the meas by which other etities perform some fuctios. I some jurisdictios, other govermet agecies may have the authority to perform services that affect public health, ad/or resources for public health may be housed i a differet agecy. LHDs ca help FQHCs address critical elemets of esurig service delivery ad expasio i a variety of ways, icludig the followig: Cotributig ifrastructure support; Helpig FQHCs coect with their commuity; Collectig, providig, ad coordiatig commuity data; Providig a populatio-based perspective o local issues to iform FQHC commuicatios; Coveig commuity members, with local boards that iclude FQHC represetatives; Collaboratig o FQHC applicatios for fudig; Idetifyig appropriate populatios, geographic areas, ad parters for collaboratio; Usig regulatory authority to address idetified public health threats; ad Eforcig public health laws ad regulatios. Natioal Associatio of Commuity Health Ceters 27

2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets Goverace LHDs ca be govered by local authorities (e.g., local board of health, couty or city elected officials), by the state health agecy, or both. As show i the map below, as of 2008, LHDs i 29 states had local goverace, whereas six states ad Washigto, DC, had state goverace, ad 13 had mixed goverace. I 2008, about 80 percet of all LHDs reported that they had a associated local board of health. Members of local boards of health may be elected, appoited, or desigated based o a elected or o-elected positio. Local boards of health serve may fuctios withi their commuities, such as adoptig public health regulatios, settig ad imposig fees, approvig the LHD budget, hirig or firig the top agecy admiistrator, ad requestig a public health levy. I 2008, adoptig public health regulatios (73%) ad settig ad imposig fees (68%) were the two most commo fuctios of local boards of health. LHD Goverace Type, by State All LHDs i the state are uits of local govermet All LHDs i the state are uits of state govermet Some LHDs i the state are uits of local govermet ad others are uits of state govermet No participats: Hawaii ad Rhode Islad Source: 2008 Natioal Profile of Local Health Departmets Natioal Associatio of Commuity Health Ceters 28

2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets Fudig Fudig for local public health activities comes from a umber of sources, icludig local, state, ad federal govermet; reimbursemet from Medicare, Medicaid, ad other isurers; regulatory fees ad fees paid for patiet services; ad miscellaeous sources such as private foudatios. I geeral, it ca be said that LHD reveues from local, state, federal pass-through, ad Medicare ad Medicaid, as a percet of total reveues, vary widely by state. As reflected i the chart below, i 2008, local fuds were the highest source of reveue for LHDs, comprisig 25 percet of all reveues, followed by state direct (20%), ad federal pass-through (17%). Percetage Distributio of Total Aual LHD Reveues, By Reveue Source Relatioship to the State Health Departmet Like LHDs, state health departmets also vary widely ad have varied structures, fuctios, goverace, ad fudig. State health departmets perform a umber of the core public health fuctios, icludig the followig: Medicare 5% Federal Direct 2% Fees 11% Medicaid 10% Other 7% Disease trackig ad ivestigatio; Maiteace of birth ad death records; Delivery of chroic disease prevetio ad cotrol programs; Federal Pass-Through 17% Local 25% raged from 1,458 to 1,629 by reveue source Note: Due to roudig, percetages do ot add to 100. *Amog LHDs reportig detailed reveue data. Source: 2008 Natioal Profile of Local Health Departmets Not Specified 2% State Direct 20% Admiistratio ad trackig of immuizatios; Coductig a wide rage of laboratory services; Delivery of materal ad child health programs; ad Maagig state bioterrorism preparedess. State health departmets are typically fuded by the federal govermet, state budgets through appropriatios made by a state s legislature, ad, less ofte, by private sources, such as foudatios. Federal fudig ca come i several forms, icludig: 1) formula grats, such as the Materal ad Child Health Block Grat (Title V) ad the Prevetive Health ad Health Services Block Grat; 2) competitive grats through which departmets apply for federal fuds for specific iitiatives o topics such as utritio ad physical activity; 3) data collectio ad aalysis fuds to gather ad iterpret critical health iformatio about the populatios they serve; ad 4) health isurace fuds to admiister such programs as Medicaid ad the Childre s Health Isurace Program (CHIP). The states role i goverig local public health varies accordig to the structure ad resposibilities of the state health departmet ad icludes the followig: Cetralized: The state health departmet operates the LHDs, ad the local departmet fuctios uder the state departmet s authority. Decetralized: Local govermets orgaize ad operate LHDs. Shared systems: LHDs operate uder the shared authority of the state health departmet, the local govermet, ad/or local boards of health. Mixed systems: LHDs provide local public health services ad are orgaized ad operated by uits of local govermet i some jurisdictios ad the state health departmet i other jurisdictios. Natioal Associatio of Commuity Health Ceters 29

2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets State Associatios of Couty ad City Health Officials (SACCHOs) are orgaizatios that represet LHDs or officials at the state level. Some SACCHOs are a office i their state s departmet of health ad may are iformal orgaizatios that are admiistered by voluteers. SACCHOs ofte host regular meetigs of local public health officials ad are very ivolved with local public health issues at the state level. The Natioal Associatio of Couty ad City Health Officials (NACCHO) collaborates with SACCHOs o may projects, icludig joit meetigs, membership iitiatives, educatio ad traiig, ad atioal advocacy for local public health. SACCHOs also work closely with state departmets of health ad other state ad atioal public health orgaizatios. Jurisdictios LHDs serve a variety of jurisdictio types. As of 2008, most LHDs serve idividual couties (60%), while others serve combied city-couty jurisdictios (11%), multi-couty or other district or regioal level jurisdictios (9%), tows or towships (11%), ad cities (7%). Local public health capacity varies greatly amog states, ragig from states with little local public health ifrastructure ad few resources to states that serve every couty ad muicipality through local public health. I geeral, multi-couty or regioal health departmets that have access to more resources provide a more comprehesive set of services tha smaller departmets. The figure o the right shows the percetage of LHDs servig small, medium ad large populatios as well as the percetage of U.S. populatio served withi each category. Natioal Profile Study The Natioal Associatio of Couty ad City Health Officials (NACCHO) Natioal Profile of Local Health Departmets study (Profile study) is the key source of iformatio to characterize LHDs at the atioal level. The Profile study series collects iformatio o a rage of public health ifrastructure topics from all LHDs i the Uited States. The most recet Profile study was coducted i 2008 ad surveyed a study populatio that cosisted of 2,794 LHDs. The purpose of the Profile study is to advace ad support the developmet of a database to describe ad uderstad LHDs structure, fuctio, ad capacities. The 2008 Profile study icluded a assessmet of the overall structure, fuctio, workforce ad availability of public health activities ad services at the local level; it also icluded a assessmet to uderstad what govermetal ad o-govermetal etities provided these services at the local level. Percetage of LHDs ad Percetage of U.S. Populatio Served, by Size of Populatio Served 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 12% 64% 41% Percetage of U.S. Populatio Served Percetage of all LHDs 31% 46% 0% Small Medium Large (<50,000) (50,000 499,000) (500,000+) Size of Populatio Served 5% =2,794 Source: 2008 Natioal Profile of Local Health Departmets Natioal Associatio of Commuity Health Ceters 30

2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets Workforce The workforce compositio of LHDs varies greatly across jurisdictios. I 2008, most LHDs (89%) had less tha 100 full-time equivalets (FTEs), about 20 percet of LHDs had less tha five FTEs ad oly five percet had 200 or more FTEs. The total media umber of FTEs raged from three (for LHDs servig populatios less tha 10,000) to 585 (for LHDs servig populatios of oe millio or more). The total media umber of staff raged from five (for LHDs servig populatios less tha 10,000) to 692 (for LHDs servig populatios of oe millio or more). Although LHD staffig varies across jurisdictios, most LHDs geerally maitai a few core job fuctios. I 2008, more tha 90 percet of LHDs employed clerical staff, urses, ad maagers. Evirometal health workers, emergecy preparedess coordiators, health educators, ad utritioists were employed by more tha 50 percet of all LHDs. The 2008 Profile study suggests that occupatios represeted at LHDs vary by the size of the populatios they serve. Amog LHDs servig the smallest populatios (less tha 10,000), 85 percet employed clerical staff ad 82 percet employed urses; amog LHDs servig the largest populatios (1,000,000 or more), all (100%) employed staff i these categories. Evirometal health specialists were employed by 54 percet of LHDs servig the smallest populatios ad 88 percet of LHDs servig the largest populatios. About oe fourth of the LHDs servig populatios of less tha 10,000 employed health educators ad utritioists, whereas almost all LHDs (97%) servig populatios of oe millio or more reported employmet of health educators ad 88 percet reported employmet of utritioists. As of 2008, for all LHDs, the media umber of FTEs was 15, which geerally icluded five urses, four clerical staff, oe maager, oe evirometal health specialist, ad oe health educator o staff. As size of the populatio served icreased, LHDs teded to have more occupatios represeted i staffig patters, with oe emergecy preparedess coordiator ad at least oe utritioist at LHDs servig 50,000 or more, ad at least oe physicia at LHDs servig 100,000 or more. The two tables that follow provide detailed iformatio about the workforce of LHDs by size of populatio served. Mea ad Media Number of Employees ad FTEs at LHDs, by Size of Populatio Served Number of Employees Source: 2008 Natioal Profile of Local Health Departmets Number of FTEs Size Populatio Served Mea Media Mea Media <10,000 8 5 5 3 10,000 24,999 16 10 13 8 25,000 49,999 26 18 22 15 50,000 99,999 50 35 42 31 100,000 249,999 90 74 80 66 250,000 499,999 185 160 168 147 500,000 999,999 494 331 430 305 1,000,000+ 1,080 692 994 585 All LHDs 66 18 58 15 =2,234 =2,205 Natioal Associatio of Commuity Health Ceters 31

2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets Media FTEs ad Staffig Patters for LHDs, by Size of Populatio Served Servig 10,000 24,999 Servig 50,000 99,999 Servig 100,000 499,999 8 FTEs, icludig: 31 FTEs, icludig: 81 FTEs, icludig: 1 Maager/Director 1 Maager/Director 5 Maagers/Directors 3 Nurses 8 Nurses 17 Nurses 2 Clerical Staff 7 Clerical Staff 18 Clerical Staff 1 EH Specialist 3 EH Specialists 9 EH Specialists 1 Nutritioist 3 Nutritioists 1 Health Educator 2 Health Educators 1 EP Coordiator 1 EP Coordiator raged from 1,794 to 1,992 based o occupatio Note: Numbers do ot add to totals because listed occupatioal categories were ot exhaustive of all LHD occupatios. Source: 2008 Natioal Profile of Local Health Departmets 1 Physicia 1 Epidemiologist 1 IS Specialist 1 BH Professioal Services Services provided by LHDs vary broadly by jurisdictio ad populatio served. These services iclude but are ot limited to immuizatio services; screeig for diseases ad coditios; treatmet for commuicable diseases; materal ad child health services; primary care ad other health services; populatio-based primary prevetio services; surveillace ad epidemiology; evirometal health; regulatio, ispectio, ad licesig; ad other activities. The table o the right presets the 10 activities ad services provided most frequetly i LHD jurisdictios by LHDs. LHDs egage i a umber of activities ad provide services that cotribute directly ad idirectly to the provisio of primary care services. While they do ot ecessarily eed to provide primary care services, they do eed to assure that the health eeds of the commuity are beig met ad that vulerable populatios, i particular, have access to high-quality care. The LHD may have the capacity to provide all of these services o its ow or may Percetage of LHD Jurisdictios with 10 Most Frequet Activities ad Services Available Through LHDs Directly Percetage of Rak Activity or Service Jurisdictios 1 Adult Immuizatios Provisio 88% 2 Commuicable/Ifectious Disease Surveillace 88% 3 Child Immuizatios Provisio 86% 4 Tuberculosis Screeig 81% 5 Food Service Establishmet Ispectio 77% 6 Evirometal Health Surveillace 75% 7 Food Safety Educatio 74% 8 Tuberculosis Treatmet 72% 9 Tobacco Use Prevetio 70% 10 Schools/Daycare Ceter Ispectio 68% Source: 2008 Natioal Profile of Local Health Departmets Natioal Associatio of Commuity Health Ceters 32

2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets develop arragemets with other orgaizatios i the commuity (such as FQHCs), with eighborig LHDs, or with the state to perform some services. I 2008, LHDs varied i their capacity to provide persoal care ad primary prevetative services ad ofte provided these services through arragemets with other govermetal agecies, icludig the state. These services iclude oral health, home healthcare, comprehesive primary care, behavioral/metal health services, ad substace abuse services. For oral health, home healthcare, ad comprehesive primary care, the LHD was the govermetal agecy most likely to provide these services; for behavioral/metal health services ad substace abuse services, other local govermetal agecies were most likely to provide these services. The first graph that follows shows the percetage of LHD jurisdictios i which primary care ad other health services were provided ad by which govermetal agecy. The secod graph shows the percetage of LHDs providig each service by the size of the populatio served. Percetage of LHD Jurisdictios with Other Health Services Provided by Govermetal Agecies Oral Health Home Healthcare Comprehesive Primary Care Behavioral/Metal Health Services Substace Abuse Services O% 20% 40% 60% 80% 100% Percetage of Jurisdictios LHD Direct LHD Cotract LHD Direct ad Cotract* Other Local Govermetal Agecy* State Agecy* *Provided by other agecy oly, ot LHD. Selected agecy combiatios oly; does ot iclude all possible combiatios. Source: 2008 Natioal Profile of Local Health Departmets Percetage of LHDs Providig Other Health Services, by Size of Populatio Served 25,000 50,000 100,000 Service All LHDs <25,000 49,999 99,999 499,999 500,000+ Oral Health 29% 20% 24% 33% 43% 57% Home Healthcare 25% 28% 25% 26% 18% 11% Comprehesive Primary Care 11% 7% 9% 16% 16% 25% Behavioral/Metal Health Services 9% 5% 9% 12% 13% 27% Substace Abuse Services 7% 4% 7% 8% 9% 24% Source: 2008 Natioal Profile of Local Health Departmets Natioal Associatio of Commuity Health Ceters 33

2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets Other health care services that most LHDs provided i 2008 were Materal ad Child Health (MCH) home visits (63%), Wome, Ifats ad Childre (WIC) services (62%), ad family plaig services (54%). Early Periodic Screeig, Diagosis, ad Treatmet (EPSDT) program services were offered by 44 percet of LHDs. I additio, LHDs also provided Well Child Cliics (41%), preatal care (33%), ad obstetrical care (10%). I 2008, primary prevetio services for tobacco, utritio, chroic disease, uiteded pregacies, ad physical activity were foud i more tha 80 percet of local jurisdictios. However, LHDs reported that primary prevetio services were most frequetly provided by o-govermetal orgaizatios. LHD activity i the area of primary prevetio services is described i the first table below. The percetage of LHDs offerig populatio-based primary prevetio services raged from 70 percet (tobacco use primary prevetio) to 12 percet (primary prevetio of metal illess). I 2008, govermetal agecies provided screeig i more tha 70 percet of LHD jurisdictios for tuberculosis, high blood pressure, blood lead, HIV/ AIDS, ad other STDs. For all of these selected diseases ad coditios, the LHD was the most ofte cited govermetal agecy that providig screeig services. The secod graph that follows exhibits the percetage of LHD jurisdictios with screeig services for select diseases ad coditios provided by govermetal agecies, icludig LHDs. Percetage of LHD Jurisdictios with Selected Populatio-Based Primary Prevetio Services Provided by LHDs, by Size of Populatio Served 25,000 50,000 100,000 Primary Prevetio Service All LHDs <25,000 49,999 99,999 499,999 500,000+ Tobacco 70% 63% 73% 75% 75% 84% Nutritio 68% 58% 68% 73% 81% 85% Chroic Disease Programs 53% 44% 57% 58% 62% 79% Physical Activity 53% 45% 55% 57% 63% 73% Uiteded Pregacy 51% 44% 53% 53% 60% 71% Ijury 39% 33% 38% 43% 49% 62% Substace Abuse 24% 21% 25% 28% 24% 33% Violece 22% 18% 22% 24% 28% 44% Metal Illess 12% 10% 11% 15% 13% 20% Source: 2008 Natioal Profile of Local Health Departmets Natioal Associatio of Commuity Health Ceters 34

2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets Percetage of LHD Jurisdictios with Screeig for Selected Diseases ad Coditios Provided by Govermetal Agecies Tuberculosis High Blood Pressure Blood Lead Other STDs HIV/AIDs Diabetes Cacer Cardiovascular Disease O% 20% 40% 60% 80% 100% Percetage of Jurisdictios LHD Direct LHD Cotract LHD Direct ad Cotract Other Local Govermetal Agecy* State Agecy* *Provided by other agecy oly, ot LHD. Selected agecy combiatios oly; does ot iclude all possible combiatios. Source: 2008 Natioal Profile of Local Health Departmets The Role of LHDs i Commuity Health Assessmets FQHCs seekig to coduct a commuity health assessmet should look to their LHD as a key parter with uique skills, capacities, ad perspectives i populatio health. As part of their charge to moitor health status to idetify ad address commuity health problems, LHDs ofte coduct or parter with other orgaizatios to coduct commuity health assessmets (CHAs). Nearly two thirds of LHDs have either coducted a CHA i the past year or pla to do so i the ext three years. I 2011, the Volutary Natioal Accreditatio of Local Health Departmets Program will provide a additioal icetive for coductig CHAs. A coditio for LHD accreditatio will be participatio i or coduct of a CHA that will iform additioal requiremets for the developmet of a commuity health improvemet pla (CHIP) ad a departmet strategic pla. There are may frameworks, models, ad tools for CHAs that ca be used idepedetly or i cojuctio with oe aother, icludig the followig: Mobilizig for Actio Through Plaig ad Parterships (MAPP); Plaed Approach to Commuity Health (PATCH); Assessmet Protocol for Excellece i Public Health (APEX PH); Protocol for Assessig Commuity Excellece i Evirometal Health (PACE-EH); ad Natioal Public Health Performace Stadards Program (NPHPSP). Natioal Associatio of Commuity Health Ceters 35

2 Defiig Safety Net Providers: Federally Qualified Health Ceters ad Local Health Departmets Types of Data LHDs Collect ad/or Compile FQHCs should cosider LHDs a resource for commuity health data. I 2008, 88 percet of LHDs i the U.S. reported coductig commuicable/ifectious disease surveillace while 75 percet reported coductig evirometal health surveillace (NACCHO, 2009). LHDs may be resposible for collectig this data for the commuity either o their ow or with parters i the commuity. For example, i may states, those commuicable diseases that are reportable by law are reported to LHDs who the compile, aalyze, ad report this data to state health departmets or federal public health agecies as required. Other evirometal health data, such as elevated blood lead levels i childre or cases of food bore illess, are collected ad aalyzed regularly by LHDs. The types of data each LHD collects, aalyzes, ad reports may differ sigificatly based o the public health laws of the state i which the LHD resides, the LHD s capacity, ad by what other commuity health parters, icludig the state health departmet, are doig. Types of data iclude the followig: Demographic characteristics (e.g., populatio size, populatio distributio by age, icome, geder, race/ethicity); Socioecoomic characteristics (e.g., media icome of the populatio); Health resource availability (e.g., ratio of types of health care providers per capita, umber of hospitals); Morbidity data (e.g., ifectious/commuicable disease data or ijury data); Mortality data (e.g., death rate, primary causes of death); Materal ad child health (e.g., birth rate, ifat mortality rate, percet of preterm births); Behavioral risk data (e.g., adult smokig rate, health care coverage, physical activity rates, adherece to prevetive screeig guidelies); ad Social data (e.g., crime rates, educatio data [high school dropout rate]). I other cases, LHDs may compile this data from other sources ad use it i their ow strategic plaig or to develop a commuity health improvemet pla (CHIP) for their commuity. I either case, most LHDs have access to a variety of public health data ot ecessarily available elsewhere. Natioal Associatio of Commuity Health Ceters 36

Parterships betwee Federally Qualified Health Ceters ad Local Health Departmets 3 The Plaig Process: Layig the Foudatio for a Successful Partership If we are together, othig is impossible. Wisto Churchill Developig FQHC-LHD parterships requires extesive coordiatio, shared kowledge, ope ad clear lies of commuicatio, the commitmet of both parties, ad the establishmet of a shared visio. A. Essetials of a Successful Partership As stated previously, FQHC ad LHD parterships are essetial to improve quality, coserve resources, ad establish a health care medical home. I additio, establishig a partership helps positio both FQHCs ad LHDs to apply for fudig opportuities that may arise uder the health reform law. The buildig blocks to develop a productive ad ogoig partership iclude the followig key elemets: A kowledgeable ad committed stakeholder group; Establishmet of trust; Uderstadig of each orgaizatio s stregths ad limitatios; Establishmet of a clear objective; Uderstadig of the health care eeds ad treds withi the commuity; ad Commitmet to serve the commuity s vulerable populatios. Collaboratio: a mutually beeficial ad well-defied relatioship etered ito by two or more orgaizatios to achieve commo goals. Amherst H. Wilder Foudatio Establishig a Partership To establish a orderly plaig process to idetify, evaluate, ad implemet a partership model, as well as to avoid havig egotiatios break dow because of deal-breakers that could have bee resolved if idetified ad discussed early i the partership process, the FQHC ad LHD are advised to develop ad execute a o-bidig agreemet, which is ofte referred to as a Memoradum of Agreemet. Although the documet is ot legally bidig, it is ofte more effective tha simply implemetig a hadshake agreemet to collaborate. Key topics that may be addressed i the Memoradum of Agreemet iclude, but are ot limited to, the followig: Proposed scope of joit activities; Timelie for evaluatig ad implemetig the partership; Maagemet ad staff members that will be ivolved i the plaig process (i.e., the plaig team ); Cosultats (if ay) to be hired, by which party ad at whose expese; Requiremets that the parties will agree o ay publicity ad/or third party disclosure regardig the collaboratio; Requiremets for disclosure to oe aother of other pertiet egotiatios; ad The parties expectatios fiacial ad otherwise. Natioal Associatio of Commuity Health Ceters 37

3 The Plaig Process: Layig the Foudatio for a Successful Partership To the extet feasible, all commitmets should be mutual, ad must be compliat with applicable laws ad regulatios, icludig, but ot limited to, Sectio 330, its implemetig regulatios, ad related policies. Note: Eve if FQHCs ad LHDs are ot curretly iterested i establishig a partership, they may evertheless wish to establish a process to esure that there is ogoig ad ope commuicatio betwee the orgaizatios. For example, both the FQHC ad LHD may desigate a idividual to meet collectively o a mothly basis to discuss chages i operatios, recet health treds i the commuity, fudig opportuities, ad ay other applicable topic. Questios to Guide the Plaig Process FQHCs ad LHDs may wish to review the followig questios from Himmelma (1996) to aid with the plaig process: 49 Who should be ivolved i the partership? What is the shared visio that motivates the collaboratio? What expectatios does each of the orgaizatios have for oe aother? What is the missio statemet for the partership? What are the short ad log term goals ad objectives? What skills ad resources ca each parter cotribute? How will work get doe to meet goals ad objectives? Who will admiister ad maage the partership? Who will make key decisios? What sources of fudig are required? What additioal sources of fudig may be available? 49 Himmelma, A.T. 1996. O the Theory ad Practice of Trasformatioal Collaboratio: From Social Service to Social Justice. I Creatig Collaborative Advatage, C. Huxham, ed., pp. 16 43. Lodo, Eglad: Sage Publicatios, Ltd. Cofidetiality Agreemet If the FQHC ad LHD are sharig iformatio durig the process of idetifyig ad evaluatig partership opportuities, they should implemet a Cofidetiality Agreemet to protect the uauthorized disclosure ad use of cofidetial ad/or proprietary iformatio that may be exchaged durig the plaig ad egotiatio process. The agreemet should idetify ad broadly defie the cofidetial iformatio to be protected by the agreemet, as well as what kid of iformatio is ot cosidered cofidetial, ad should address the retur of such iformatio (ad all copies) whe the plaig process eds. Buildig Trust: Idetify the purpose for gatherig, assig ad clarify expectatios, establish a reasoable timeframe, let every voice be heard, embrace diversity ad creative ideas, ad craft workig agreemets. Gettig to Kow Your Neighbor Members from both the FQHC ad LHD ca orgaize a retreat or social activity shortly after solidifyig the partership. Egagig i such activity allows each etity to get to kow oe aother, eables ope ad stroger lies of commuicatio, ad allows for a uderstadig of the orgaizatioal makeup of each etity. It may also beefit the partership to pla such activities eve after the partership has existed for a period of time, i order to reaffirm the relatioship, itroduce ew faces, ad stregthe bods. B. Health Iformatio Exchage ad Patiet Privacy Cosideratios Withi a FQHC ad LHD partership, there will be opportuity ad ecessity for health iformatio exchage to help formulate the objectives ad Natioal Associatio of Commuity Health Ceters 38

3 The Plaig Process: Layig the Foudatio for a Successful Partership activities of the collaboratio; to iform commuity eeds assessmets, services, ad programmig; to demostrate value to fuders ad evaluators; to advocate for ew or improved policies ad regulatios; ad to ultimately esure the health ad safety of the commuity. I a ew collaborative system, FQHCs ad LHDs may wat to cosider sharig populatio-based iformatio o the followig: Immuizatios; Screeigs; Disease maagemet; Surveillace; Patiet self-maagemet; Measuremet of cliical performace; Measuremet of service performace; Measuremet of patiet access ad commuicatio; Populatio/commuity health assessmets; ad Cotextual iformatio such as idicators of the determiats of health. This iformatio should be shared usig established stadards, where possible. FQHCs ad LHDs are rich with patiet medical data, but are boud to protect the privacy of patiets uder both state ad federal law. Thus, although this data may be useful to share betwee the two orgaizatios, it is critical to take appropriate steps to esure that ay exchage of protected iformatio is i compliace with applicable privacy laws. What iformatio is protected uder the federal privacy rules? The Privacy Rule uder the Health Isurace Portability ad Accoutability Act of 1996 (HIPAA) establishes a foudatio of federal protectios for the privacy of idividually-idetifiable health iformatio (a.k.a. protected health iformatio (PHI)) that is This guide provides a brief overview of federal law ad regulatio regardig privacy ad cofidetiality requiremets. Privacy ad cofidetiality requiremets also may be foud i state law ad regulatio, icludig laws ad regulatios pertaiig to public health (e.g., HIV status, metal health, ad substace abuse). As such, it is advisable to cosult local kowledgeable cousel to esure compliace. Where state law provisios regardig the privacy of protected health iformatio offer more protectio tha that which is required uder HIPAA, the state law is cotrollig. maitaied or trasmitted i a electroic format. PHI icludes idividually-idetifiable iformatio relatig to idividual medical diagoses, tests, ad treatmets. This iformatio icludes, but is ot limited to, the patiet s ame, address, social security umber, ad health status. 50 The Privacy Rule sets a federal floor regardig patiet privacy. It does ot preempt state laws with stricter stadards, uless a specific exceptio applies. 51 Accordigly, i order to esure compliace, FQHCs ad LHDs must review applicable state laws i additio to HIPAA. The HIPAA Security Rule requires that covered etities, as defied below, implemet admiistrative, physical, techical, ad orgaizatioal safeguards to protect the itegrity, cofidetiality, ad availability of electroic PHI. This icludes establishig appropriate policies ad procedures to gover the creatio, storage, trasmissio, modificatio, ad destructio of electroic PHI. 52 50 DHHS Office of Civil Rights Privacy Brief: Summary of the HIPAA Privacy Rule (May 2003), p. 4. 51 42 U.S.C. 1320d-7 (Sectio 1178 of HIPAA). 52 For more iformatio o the HIPAA Security Rule, see 45 C.F.R. 164 Subparts A ad C. Natioal Associatio of Commuity Health Ceters 39

3 The Plaig Process: Layig the Foudatio for a Successful Partership The Privacy Rule govers the acts of covered etities. Covered etities iclude health plas, health care clearighouses, ad health care providers who furish, bill, or receive paymet for health care i the ormal course of busiess, ad trasmit ay covered trasactios electroically. 53 FQHCs ad LHDs are subject to the Privacy Rule as covered etities if they trasmit ay protected health iformatio regardig a trasactio covered by HIPAA (e.g., claims for paymet, coordiatio of beefits) electroically. 54 What are the permitted uses ad disclosures of data that do ot cotai PHI? FQHCs ad LHDs may share data that does ot cotai PHI or where the PHI has bee de-idetified i compliace with the HIPAA Privacy Rule, provided that the exchage of the iformatio is permitted uder state law. 55 What are the permitted uses ad disclosures of PHI? The Privacy Rule permits a covered etity to use ad disclose a idividual s protected health iformatio for treatmet, paymet, ad health care operatios activities, withi certai, specified limitatios, without obtaiig the idividual s coset. Treatmet is particularly relevat for purposes of this guide. 56 Treatmet is defied as the provisio, coordiatio, or maagemet of health care ad related services by oe or more health care providers, icludig the coordiatio or maagemet of health care by a health care provider with a third party; cosultatio betwee health care providers relatig to a patiet; or the referral of a patiet for health care from oe health care provider to aother. 57 Apart from treatmet, paymet, health care operatios, or disclosures required by law, covered etities geerally must obtai a patiet s writte coset to use or disclose PHI. The Privacy Rule permits, but does ot require, a covered etity to disclose PHI for certai public health purposes without a idividual s authorizatio. 58 Geerally, the rule permits covered etities to disclose PHI to public health authorities that are legally authorized to receive such iformatio for the purposes of prevetig or cotrollig disease, ijury, or disability. 59 Whe must a covered etity obtai a patiet s writte authorizatio to use ad disclose PHI? The HIPAA Privacy Rule requires a covered etity to obtai a writte authorizatio from a idividual who is the subject of the protected health iformatio, or the idividual s persoal represetative, before releasig ay PHI for ay purpose that is ot explicitly exempt from the Privacy Rule. Valid authorizatios must be i writig, describe the iformatio to be disclosed, ad, amog other thigs, iclude certai required statemets set forth i the Privacy Rule. See Appedix A for a sample authorizatio form that ca be adapted for use i the covered etity s practice. A idividual s treatmet may ot be coditioed o the sigig of a authorizatio except where the treatmet is research-related ad the authorizatio is for disclosure for the research-related purpose. 60 53 45 C.F.R. 160.103. 54 42 C.F.R. 160.103 (defiig covered trasactio ). 55 45 C.F.R. 160.103 ad 164.514. 56 45 C.F.R. 164.506(c). 57 45 C.F.R. 164.501. 58 45 C.F.R. 164.512. 59 Covered etities may also eter ito data use agreemets i order to share limited data sets. For more iformatio o this optio for data sharig, see 45 C.F.R. 164.514(e). 60 45 C.F.R. 164.508(b)(4). Natioal Associatio of Commuity Health Ceters 40

Parterships betwee Federally Qualified Health Ceters ad Local Health Departmets 4 Federally Qualified Health Ceter-Local Health Departmet Partership Models Today, the two cultures medicie ad public health seem to live i differet, ofte ufriedly worlds. This was ot always the case. Experieces with uiversities, health departmets, ad govermets durig four decades have coviced me that cotiued separatio of the two eterprises greatly dimiishes their combied scietific, orgaizatioal ad istitutioal potetials. Kerr L. White, Healig the Schism: Epidemiology, Medicie, ad the Public s Health, 1991 Key Partership Models This guide focuses exclusively o the followig three partership models: A. Oe orgaizatio refers its patiets to the other orgaizatio for services (i.e., a Referral Arragemet) B. Oe orgaizatio co-locates to the other orgaizatio s facility (i.e., a Co-Locatio Arragemet) C. FQHC purchases services ad/or capacity from the LHD (i.e., a Purchase of Services Arragemet) Selectig a partership model is a strategic decisio. Every partership will vary depedig o the specific goals of the FQHC ad LHD, a commuity s health care eeds, ad the orgaizatioal structure of both the FQHC ad LHD. It is importat to ote that there are umerous potetial partership models i which the orgaizatios may egage that are ot discussed i this guide (icludig models ivolvig greater levels of itegratio). Several pertiet Sectio 330 grat-related requiremets are summarized i Chapter 2 of this guide, ad should be reviewed prior to implemet- ig ay partership. It is importat to ote, however, that this guide does ot provide a comprehesive review of applicable federal laws, ad does ot address state law cosideratios. Accordigly, FQHCs ad LHDs are strogly advised to seek the assistace of qualified local legal cousel ad other appropriate professioal advisors whe evaluatig ad implemetig parterships. Must the partership be documeted i the form of a writte agreemet? A writte agreemet is critical to demostrate compliace with various federal (ad ofte state) laws ad regulatios, ad helps to articulate roles ad resposibilities for both the FQHC ad LHD. Furthermore, the Health Resources ad Services Admiistratio (HRSA), the federal agecy that oversees the FQHC program, geerally requires evidece of FQHC affiliatio relatioships as part of all grat applicatios (i.e., New Access Poit, Expaded Medical Capacity, Service Expasio), for desigatio as a FQHC, ad for purposes of icludig the services provided uder the agreemet withi the FQHC s approved scope of project. Natioal Associatio of Commuity Health Ceters 41

4 Federally Qualified Health Ceter-Local Health Departmet Partership Models A. Referral Arragemet A referral arragemet is a partership uder which a provider agrees to furish services to those patiets who are referred to it by aother provider. The provider referrig the patiet typically agrees to utilize the other provider as its preferred, albeit ot exclusive, provider of choice for particular services. For purposes of this guide, the orgaizatio referrig the patiet is referred to as the Referrig Orgaizatio, ad the orgaizatio providig the referral services is referred to as the Referral Provider. Uder a referral arragemet, both the FQHC ad the LHD retai their ow separate ad distict patiet care delivery systems ad locatios, ad each is oly accoutable ad legally ad fiacially resposible for the services it directly furishes to patiets. A referral arragemet may serve as a useful precursor to a more collaborative relatioship, providig both the FQHC ad LHD with a opportuity to become familiar with the other orgaizatio before implemetig a more itegrated partership. The mai tool by which the parties would implemet this arragemet is a Referral Agreemet, executed by both the FQHC ad LHD. Key Referral Arragemet Cosideratios Scope of Project Uder a referral arragemet, both the FQHC ad the LHD typically cotiue to perform the same scope of services. All services provided withi a FQHC s scope of project via referral to aother provider must be provided through a formal referral arragemet. Uder a formal referral arragemet, the FQHC maitais resposibility for the patiet s overall treatmet pla ad provides ad/or pays/bills for appropriate follow-up care based o the outcome of the referral. It is also importat to ote that such services must be equally available to all of the FQHC s patiets, regardless of their ability to pay ad i accordace with a schedule of discouts, as described o pages 17 18. As described below, these referral arragemets should be formally documeted i a writte agreemet that, at a miimum, describes the maer by which the referral will be made ad maaged ad the process for referrig back to the FQHC for appropriate follow-up care. Uder formal referral arragemets, if the actual service is provided ad paid/billed for by aother etity, the the service is ot icluded i the FQHC s scope of project. However, establishmet of the referral arragemet ad ay follow-up care provided by the FQHC subsequet to the referral is cosidered to be part of the FQHC s scope of project. Formal referral arragemets are icluded i a FQHC s Form 5-Part A, Colum III. 61 Addig a service icluded o Form 5-Part A, albeit by formal referral arragemet, requires prior approval from HRSA. 62 Uder a iformal referral arragemet, which caot be used to provide required or other i-scope services, the FQHC refers a patiet to aother provider who is resposible for the overall treatmet pla ad billig for the services provided ad o grat fuds are used to pay for the care provided. These iformal arragemets are ot required by HRSA to be documeted i a writte agreemet ad do ot require the other provider to refer patiets back to the FQHC for appropriate follow-up care. For services provided by iformal referral arragemets, the referral arragemet ad the service ad ay follow-up care provided by the other etity, are cosidered outside of the 61 HRSA PIN 2008-01: Defiig Scope of Project ad Policy for Requestig Chages, p. 11 available at http://bphc.hrsa.gov/policy/pi0801/. 62 HRSA PIN 2008-01, p.16. Natioal Associatio of Commuity Health Ceters 42

4 Federally Qualified Health Ceter-Local Health Departmet Partership Models FQHC s scope of project ad are ot captured o Form 5-Part A. 63 Accordigly, it is ot required that a FQHC obtai HRSA s prior approval to add a iformal referral arragemet. Referral Methodology The LHD ad FQHC should develop a protocol describig the maer i which the referrals betwee the LHD ad FQHC would be made ad processed. For example, referrals could be made i writig, over the telephoe, or through electroic meas. If the LHD is the Referral Provider ad provides a required FQHC service or aother service which the FQHC icludes i its approved scope of project, the the FQHC ad LHD must have a mechaism i place to esure that patiets have actual access to, ad follow through o, the referrals, such as patiet trackig ad case maagemet services. For example, if the FQHC is the Referrig Orgaizatio ad the LHD is the Referral Provider, the FQHC could assist the patiet i makig his/her appoitmet with the LHD ad could fuctio as the coordiator to esure that the patiet presets at the LHD (ad, as appropriate, presets back at the FQHC). By assistig the patiet i makig the appoitmet, certai barriers to access ca be elimiated or miimized. I additio, i order to support patiet trackig, the FQHC ad LHD should determie how to idetify shared patiets i their patiet records. Although the above referral methodology cosideratios are oly required for services that are withi the FQHC s scope of project, they are evertheless recommeded practices for all referral relatioships. Fees ad Discouts If the FQHC is the Referral Provider, it must charge the patiets referred by the LHD i accordace with the FQHC S fee schedule ad schedule of discouts, as described o pages 17 18. I additio, the FQHC is statutorily obligated to serve all patiets referred by the LHD, regardless of ability to pay, subject to reasoable capacity limitatios. If the LHD is the Referral Provider ad provides a required FQHC service (e.g., detal) or aother service which the FQHC icludes i its approved scope of project, the the LHD must make such services available to all FQHC patiets, regardless of ability to pay, ad must establish a schedule of discouts for patiets uder 200% of the Federal Poverty Level. 64 Uder certai scearios, the FQHC may agree to provide fiacial support to the LHD for the reasoable costs it icurs i providig the referral services to the referred FQHC patiets that are uisured or uderisured. Fiacial Systems The FQHC ad LHD each maitai separate fiacial systems. The billig ad codig fuctios of the orgaizatios remai o-itegrated, ad each orgaizatio bills payors ad patiets, as appropriate, for the services it provides. Provider Capacity Uder the referral arragemet, the FQHC ad the LHD maitai their ow employees ad cotractors. Further, the credetialig requiremets, bylaws ad cliical policies of the orgaizatio providig services gover. I geeral, prior to referrig a patiet to or eterig ito a referral arragemet, the FQHC ad LHD should perform due diligece to esure that the Referral Provider has capacity to see additioal 63 HRSA PIN 2008-01, p.11. 64 HRSA PIN 2008-01, p.11. Natioal Associatio of Commuity Health Ceters 43

4 Federally Qualified Health Ceter-Local Health Departmet Partership Models patiets. The FQHC ad LHD should also cosider traiig both orgaizatios health care professioals regardig the referral process, the process for sharig medical records, ad ay special liguistic ad cultural eeds of the patiets. Medical Records Uder the referral arragemet, the LHD ad the FQHC each maitai their ow complete medical records ad oly share referral records ad otes for purposes of treatmet. As such, the Referral Agreemet should iclude provisios clarifyig what types of iformatio may be shared ad how this sharig process will occur (as well as ay limitatios o the sharig of iformatio). Federal Tort Claims Act FTCA coverage is available to the FQHC if it is the Referral Provider ad if the arragemet otherwise satisfies the FTCA requiremets (see pages 20 22). FTCA coverage is ot available for the LHD or its cotracted or employed health care professioals, regardless of whether the LHD is the Referrig Orgaizatio or the Referral Provider. Sectio 340B Prescriptio Drugs As stated o page 22, drugs purchased uder the Sectio 340B prescriptio drug program may be dispesed oly to the FQHC s patiets. If prescriptios are writte by a LHD health care professioal ad the patiet presets back at the FQHC to have them filled, the FQHC may be able to fill the prescriptio usig Sectio 340B prescriptio drugs if the patiet qualifies as a patiet of the FQHC uder the Sectio 340B defiitio of patiet, ad the FQHC maitais a active, primary role for moitorig ad maagig the patiet s particular course of treatmet. The fact that the referral to the LHD origiated at the FQHC does ot trigger the ability to use Sectio 340B prescriptio drugs for that patiet. Uder o circumstaces may the FQHC rewrite the LHD health care professioal s prescriptio. Exclusive Referral Relatioships HRSA has voiced cocer regardig exclusive arragemets that do ot provide FQHCs with leeway to develop ay ad all referral ad/or collaborative relatioships ecessary to provide the full cotiuum of care ad to meet all statutory ad regulatory requiremets ad policy expectatios regardig coordiatio ad collaboratio with other providers. HRSA prefers that FQHCs maitai the freedom to eter ito other arragemets as ecessary (1) to implemet the policies ad procedures established by the FQHC s board of directors, ad (2) to assure appropriate collaboratio with other local health care providers 65 to ehace patiet freedom of choice, accessibility, availability, quality ad comprehesiveess of care. 66 As such, the Referral Agreemet should ot foreclose either party from eterig ito arragemets with other providers, whether for the same or for similar services, if such party deems it ecessary. Key Terms of a Referral Agreemet: Note that although writte agreemets are oly required i the cotext of formal referral arragemets, as described o page 42, we suggest that FQHCs ad LHDs also execute such agreemets to implemet iformal referral arragemets. All Referral Agreemets should iclude, at a miimum, the followig terms: 65 42 U.S.C. 254b(k)(3)(B). 66 HRSA s positio regardig the limitatios o a FQHC s ability to form relatioships with other providers is addressed i HRSA PIN 97-27: Affiliatio Agreemets of Commuity ad Migrat Health Ceters available at http://bphc.hrsa.gov/policy/pi9727.htm. Natioal Associatio of Commuity Health Ceters 44

4 Federally Qualified Health Ceter-Local Health Departmet Partership Models The Referrig Orgaizatio will ot be liable for ay damages arisig from ay acts or omissios i coectio with the services provided uder the referral arragemet by the Referral Provider. The Referrig Orgaizatio does ot guaratee that it will make referrals to the Referral Provider, whether by committig to a specific umber or a miimum level of referrals. Nothig i the arragemet will, or is iteded to, impair the exercise of professioal judgmet by ay ad all health care professioals employed by or cotracted to either party whe makig referrals. Nothig i the arragemet will, or is iteded to, impair the exercise of freedom of choice of provider by ay ad all patiets served by each party. Both the FQHC ad LHD maitai the right to eter ito arragemets with other providers, whether for the same or for similar services. The FQHC ad LHD agree to comply with ay federal or state law goverig the privacy ad cofidetiality of the idividually idetifiable health iformatio of patiets origiatig with either party. The Referral Provider will furish all services cosistet with the prevailig stadard of care ad will be solely liable for all services provided by it ad its health care professioals. If the Referral Agreemet is for a formal referral arragemet whereby the FQHC is the Referrig Orgaizatio ad the LHD is the Referral Provider, the Referral Agreemet must also: Describe the maer by which the referral will be made ad maaged ad the process for referrig back to the FQHC for appropriate follow-up care. The LHD agrees to accept all FQHC patiets referred to it by the Referrig Orgaizatio, regardless of ability to pay, subject to reasoable capacity limitatios. The LHD agrees to offer the referral services o a slidig fee scale. The LHD agrees that the health care professioals providig the referral services are properly credetialed ad licesed to perform the activities ad procedures expected of them by the FQHC. The Referral Agreemet must also describe the maer by which the referral will be made ad maaged (e.g., developmet of a referral protocol ad procedures for trackig patiets ad esurig appropriate follow-up care) ad the process for referrig the patiet back to the FQHC for follow-up care. It is recommeded that the Referral Agreemet also describe the divisio of services betwee the Referrig Orgaizatio ad the Referral Provider (e.g., idetify which orgaizatio will make appoitmets). B. Co-Locatio Arragemets Similar to the stadard referral arragemet, a colocatio arragemet is a partership uder which a provider agrees to treat patiets who are referred to it by aother provider, maitais its ow practice ad cotrol over the provisio of the referral services, ad is legally ad fiacially resposible for the referral services. However, ulike the referral arragemet, the health care professioal furishig the referral services is physically located at the other orgaizatio s site, either o a full or part-time basis. Natioal Associatio of Commuity Health Ceters 45

4 Federally Qualified Health Ceter-Local Health Departmet Partership Models As described i the Distiguishig Providers sectio below, it is advisable to distiguish betwee the FQHC ad LHD health care professioals. It is importat to ote that, depedig o how the relatioship is structured, it may be ecessary that the FQHC ad LHD have separate etraces i order to obtai a separate Medicare site certificatio. 67 FQHCs ad LHDs are also advised to review state law for ay requiremets regardig providers sharig cliical space. Patiet access may be sigificatly icreased uder this arragemet because co-locatio reduces trasportatio barriers ad may allow patiets to obtai services from both the FQHC ad LHD i oe visit. The mai tool by which the parties would implemet this arragemet is a Co-Locatio Agreemet, executed by both the FQHC ad LHD. Although this sectio specifically addresses co-locatio withi oe facility, it is importat to ote that the key cosideratios ad terms outlied below (other tha Distiguishig Providers ad Lease of Space ad Equipmet ) are applicable to arragemets whereby oe orgaizatio establishes a ew site ext to or otherwise earby the other orgaizatio. Although these close proximity arragemets do ot provide for the level of coordiated services available uder the traditioal co-locatio arragemet, they evertheless reduce trasportatio barriers ad icrease access. Key Co-Locatio Arragemet Cosideratios Scope of Project Cosideratios Sites If the LHD establishes a site withi the FQHC, the FQHC is ot required to chage its approved scope of project because it is ot addig or removig a site. Patiets are simply referred to the LHD as they would be uder the stadard referral relatioship. If the FQHC establishes a site withi the LHD, the FQHC must obtai prior approval from HRSA to add the site to its scope of project. Prior to seekig HRSA approval to add a ew site to a FQHC s scope of project, a FQHC must cosider whether the locatio qualifies as a FQHC site (see page 24). It is importat to ote that the locatio will oly qualify as a site if the FQHC provides services at the co-located locatio o a regularly scheduled basis. For iformatio regardig scope of project chage requiremets, see pages 25 26. Services As stated o page 42, if the co-locatio icludes a formal referral arragemet that will be icluded i the FQHC s Form 5-Part A, ad therefore i the FQHC s scope of project, the the FQHC must receive HRSA s prior approval. 68 Distiguishig Providers To avoid uiteded legal liabilities, the co-located provider should be clearly idetified as a provider furishig services separate from the other orgaizatio. I additio, it should be clear that the colocated health care professioal(s) is ot employed by, or cotracted to, the other orgaizatio. For example, if the LHD co-locates at a FQHC site, ad a patiet believes oe of the LHD health care professioals violated a duty ad provided substadard care that harmed the patiet, the patiet would likely sue both the LHD ad the FQHC. Uless it was clear to the patiet at the time services 67 42 C.F.R. 491.8. 68 HRSA PIN 2008-01, p.11. Natioal Associatio of Commuity Health Ceters 46

4 Federally Qualified Health Ceter-Local Health Departmet Partership Models were redered that the health care professioal(s) was employed by or cotracted to the LHD, that the LHD is a legal etity separate from the FQHC, ad that the services i questio were provided i the LHD health care professioal s capacity as a separate provider, should a jury fid for the patiet, the FQHC might be held legally liable as well (of course, this would deped o the facts of the situatio ad how the patiet s legal claim was drafted, but cautio is always advisable). Accordigly, there should be separate etraces for the co-located FQHC ad LHD, if possible, ad very clear sigage i multiple places, icludig the waitig room, the billig area, ad the room where the co-located provider s services will be provided, as well as brochures ad pamphlets placed throughout the area. Further, the FQHC ad LHD may agree o the placemet of exteral sigage idetifyig the co-located provider. 69 I additio to sigage ad materials, both orgaizatio s health care professioals, as they explai the referral process to the patiet, may also cosider explaiig that the FQHC ad LHD are separate, but housed i the same place for patiets coveiece. Lease of Space ad/or Equipmet The FQHC ad LHD should execute a lease coverig the actual space, equipmet, utilities, supplies, ad support persoel that will be utilized by the co-located provider, as well as other associated costs icurred by the co-located provider i furishig services at the other orgaizatio s facility. For example, the co-located provider may eed use of a exam or coferece room, access to a computer, phoe, fax machie, ad copier. The lease provisios may be icluded withi the Co-Locatio Agreemet or as a separate agreemet. The space, equipmet, utilities, supplies, ad support persoel should be leased by the co-located provider based o a fair market, arm s legth egotiated rate, uless the FQHC is the purchaser ad the parties structure the arragemet to comport with the FQHC safe harbor uder the Ati- Kickback statute (see page 23). Referral Methodology As with the stadard referral relatioship, if the LHD is the Referral Provider ad provides a required FQHC service (e.g., detal or aother services which the FQHC icludes i its approved scope of project), the the FQHC ad LHD must develop a protocol describig the maer i which the referrals betwee the two providers would be made ad processed ad a mechaism i place to esure that patiets have actual access to, ad follow through o, the referrals, such as patiet trackig ad case maagemet services. Note that the FQHC ad LHD must develop a referral protocol if, uder the referral arragemet, the LHD provides the FQHC patiets with services withi the FQHC s scope of project. The appoitmets could occur o the spot, so that the patiet would be able to preset directly to the co-located provider at the time that a eed for services is idetified (assumig the co-located provider s schedule permitted). Alteratively, a case maager or coordiator could make the referral appoitmet with the co-located provider, based upo both the patiet s ad the co-located provider s schedule. I additio, i order to support patiet trackig, the FQHC ad LHD should determie how to idetify shared patiets i their patiet records. 69 It is importat to ote that depedig o the FQHC patiet populatio, liguistic ad cultural competecy, as well as literacy, may be a issue ad, as such, all sigage ad materials should be available i the prevalet laguages spoke by, ad at the appropriate grade-level of, the patiet populatios. Natioal Associatio of Commuity Health Ceters 47

4 Federally Qualified Health Ceter-Local Health Departmet Partership Models Provider Capacity Provider capacity cosideratios uder the co-locatio arragemet mirror those addressed uder the referral arragemet, as described o page 43. However, there are additioal cosideratios because the health care professioal(s) will be co-located i the other facility. Specifically, the Co-Locatio Agreemet should cotai certai assuraces from the co-located provider regardig the professioal qualificatios, licesure, certificatio, isurace, eligibility to participate i federal programs, etc. with regard to the other orgaizatio ad its health care professioals who will be providig the services. I additio, the orgaizatio that houses the co-located provider may wat to retai the right to request the removal of ay co-located health care professioal who fails to meet ecessary qualificatios or who could jeopardize the health, safety ad welfare of patiets if he or she cotiues to provide services at the co-located site. Federal Tort Claims Act As stated o page 21, FTCA coverage is available for deemed FQHCs, its employees, ad certai cotracted providers for services provided withi the FQHC s scope of project. Accordigly, if the FQHC co-locates to a LHD facility, adds the site to its scope of project, ad provides services withi its scope of project, FTCA coverage is geerally available for the FQHC, its employees, ad certai cotracted providers. Uder the co-locatio arragemet, FTCA coverage is ot available for the LHD, its employees ad its cotracted health care professioals. The LHD would eed to obtai ad carry its ow professioal liability isurace. Referral Provider Fees ad Discouts, Fiacial Systems, Medical Records, Sectio 340B Prescriptio Drugs ad Exclusive Referral Relatioships As stated above, the co-locatio arragemet is a form of referral relatioship. The FQHC ad the LHD retai their ow separate ad distict patiet care delivery systems despite the shared space. Accordigly, for more iformatio regardig fees ad discouts, the FQHC s ad LHD s fiacial systems, Sectio 340B prescriptio drugs ad exclusive referral relatioships, readers should refer to the applicable headigs uder the Key Referral Arragemet Cosideratios o pages 43 44. Key Terms of a Co-Locatio Agreemet Because a co-locatio arragemet is a form of referral relatioship, the Co-Locatio Agreemet should iclude the key terms listed for Referral Agreemets (see pages 44-45). If applicable, the FQHC ad LHD may wish to iclude terms regardig the lease of certai space, equipmet, supplies, utilities, ad support ad clerical staff to assist the co-located provider, which should be leased by the co-located provider based o a fair market, arm s legth egotiated rate, uless, as stated above, the FQHC is the purchaser ad the FQHC ad LHD wish to structure the arragemet i accordace with the FQHC safe harbor to the Ati-Kickback statute (see page 23). C. Purchase of Services Arragemets Uder the purchase of services arragemet, oe orgaizatio purchases services from the other orgaizatio, which provides such services as a vedor ad o behalf of the other purchasig orgaizatio. Although this guide exclusively addresses the purchase of health care professioal services, it is importat to ote that FQHCs ad LHDs may eter ito arragemets for the purchase of admiistrative services. Natioal Associatio of Commuity Health Ceters 48

4 Federally Qualified Health Ceter-Local Health Departmet Partership Models The purchasig orgaizatio is the provider of record for the cotracted services redered to its patiets, maitais cotrol over the provisio of such services, ad remais legally ad fially resposible for the services provided by the cotracted provider. The services provided by the vedor orgaizatio may be provided at either the purchasig orgaizatio s facility or at the vedor orgaizatio s facility. It is importat to ote, however, that the FQHC ad LHD still remai separate etities uder this arragemet. This guide oly addresses the arragemet whereby a FQHC purchases services from a LHD. Although the alterative model (i.e., LHD purchases services from a FQHC) is feasible, it is difficult to summarize the key cosideratios because LHDs are etities with govermetal authority, ad are therefore subject to local ad state procuremet requiremets that vary extesively across the coutry. I additio, purchasig services from a FQHC does ot maximize resources. Specifically, if a FQHC provider is cotracted from aother orgaizatio, the FQHC beefits (amely FTCA, Sectio 340B prescriptio drugs, ad cost-based reimbursemet uder Medicare, Medicaid ad CHIP) are ot available for that provisio of services. The mai tool by which the parties would implemet this arragemet is a Purchase of Services Agreemet, executed by both the FQHC ad LHD (or the idividual LHD provider). Note: Muicipal statutes may limit a LHD s authority to cotract with private or public orgaizatios to provide services. Accordigly, it is critical that the parties review local ad state laws whe determiig whether it is permissible to cotract with the LHD or directly with the LHD provider(s). Key Features of the Purchase of Services Arragemet Scope of Project Cosideratios If the service(s) provided to the FQHC s patiets by the cotracted LHD health care professioal(s) are ot curretly withi the FQHC s scope of project, the the FQHC must request ad obtai prior approval from HRSA to add the service(s) to its scope of project. I additio, if it is aticipated that the cotracted services will be furished to FQHC patiets at a site that is ot curretly withi the FQHC s scope of project, the the FQHC must cofirm that the locatio qualifies as a site (e.g., services are provided o a regularly scheduled basis, see pages 24 25 for more iformatio), ad must accordigly request ad obtai prior approval from HRSA to add the site to its scope of project. The process for applyig for a chage i scope of project is described o pages 25 26. Compesatio for Services The FQHC compesates the LHD for the provisio of services based o a fair market, arm s legth egotiated rate, which should be icorporated, alog with the specific paymet methodology, ito the writte cotract. Note that a fair market value rate may ot be ecessary if the FQHC is the purchaser ad the parties structure the arragemet to comport with the FQHC safe harbor uder the Ati-Kickback statute (see page 23). Reimbursemet from Payors ad Patiets The patiets served uder this arragemet would be cosidered FQHC patiets for all services provided ad, as such, the FQHC (ad ot the LHD health care professioal) would bill appropriate third party payors ad, as applicable, collect fees from patiets. Natioal Associatio of Commuity Health Ceters 49

4 Federally Qualified Health Ceter-Local Health Departmet Partership Models Health Care Professioals Because the LHD health care professioal is furishig services to FQHC patiets o behalf of the FQHC, the LHD health care professioal should receive relevat traiig regardig the applicable laws, regulatios, ad FQHC cliical policies, procedures, stadards, ad protocols that gover the provisio of services to FQHC patiets. Further, the LHD health care professioal should receive traiig i other areas relevat to the provisio of services, icludig, but ot limited to, the FQHC s employmet-related policies, cultural ad liguistic competecy, ad the FQHC s corporate compliace program ad HIPAA-related policies. Assuraces ad Oversight As described i the key terms sectio below, the Purchase of Services Agreemet should iclude provisios to esure that the LHD health care professioal provides services to the FQHC patiets i the same maer as if the FQHC was providig such services directly. Further, the Purchase of Services Agreemet should iclude provisios uder which the FQHC maitais certai rights i order to fulfill its oversight resposibilities, icludig approval of all LHD health care professioals assiged to the FQHC; evaluatio of performace; compliace with policies, procedures, stadards, ad protocols; ad, as ecessary, termiatio or suspesio of idividual health care professioals. Procuremet Stadards Prior to eterig ito a arragemet ivolvig a grat-supported purchase of goods ad/or services from a LHD, a FQHC should esure that the purchase complies with a procuremet process desiged to assure that the FQHC obtais the best quality goods ad services at the lowest possible cost. The procuremet process must satisfy the requiremets set forth i the federal procuremet stadards, 45 C.F.R. Part 74, as described briefly o page 18. Medicare/Medicaid Issues Whether a visit to see the cotracted LHD health care professioal ad a primary care visit that occurred o the same day ca be billed as separate visits will deped largely o whether the state has promulgated applicable limitatios. It is advisable that FQHCs ad LHDs request a opiio from their Medicaid Departmet to determie whether state law precludes reimbursemet for two or more services that are performed by differet providers, eve though the secod provider is performig services o behalf of the first. I additio, state law may preclude or limit the ability of the FQHC to bill Medicaid for services furished by the LHD health care professioal to FQHC patiets, eve whe such services would be provided o behalf of (ad uder the cotrol of) the FQHC. Alteratively, state law may allow the FQHC to bill such services, but ot as FQHC services eligible for cost-based reimbursemet. As such, it is advisable to review state law ad, if such review idicates that there will be (or might be) a issue uder state law pertaiig to the structure of this arragemet, to request a opiio letter from the appropriate state agecy approvig the arragemet prior to implemetatio. Medical Records Isofar as the LHD health care professioal is furishig services to FQHC patiets, o behalf of the FQHC, pursuat to a Purchase of Services Agreemet, the FQHC would maitai resposibility ad owership for all patiet records developed i coectio with such services. Of course, the FQHC would still be Natioal Associatio of Commuity Health Ceters 50

4 Federally Qualified Health Ceter-Local Health Departmet Partership Models boud to the same requiremets ad restrictios for a health care provider uder HIPAA ad FQHC regulatios, as well as correspodig state regulatios. FTCA Cosideratios As oted o page 21, for cliical capacity purchase arragemets to be eligible for FTCA coverage, the agreemet must, at a miimum, be directly betwee the FQHC ad the idividual health professioal providig services to the FQHC s patiets. A agreemet betwee the FQHC ad a LHD will ot exted FTCA coverage to the idividual health professioal who is a LHD employee. Accordigly, uder such arragemets the LHD should obtai ad carry professioal liability isurace for both itself ad its cotracted provider. Sectio 340B Prescriptio Drugs As stated o page 22, drugs purchased uder the Sectio 340B program may be dispesed oly to idividuals that qualify as patiets of the FQHC, i accordace with the Sectio 340B defiitio of patiets. Uder the purchase of services arragemet, patiets see by LHD providers are see uder the auspices of the FQHC. Techically, there is ot a referral back to the FQHC for primary ad prevetive care because all services are techically provided by the FQHC. Ulike referral relatioships or co-locatio arragemets, the FQHC maitais cotrol for the patiet s care at all times ad, as such, Sectio 340B drugs may be utilized. Exclusive Purchase Relatioships As stated o page 44, HRSA has voiced cocer regardig exclusive arragemets. As such, the Purchase of Services Agreemet should ot foreclose either party from eterig ito arragemets with other providers, whether for the same or for similar services. Key Terms of a Purchase of Services Agreemet If the FQHC purchases capacity from the LHD, the followig terms should be icluded i the Purchase of Services Agreemet. While these terms provide a geeral overview of key provisios, the specifics of each agreemet will vary based o the particular affiliatio arragemet. All patiets receivig services from cotracted providers will be registered as patiets of the FQHC; the FQHC will be solely resposible for the billig of services redered to such patiets, as well as third party payors (icludig Medicaid ad Medicare), ad the collectio ad retetio of ay ad all paymets due. The FQHC will: Maitai resposibility ad authority for approvig, moitorig, evaluatig, ad, as ecessary, suspedig or removig cotracted health care professioals from providig services to FQHC patiets. Pay a fair fee based o arm s legth egotiatio for services redered by cotracted LHD staff, uless the parties structure the arragemet to comport with the FQHC safe harbor uder the Ati-Kickback statute (see page 23). The LHD will be resposible, as the employer of the cotracted health care professioals, for securig ad maitaiig Worker s Compesatio ad comprehesive geeral ad professioal liability isurace for the cotracted providers, uless such health care professioals are directly cotracted to the FQHC ad are eligible for FTCA coverage. Natioal Associatio of Commuity Health Ceters 51

4 Federally Qualified Health Ceter-Local Health Departmet Partership Models The LHD health care professioal(s) will: Nothig i the arragemet will, or is iteded Provide cliical services to patiets o be- to, impair the exercise of professioal judg- half of the FQHC. met by ay ad all health care professio- Provide services cosistet with the FQHC s als employed by or cotracted to either party Sectio 330 grat (or FQHC project re- whe makig referrals. quiremets) ad applicable health care ad persoel policies, procedures, stadards ad protocols, ad uder the directio of the FQHC s maagemet team. Satisfy the FQHC s licesure, credetialig Nothig i the arragemet will, or is iteded to, impair the exercise of freedom of choice of provider by ay ad all patiets served by each party. ad other professioal qualificatios re- Each party maitais the right to eter ito ar- quiremets. ragemets with other providers, whether for Be ad remai eligible to participate i the same or for similar services, if such party federal health care programs, icludig the deems it ecessary. Medicaid ad Medicare programs. Not be debarred/suspeded from participatig i federal cotracts. Develop, maitai ad furish programmatic reports ad records, as required by the FQHC. Prepare medical records cosistet with the FQHC s stadards (which records will be the property of FQHC); ad If the FQHC is a Sectio 330 gratee, ay agreemet to purchase cliical capacity will eed to iclude certai provisios cosistet with 45 C.F.R. Part 74. I short, these provisios address remedies i the evet of cotractor breach, record keepig obligatios, ad compliace with various federal laws ad regulatios. Comply with ay federal or state law goverig the privacy ad cofidetiality of the idividually idetifiable health iformatio of the FQHC s patiets. Natioal Associatio of Commuity Health Ceters 52

Parterships betwee Federally Qualified Health Ceters ad Local Health Departmets 5 Additioal Legal Cosideratios There are additioal legal issues that should be addressed i structurig FQHC-LHD parterships. The types of legal issues deped o the ature ad complexity of the partership. I particular, FQHCs ad LHDs may eed to review the followig to esure compliace with applicable laws, regulatios, ad policies: Federal tax cosideratios (Iteral Reveue Code); Federal fraud ad abuse law (e.g., atikickback, false claims); Federal physicia self-referral law (Stark); Federal Atitrust law; Health Isurace Portability ad Accoutability Act; ad DHHS Uiform Admiistrative Requiremets (45 C.F.R. Part 74). Cliic licesure ad certificate of eed laws; Professioal licesure, certificatio ad/or other authorizatio to reder services; Zoig laws; Corporatio/LLC statutes; Privacy of patiet health iformatio; Isurace; ad Scope of practice (icludig supervisio requiremets for particular providers). We strogly cautio both FQHCs ad LHDs to seek the assistace of qualified legal cousel ad other appropriate professioal advisors whe: Developig ad/or evaluatig particular partership optios; ad Coductig due diligece reviews ad draftig or reviewig defiitive agreemets. FQHCs ad LHDs should also be aware of state ad local law requiremets that may affect a particular partership. These laws may iclude, but are ot limited to: State couterparts to federal laws, icludig fraud, abuse, ad physicia self-referral; Natioal Associatio of Commuity Health Ceters 53

Parterships betwee Federally Qualified Health Ceters ad Local Health Departmets 6 Coclusio ad Next Steps While formig a FQHC-LHD partership ca ivolve complex legal issues ad limitatios, experiece has demostrated that the beefits to creatig a commuity system of care may be well worth the effort. As a iitial step, the FQHC ad LHD should: 1. Secure commuity support ad leadership to implemet the partership. 2. Establish measures to evaluate the partership ad its impact o the commuity. 3. Evaluate commuity eeds. 4. Clearly defie their goals ad objectives for eterig ito a partership, with careful cosideratio of the Patiet Protectio ad Affordable Care Act, regulatios for Meaigful Use of Health Iformatio Techology, ad the stadards of the patiet-cetered medical home. 5. Carefully cosider ad determie the appropriate partership to achieve the FQHC s ad LHD s idetified goals ad objectives. 6. Esure that the partership is fiacially feasible ad beeficial. To esure that all issues ad cosideratios are well thought-out ad measured, the FQHC ad LHD should egage i a deliberative, step-by-step process to pla, egotiate, ad establish the chose partership approach. Fially, the FQHC ad LHD must cosider all legal ad policy requiremets ad ramificatios related to establishig the partership, to esure ot oly smooth implemetatio, but also a successful future. Cocludig Tips Celebrate achievemets. Foster a eviromet that welcomes ew ideas. Focus o the shared missio to improve public health ad primary care. Natioal Associatio of Commuity Health Ceters 54

Parterships betwee Federally Qualified Health Ceters ad Local Health Departmets Appedix A Useful Resources Orgaizatios Feldesma Tucker Lefier Fidell LLP (FTLF) is a law firm located i Washigto, DC, that has a extesive, atioal health law practice represetig commuity-based health care providers. Cliets iclude, but are ot limited to, federally qualified health ceters (FQHCs), hospitals, health systems, ad state primary care associatios that have as their missio the improvemet of access to highquality, cost-effective health care services to medically uderserved ad vulerable populatios. FTLF is also cousel to the Natioal Associatio of Commuity Health Ceters. www.ftlf.com Natioal Associatio of Commuity Health Ceters (NACHC) is the trade associatio for health ceters atiowide ad is dedicated exclusively to expadig health care access for America s medically uderserved through the Commuity Health Ceter model. www.achc.com Natioal Associatio of Couty ad City Health Officials (NACCHO) is the atioal orgaizatio represetig local health departmets. NACCHO s visio is: health, equity, ad well-beig for all people i their commuities through public health policies ad services. NACCHO s missio is to be a leader, parter, catalyst, ad voice for local health departmets i order to esure the coditios that promote health ad equity, combat disease, ad improve the quality ad legth of all lives. www.accho.org Medical Home Resources Meaigful Use Resources The Office of the Natioal Coordiator for Health Iformatio Techology (ONC) http://healthit.hhs.gov/portal/server.pt NACCHO Resources Natioal Academy of State Health Policy www.nashp.org Primary Care Developmet Corporatio Medical Home How-To Maual www.pcdcy.org/idex.cfm?orgaizatio_ id=128&sectio_id=2047&page_id=8829 Natioal Committee o Quality Assurace www.cqa.org/tabid/631/default.aspx Patiet-Cetered Primary Care Collaborative www.pcpcc.et/cotet/patiet-ceteredmedical-home Ceter for Medical Home Improvemet www.medicalhomeimprovemet.org/idex.html Commowealth Fud www.commowealthfud.org/topics/patiet- Cetered-Care.aspx Improvig Chroic Illess Care www.improvigchroiccare.org Developig Quality Applicatios for Commuity Health Ceter Fudig http://www.accho.org/topics/hpdp/primarycare/upload/chcissuebrief1-19-2006.pdf Natioal Associatio of Commuity Health Ceters 55

Appedix A Useful Resources Natioal Strategies Natioal HIV/AIDS Strategy http://www.whitehouse.gov/admiistratio/ eop/oap/has Natioal Health Care Quality Strategy ad Pla http://www.hhs.gov/ews/reports/quality/ atioalhealthcarequalitystrategy.pdf Natioal Prevetio ad Health Promotio Strategy http://www.healthcare.gov/ceter/coucils/ phpphc/strategy/ Routie HIV Screeig Resources Itegratig HIV Screeig ito Routie Primary Care: A Model, Tools ad Templates http://www.achc.com/hivmodel.cfm Northwest AIDS Educatio ad Traiig Ceter HIV Web Study Iteractive Tutorials http://depts.washigto.edu/hivaids/idex. html Health Research ad Educatioal Trust HIV Testig ad Screeig Cost ad Reimbursemet http://www.hret.org/disparities/projects/hivtestig-ad-screeig-cost-ad-reimbursemet.shtml Sample Forms Sample Patiet Authorizatio Form Natioal Associatio of Commuity Health Ceters 56

Parterships betwee Federally Qualified Health Ceters ad Local Health Departmets SAMPLE AUTHORIZATION FORM Note: This documet is iteded to serve as guidace ad is ot a template. It does ot reflect the requiremets of your state s patiet iformatio privacy laws. You are advised to cosult with kowledgeable legal cousel prior to usig a Patiet Authorizatio Form. Patiet Authorizatio for Use ad Disclosure of Protected Health Iformatio By sigig, I authorize [isert orgaizatio ame] to use ad/or disclose certai protected health iformatio (PHI) about me to. This authorizatio permits [isert orgaizatio ame] to use ad/or disclose the followig idividually idetifiable health iformatio about me: [specifically describe the iformatio to be used or disclosed, such as date(s) of services, type of services, level of detail to be released, origi of iformatio, etc.] The iformatio will be used or disclosed for the followig purpose(s): The purpose(s) is/are provided so that I may make a iformed decisio whether to allow release of the iformatio. This authorizatio to use ad/or disclose certai protected health iformatio (PHI) about me will expire o [eter date or defied evet]. [Isert orgaizatio ame] will will ot receive paymet or other remueratio from a third party i exchage for usig or disclosig the PHI. I do ot have to sig this authorizatio i order to receive treatmet from [isert orgaizatio ame]. I fact, I have the right to refuse to sig this authorizatio. Whe my iformatio is used or disclosed pursuat to this authorizatio, it may be subject to redisclosure by the recipiet ad may o loger be protected by the federal Health Isurace Portability ad Accoutability Act (HIPAA) Privacy Rule. I have the right to revoke this authorizatio i writig except to the extet that the practice has acted i reliace upo this authorizatio. My writte revocatio must be submitted to the privacy officer at: [Isert ame ad address of etity] Sigature of Patiet or Legal Guardia Relatioship to Patiet Prit Patiet s Name: Date Prit Name of Patiet or Legal Guardia, if applicable Patiet/guardia must be provided with a siged copy of this authorizatio form. Natioal Associatio of Commuity Health Ceters 57

Natioal Associatio of Commuity Health Ceters Cliical Affairs Divisio, 7200 Wiscosi Ave., Suite 210, Bethesda, MD 20814 (301) 347-0400 Fax: (301) 347-0459 www.achc.com