3 Common Challenges of Value-Based Care for FQHCs (with Solutions)


Value-based care (VBC) represents a very different mindset than traditional fee-for-service (FFS) models. It requires providers to adopt a proactive, team-based stance toward patient care and focus more heavily on preventive screenings, chronic disease management, and reducing avoidable utilization.  

This change in approach can seem daunting for many organizations, especially those that already feel pushed to their limit.  However, it isn’t necessarily such a stretch for Federally Qualified Health Centers (FQHCs), which tend to be very experienced at providing primary care with a socioeconomically informed flavor.

Formally moving away from fee-for-service by joining a value-based care model can help FQHCs overcome some of their most deeply entrenched financial and clinical challenges.

For the full breakdown on the opportunities that value-based care presents for FQHCs, download our guide.

Common value-based care challenges and opportunities that FQHCs face

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Photo via SHVETS production

1. Managing volume


FQHCs are overwhelmed by patient volume and struggle to stay ahead of rising risks, since FFS does not incentivize preventive care.  As a result, they spend more time and money on treating patients at the high end of clinical complexity, which limits their availability for new patients.


VBC helps FQHCs manage volume by focusing on prevention, wellness, and chronic disease management.  With population health strategies, data analytics tools, and multidisciplinary care teams, FQHCs can keep patients healthier for longer and reduce resource utilization while allowing clinicians to work at the top of their license.

2. Enhancing revenue


Community health centers rely heavily on grant funding. Applying for grants is time consuming, the funding may only be available for a limited time, forcing health centers to spend a great deal of effort time hunting down new grant opportunities.


VBC models often reward providers for the same quality improvement activities that they are already conducting under their grant programs. By layering value-based care incentives on top of existing grant initiatives, FQHCs may be able to enhance their revenue without much additional clinical work.

3. Addressing social determinants of health


FQHCs are mission-driven to provide holistic care to their communities. They understand the impact of non-clinical challenges that prevent their patients from living their healthiest lives.  But FFS reimbursements rarely allow providers to adequately address the social determinants of health (SDOH) and may limit opportunities to coordinate with much-needed community-based services.


Value-based care arrangements prioritize whole-person care and incentivize participants to deliver socioeconomically appropriate and culturally sensitive care. Many models actively reward SDOH-related activities and enable participants to expand their non-clinical services, improve quality of life, and prevent more expensive utilization down the line.

The benefits often outweigh the challenges of value-based care

While some FQHCs may feel trepidation about switching from a fee-for-service model to a value-based care model, doing so has the potential to:

• Access a more sustainable revenue model that’s risk free

• Scale up care for more people in need within your community

• Ensure your organizations’ interests are met with collective bargaining power

Interested in learning more? Get our free guide on what value-based care means for FQHCs.

Editor's note: This article originally published in January 2022 and was updated in March 2024.

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