MPCA outlines phased Medicaid alternative payment methodology for Michigan health centers

The Michigan Primary Care Association told the House Appropriations Subcommittee on Medicaid and Behavioral Health it is designing an alternative payment methodology (APM) for federally qualified health centers (FQHCs) that would change how Medicaid reimburses community health centers, enabling more team‑based and population‑focused care.

Philip Bergquist, CEO of the Michigan Primary Care Association (MPCA), said the APM work responds to limits in the current prospective payment system (PPS), which he said was established in federal law and adopted by Michigan in 2001 and now often fails to match the current cost and team‑based delivery of care. Bergquist said health centers save the Medicaid program money—citing a Michigan State University analysis that health centers save about $612 per Medicaid member annually and that statewide savings total roughly $170 million per year compared with other Medicaid providers.

What the APM would do: Bergquist described converting part of per‑visit Medicaid payments into a predictable monthly (partial capitation) payment for patients assigned to a…