APM Pilot Program

Senate Bill 147 (2015) authorizes the Department of Health Care Services (DHCS) to conduct an Alternative Payment Methodology (APM) pilot, beginning no earlier than July 1, 2016. This APM pilot allows Federally Qualified Health Centers (FQHC) flexibility in payment equating to greater efficiencies in health care delivery and expanded primary care capacity.

Background: Annually, the Centers for Medicare and Medicaid (CMS) sets a volume-based federal Prospective Payment System (PPS) rate for FQHCs. Federal regulations require that FQHC’s reimbursements must be equivalent to the federal PPS rate.