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Is Your Hospital Considering Residency Program Development with FQHCs?

In light of health reform, your organization may be considering Federally Qualified Health Center (FQHC) development, whether it be establishment of a new entity or collaborating with an existing FQHC entity. Over the course of the next 5 years, $11 billion will be dedicated as new funding for FQHCs. Over 80% of the funding is earmarked towards operations ($9.5 billion) and the remainder ($1.5 billion) towards capital needs. FQHCs are a force to content with considering these rich allocations.
Paramount to residency programs and physician recruitment, health reform opens the door relative to FQHCs to qualify as a teaching center - a community-based, ambulatory care center that operates a primary care residency program. Health reform creates two new programs under the teaching health centers provision: 
  • One through a Title VII grant program for development of a teaching health center program, and
  • The second through a Title III program that funds payments to teaching FQHCs for their direct and indirect costs.  
Clearly, FQHCs are well-positioned regarding residency program development. Our firm, Executive Resources, LLC and affiliated firm, Besler Consulting (EXEC/Besler) are not new to FQHC development, especially as it relates to working with hospitals and health systems pursing alternative program and service delivery strategy, which could include residency affiliations with FQHCs. For 15 years, we have been involved in performing FQHC-related technical assistance to hospitals, health systems, government entities, foundations, physician groups, and ambulatory providers, including FQHCs.
If your organization, as the teaching hospital with residency programs in place, is interested in developing some type of collaborative arrangement with an FQHC as the provider of services, it is paramount that the parties appropriately define their respective authorities/responsibilities for training/teaching activities as contrasted to the provision of direct clinical care.
The general principle steering the distribution of authority/responsibility should be that the teaching hospital retains primary authority and control over, and is responsible for covering costs associated with, teaching/training activities at the residency training site if the that site becomes an FQHC site while the FQHC retains authority and control over, and is responsible for encompassing costs associated with, the provision of primary care within its Federal scope of project (under section 330 guidance) and also relative to the fact that the FQHC is the licensed and billing provider.
While the distribution of authority/responsibility is generally allowable, the particular requirements for each type of residency program (i.e. Medicine, OB, Dental) may vary considerably and need to be individually examined. EXEC/Besler can assist your hospital analyze your particular residency program requirements and see how they “fit” relative to potential FQHC development. We work with teaching hospitals and hospitals that are developing teaching programs relative to residency program requirements, staffing and compensation methodologies, allocation of costs, resident and preceptor scheduling, issues involving GME, and issues involving health reform involving FQHCs and residency programs. If you would like to know more about how EXEC/Besler can assist your hospital, please give us a call at 732-974-7200.


Contact us, and we'll be happy to tell you exactly how we can address your particular institutional situation.