The Clinic's Tale: Chasing FQHC Status Not for the Faint-Hearted

When a Los Angeles clinic leader decided to seek FQHC status, he thought financial stability would soon follow. But that was just the start of an odyssey that is finally paying off.

July 2012

The Central Neighborhood Health Foundation has been providing care to generations of the working poor and uninsured in a Los Angeles region near the Watts neighborhood. By the early 1990s, changes in the Medi-Cal program resulted in a steep drop in patient load, and the clinic had to reduce staff as it struggled to maintain financial stability.

Bassett Brown, MD, Central Neighborhood's founder and CEO, decided to seek designation as a Federally Qualified Health Center (FQHC). In the slideshow below, see Dr. Brown with clinic patients and other clinic leaders.

  • Dr. Bassett Brown with patient Gayle Dowell. A community fixture in L.A.’s Watts area, the Central Neighborhood clinic has served generations of working poor and uninsured. The clinic is climbing back to financial stability after several difficult years.
  • Dr. Brown with patient Daisy Castellanos. In the early 1990s, following Medi-Cal changes, "Everything was dying on the vine," said Brown. "Our patient load was dropping, so we had to let doctors and personnel go, one by one."
  • Clinic President Mervyn Dymally with Dr. Brown. "The only way we were going to survive was to convert from a for-profit to a nonprofit and become an FQHC," said Brown. The clinic received FQHC Look-Alike status in 2010, but the difficulties didn’t end there.
  • Quality Manager Prudencia Kintaudi and Dr. Brown. Unfamiliarity with FQHC rules cost the clinic between $500,000 and $750,000 in lost revenue as they tried to conform to confusing requirements among several state and federal agencies.
  • Dr. Mehrangiz Cadry and Dr. Brown. Working with a consultant, the clinic eventually started receiving proper reimbursement. It now sees about 200 patients a day. Central Neighborhood was awarded a Healthy Way L.A. contract to provide a medical home for low-income patients.

This case study follows the precipitous path of the clinic since it began its quest for FQHC designation in 2004. Complicating the run-up to submission of the clinic's application was the need to simultaneously convert the organizational structure from for-profit to nonprofit. Central Neighborhood ultimately submitted its inch-and-a-half-thick FQHC application, in triplicate, in March 2009.

Approval of FQHC Look-Alike status came in August 2010 from the federal Health Resources and Services Administration (HRSA), the administrators of the FQHC program. But the aftermath was as difficult as the run-up to the change in status. Central Neighborhood's unfamiliarity with myriad FQHC rules collectively cost the clinic between $500,000 and $750,000, the bulk of which resulted from Medi-Cal underpayments. Eventually, with consulting assistance, the clinic was able to begin receiving its proper reimbursement and found its way to firmer ground.

Although Central Neighborhood's FQHC odyssey has been daunting, the clinic's future looks brighter.