Federally Qualified Health Centers (FQHCs) are public or nonprofit clinics that care for patients regardless of insurance status or ability to pay. FQHCs are as diverse as they are widespread and are integral to the state’s safety-net provider landscape. In the period immediately following the implementation of the federal Affordable Care Act (ACA) in 2014, many FQHCs experienced rapid growth. In the post-ACA period, FQHCs have continued to add patients and clinic sites at a rapid pace in regions throughout the state, and many health centers have increased offerings of specialty services and of care for elderly patients.

This report, part of the California Health Care Foundation’s Regional Markets Study series, examines the changing FQHC landscape, focusing on emerging trends and regional differences in FQHCs across the state. Some of the key findings include these:

• Across the state, FQHCs have continued robust growth and expansion in the post-ACA period. Some regions experienced a tripling of patient visits over the 2014–19 period, while regions with more-established FQHCs saw continued, if more modest, growth.
• Data suggest more room for expansion, particularly in regions where the number of FQHC visits per person is lower.
  Growth has occurred both through acquisitions of existing private medical practices and clinics and also through construction of new facilities.
• Expansion of FQHCs has been accompanied by some growing pains, including occasional conflicts with existing private practices and other providers as well as difficulties with recruiting enough qualified staff.
• FQHCs have become increasingly large and sophisticated. FQHCs in nearly all regions can join a clinic consortium or association, many clinics are part of large and growing clinic networks, and service offerings are increasing.
• FQHCs are increasingly participating in independent practice associations and exploring ways to continue to serve patients as they age by adding Medicare Advantage and Programs of All-Inclusive Care for the Elderly.
• The COVID-19 pandemic had a significant impact on FQHCs, causing severe financial hardships for many health centers while hitting FQHC patients harder than many other groups in the state; the financial dislocation, however, has caused some to look at value-based payment methodologies in a new light.
• Looking ahead, questions have emerged about whether increasingly large organizations will lose their community focus and whether the highly regulated environment surrounding FQHCs limits their ability to be innovative and to respond to community needs.

Since 2009, CHCF has published a series of regional market studies that examine the health care markets in specific regions across California. These studies highlight the range of economic, demographic, and health care delivery and financing conditions in California. They are published as part of the CHCF California Health Care Almanac, an online clearinghouse for key data and analyses examining California’s health care system.

About the Authors

Matthew Newman, MPP, is principal and cofounder of Blue Sky Consulting Group. James Paci, JD, MPP, is a policy analyst with Blue Sky Consulting Group. Caroline Davis, MPP, is president of Davis Health Strategies and a Blue Sky Consulting Group affiliate. Len Finocchio, DrPH, is principal consultant at the Blue Sky Consulting Group. Jill Yegian, PhD, is principal of Yegian Health Insights and a Blue Sky Consulting Group affiliate. Katrina Connolly, PhD, is a senior consultant with Blue Sky Consulting Group.

Blue Sky Consulting Group helps government agencies, nonprofit organizations, foundations, and private-sector clients tackle complex policy issues with nonpartisan analytical tools and methods.