The Community Health Center Association of Connecticut sent a petition Tuesday to the Department of Social Services demanding the agency admit it’s violating state and federal law governing reimbursements for care they provide to low-income patients on Medicaid.
The petitioners — CHCACT, an advocacy organization for Connecticut’s community health centers, and fifteen of its members — sent what’s known as a “declaratory ruling request” to the Department of Social Services. The request asserts that the agency has not been complying with laws that require periodic reviews of, and increases to, Medicaid rates based on changes to services provided by what are known as Federally Qualified Health Centers, or FQHCs.
“Every FQHC’s Medicaid rates must be periodically adjusted to account for all increases (or decreases) to the scope of the medical, dental, and behavioral-health services that the FQHC provides to Medicaid patients,” the filing states. “DSS has done virtually everything in its power not to honor its obligation under the Medicaid laws to pay FQHCs reimbursement rates that reflect cost increases attributable to changes in their scope of services.”
The declaratory ruling request is a first step in legal action, but is not a lawsuit per se. DSS now has 90 days to respond. If the health centers disagree with the agency’s response, the organization could then file a lawsuit in Superior Court, Joanne Borduas, chair of the CHCACT board of directors, said.
“The state’s FQHCs are financially struggling, primarily because we are not receiving adequate reimbursement from our Medicaid rates,” Borduas, who also serves as chief executive of the Community Health and Wellness Center in Torrington. “We have been trying to resolve [this] with the Department of Social Services, but unfortunately, to no avail.”
In an emailed statement, Christine Stuart, a spokesperson for DSS, acknowledged that the agency had received the request and said it would be “analyzing and responding in due course and in compliance with statutes pertaining to petitions of state agencies for a declaratory ruling.”
A spokesperson with Gov. Ned Lamont’s office declined to comment.
Federally qualified community health centers provide health care services to patients who may not otherwise have access to them, and they don’t turn away anyone who cannot pay. In 2023, nearly 70% of Connecticut’s FQHC patients had incomes at or below the federal poverty level, according to data presented in the petition.
In general, community health centers get paid a fixed rate by Medicaid per visit for medical, dental and behavioral health services. That fee can vary based on a facility’s size, volume of patients and the extent of services provided. Federal law requires that those rates get periodically adjusted to account for increases or decreases in the scope of services.
The petition asserts that DSS fails to regularly review and adjust rates, and instead bases its decisions on whether to grant requests for increases on “irrelevant substantive factors” — for example, that the state budget doesn’t allow for a rate increase or that the FQHC isn’t in need of one.
An analysis included in the filing found Connecticut’s average FQHC Medicaid rate to be “at the bottom of the spectrum” in New England, at $163.37 per visit, compared to $297 in New Hampshire, $241.96 in Massachusetts and $196.79 in Vermont.
As a result of DSS’s actions, community health centers have been forced to freeze hiring and reduce or eliminate important services, Borduas, of Community Health and Wellness Center in Torrington, said.
Earlier this month, her organization stopped providing dental services, which they’ve offered since their establishment over 20 years ago, because they can no longer afford it, Borduas told the Connecticut Mirror at the time. The cost to treat a patient is roughly $240 per dental visit, but Medicaid only pays them $170, she added.
Joan Feldman from Shipman and Goodwin is representing CHCACT.
Medicaid reimbursement rates
Connecticut health care providers and legislators have been sounding the alarm that the prevailing reimbursement rates are too low, making it unaffordable for health care providers to treat patients with Medicaid coverage, thus decreasing access to care for those residents.
Gov. Ned Lamont’s administration has said the rates need adjusting, but it had been reluctant to implement broad increases until the state completed a two-part study on Medicaid reimbursement rates. The Department of Social Services published part one last February and part two earlier this year.
In January, state Democratic leaders presented a plan that proposes increasing reimbursement rates for all providers up to 75% of Medicare rates. For services that don’t have a Medicare equivalent, the state would use other benchmarks, including rates paid by peer states.
The governor’s budget proposal for the upcoming biennium proposes a more modest $35.4 million in state funding for Medicaid reimbursement to providers, including $10.4 million in fiscal year 2026 and $25 million in FY 2027. Those funds would go towards multiple provider types, not just community health centers.
But any changes to Medicaid at the state level must contend with fiscal uncertainty presented by looming federal cuts to the program. Borduas said she understands the pressures the state is facing, but, ultimately, the community health centers decided they had to move forward with legal action.
“We could always sit back at some point with the uncertainty around everything that’s happening at the federal level right now, and say, ‘This might not be a good time.’ But we don’t have that time any longer because our patients are depending on us,” Borduas said.