Community Health Centers (CHCs) are non-profit, community-based healthcare providers that form a key part of the U.S. healthcare safety net. These centers deliver comprehensive, high-quality primary care to medically underserved areas and populations. CHCs were established to remove financial, geographic, and cultural barriers to accessing medical services. Their mission is to improve community health by focusing on prevention, early intervention, and managing chronic conditions.
Defining the Community Health Center Model
Community Health Centers are distinct from traditional private medical practices because their mission prioritizes patient need over financial profit. They are non-profit organizations created to serve populations facing barriers to accessing care, including those who are uninsured, underinsured, or geographically isolated. This model ensures high-quality primary care is available in areas designated as Medically Underserved Areas (MUAs) or for Medically Underserved Populations (MUPs).
CHCs are often referred to as Federally Qualified Health Centers (FQHCs) because they meet stringent federal requirements to receive funding and benefits. This designation authorizes the centers under Section 330 of the Public Health Service Act (PHSA), which outlines the rules for their operation and grant funding. Unlike private practices, CHCs are governed by a board structure that is majority patient-controlled, ensuring accountability to the community they serve.
The core identity of a CHC is providing accessible and affordable primary care as the first point of contact for medical attention. Physicians at CHCs are incentivized toward quality care and public health outcomes rather than revenue generation. The model relies on interdisciplinary teams, including physicians, nurse practitioners, and physician assistants, to deliver comprehensive services.
Comprehensive Scope of Services
CHCs are mandated to offer a broad range of services that address the complex needs of their patient populations. Core medical services include family medicine, pediatrics, internal medicine, obstetrics, and gynecology. This primary care focus covers routine check-ups, immunizations, and the management of chronic conditions like diabetes and hypertension.
Beyond basic medical care, CHCs are federally required to provide services addressing broader health needs. Dental care, including preventive services and screenings, is a mandated offering, as access is often limited for underserved groups. Mental health and substance abuse services, such as counseling and treatment, must also be provided either directly on-site or through formal arrangements with other providers.
To eliminate non-medical barriers, CHCs provide “enabling services.” These services include health education, translation for patients with limited English proficiency, and assistance with transportation. CHCs also offer outreach and help with enrollment in federal, state, and local programs to connect patients with necessary social services. This holistic approach integrates medical, behavioral, and social support.
Eligibility and Access
A defining characteristic of the CHC model is the commitment to serving all individuals who seek care. CHCs are prohibited from turning away any person based on their insurance status, residency status, or ability to pay. This open-door policy ensures that uninsured or underinsured people, who might otherwise delay treatment, have a reliable source of care.
To make care affordable, CHCs must implement a Sliding Fee Discount Program (SFDP). This program calculates patient fees based on family size and household income relative to the Federal Poverty Guidelines (FPG). Patients whose income falls below a certain FPG percentage, typically 100% or 200%, qualify for significant discounts, sometimes reducing the cost of a routine visit to a minimal co-pay.
To qualify for the sliding fee discount, patients must provide proof of income and family size, and eligibility must be renewed annually. CHCs ask patients to pay what they can, but no one is denied care if they are unable to pay the full cost at the time of the visit. This mechanism ensures that cost does not become a barrier to receiving comprehensive services.
Operational Structure and Funding
Community Health Centers operate on a financial model blending public funding with earned revenue. The federal government provides core operating funds through Section 330 grants, managed by the Health Resources and Services Administration (HRSA). These grants are a foundational funding stream that allows CHCs to maintain the sliding fee scale and expand services.
The largest source of revenue comes from payments for services rendered, primarily through Medicaid, Medicare, and private insurance. Medicaid reimbursement is particularly important, as over 80% of CHC patients are covered by Medicaid, Medicare, or are uninsured. CHCs receive an enhanced reimbursement rate from Medicaid and Medicare under a special Prospective Payment System (PPS). This system is designed to compensate them for the higher cost of serving a medically complex and underserved population.
A unique structural requirement for FQHCs is the composition of their governing board. At least 51% of the board members must be patients of the center. This mandatory patient-majority board ensures that the center’s leadership is directly accountable to the community and responsive to local health needs. This governance model, combined with grants and enhanced government reimbursement, creates the financial stability necessary for CHCs to fulfill their mandate.