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Amendment to PIN 1997-27 Regarding Affiliation Agreements of Community and Migrant Health Centers

I. INTRODUCTION

The purpose of this Policy Information Notice (PIN) is

  • to clarify the Bureau of Primary Health Care's (BPHC) position with respect to affiliation arrangements that involve community and migrant health centers contracting for the services of a Chief Financial Officer (CFO), Chief Medical Officer (CMO) and/or the majority of its primary care clinicians, regardless of the type of entity with which the health center is affiliating, and
  • to clarify the BPHC’s review process for affiliation arrangements. The BPHC is allowing for situations where community and migrant health centers (C/MHCs) may not directly hire staff in the positions described above. (The requirement that the health center directly employ the Executive Director remains in effect.)

The BPHC recognizes that there are certain situations in which exceptions to the BPHC’s preference that health centers directly employ personnel to fill these positions (CFO, CMO, clinicians) may be necessary and appropriate in order to maximize access to comprehensive, efficient, cost-effective, and quality health care. The BPHC is committed to allowing exceptions to the preference upon community and migrant health centers assurance that its accountability is maintained. Accountability, as well exception is approved and implemented to assure that the center continues to meet its mission, Federal requirements, and program expectations. This PIN sets forth criteria for reviewing requests for exceptions to the BPHC's preference that the health center directly employ its CFO, CMO and/or its core staff of full-time primary care providers. The PIN also explains the review process for determining whether affiliation arrangements are in compliance with PIN 97-27 and this PIN.

II. UNDERLYING ASSUMPTIONS

The BPHC’s decision to grant exceptions to the preference that C/MHCs directly employ its CFO, CMO and its core staff of full- time primary care providers is premised on the following assumptions:

    • The health center’s mission to provide access to
      comprehensive health care services to the underserved
      and vulnerable populations will be maintained and/or
      expanded through appropriate health center affiliations
      which further the development and operation of
      integrated health systems.
    • C/MHCs will maintain compliance with integrity and
      autonomy requirements while participating in integrated
      health systems that enable health centers to achieve
      their mission. The health center’s continued
      accountability to the BPHC will need to be documented.
      o Each C/MHC will conduct its own assessment and draw
      conclusions from within their own situation and
      environment as to whether program viability is
      maintained and programmatic benefit is derived from
      such arrangements.

III. ACCOUNTABILITY

Federal requirements and policies regarding community and migrant health center accountability are derived from Section 330 and implementing regulations, Department of Health and Human Services (DHHS) administrative regulations and binding DHHS and Public Health Service (PHS) grants policy. The BPHC will approve exceptions with respect to staffing arrangements based on health center maintenance of accountability in the following areas: 1) operating the grant-approved project; and, (2) expending grant funds in accordance with applicable rules.

Affiliation arrangements will be reviewed against the following criteria:

  • The health center has reserved sufficient rights and control to maintain overall responsibility for the direction of the project, as originally funded, and for continued accountability to BPHC.
  • The health center has provided justification for the performance of the work by a third party, showing that the work cannot be more efficiently and effectively performed directly by the grantee.
  • The health center has in place appropriate systems and processes to assure that the contractor will satisfactorily perform all contract activities in accordance with section 330 requirements.
  • The C/MHC has documented that the written agreement with the contractor complies with current DHHS administrative requirements in the following areas:
    • contains appropriate provisions around the activities
      to be performed, time schedules, the policies and
      procedures to be followed in carrying out the
      agreement, and the maximum amount of money for which
      the grantee may become liable to the contractor under
      the agreement;
    • requires the contractor to maintain appropriate financial, program and property management systems and
      records and provides the health center, DHHS and the
      U.S. Comptroller General with access to such records;
    • requires the submission of financial and programmatic
      reports to the health center;
    • complies with Federal procurement standards (including
      conflict of interest standards); and
    • is subject to termination (with administrative,
      contractual and legal remedies) in the event of breach
      by the contractor.

IV. BPHC REVIEW PROCESS FOR AFFILIATION ARRANGEMENTS AND EXCEPTION REQUESTS

To assure that affiliation agreements comply with requirements for funding it is important that the BPHC review affiliation agreements and determine and monitor compliance with the policies in PIN 97-27 and this PIN. When applicable, C/MHCs will complete a C/MHC Affiliation Checklist (see Attachment) regarding affiliation arrangements as part of their continuation application. Through the C/MHC Affiliation Checklist, the health center will identify relevant reference documents (e.g., Articles of Incorporation, by-laws, contracts, affiliation agreements, memoranda of understanding, other), and specific citations within them, that demonstrate compliance with the accountability requirements in PIN 97-27 and this PIN. The BPHC will review these completed checklists along with the documents as part of the application review process. The results of the BPHC’s review will be communicated with the continuation application decision . Health centers will be afforded an opportunity to resolve any outstanding issues related to the affiliation agreement.

In those instances where it is necessary to request a review for compliance of a new affiliation arrangement or significant changes in an existing affiliation arrangement during a given budget period, the grantee should submit the Affiliation Checklist along with supporting documents to the Office of Grants Management for review and approval in accordance with the BPHC’s process for post award requests. The BPHC is committed to providing feedback within a thirty (30) day period.

For Federally Qualified Health Center Look-Alikes, affiliation reviews will be coordinated with the designation and recertification processes.

The review of the C/MHC Affiliation Checklist and accompanying documentation will be overseen by staff of the Division of Community and Migrant Health and will involve the applicable Field Office staff. Health centers are strongly encouraged to obtain consultation on draft documents prior to submitting final documents through the review process.

V. MONITORING

After the exceptions have been approved, the BPHC will monitor the overall impact of the affiliation arrangement on the C/MHC’s performance. Through existing monitoring systems the BPHC will assess the accountability of the grantee, as well as the programmatic benefits from the affiliation arrangements during Primary Care Effectiveness Reviews, diagnostic and other reviews.

The programmatic benefit assessment includes the following areas:

  • continued or improved access (i.e., increased capacity
    evidenced by additional services provided and/or more people
    served);
  • improved expertise (i.e., management, financial, and/or
    clinical);
  • increase in capital (i.e., increased working capital, improved
    infrastructure, more efficient use of available resources); and/or
  • maintained or improved quality of care (i.e., improved
    services, as measured through patient satisfaction, and/or
    improved care, as measured through improved health
    outcomes).

 COMMUNITY AND MIGRANT HEALTH CENTER AFFILIATION CHECKLIST

Organization: _______________________________

Grant # _____________________

  

(where applicable)

TYPE OF ARRANGEMENT: 

 

_____Merger_____Acquisition

_____Parent Subsidiary Model

 

_____Establishment of a New Entity _____Jointly Owned or Directed Jointly (eg. Network corporation) by a Health Center and an Affiliation Partner

_____Contract for a substantial portion _____Other (describe) of the project

Name and Type of proposed Affiliate Organization(s): ________________________________

ELEMENTS OF PROGRAM ACCOUNTABILITY:

Check “yes” if in compliance and “no” if not. Identify reference documents and appropriate page number, and attach copies . Attach explanations for any “no” responses.

GOVERNANCE :

The Health Center Board structure is in compliance with requirements. YES ____ NO ____

Reference
Document Page #

C board composition _____________ ______ C executive committee function and composition _____________ ______ C selection of board chairperson ___________________ C selection of members _____________ ______

The health center’s Board retains its full authorities, responsibilitie s
and functions as prescribed in legislation/regulations. YES ____ NO ___ _

Reference
Document Page #

  • strategic planning _____________ ______
  • approval of the annual budget of the center _____________ ______
  • directly employs, selects/dismiss and evaluates the CEO _____________ ______
  • adoption of policies and procedures for personnel _____________ ______
  • and financial management
  • establishes center priorities _____________ ______
  • establishes eligibility requirements for partial payment of services _____________ ______

 

Organization: ____________________________

Grant # _________________

 

(where applicable)

 

Reference

 

 Document

Page #

 

provide for an independent audit 

 

 

evaluation of center activities 

 

 

adoption of center’s health care policies including 

 

scope and availability of services, location, hours

 

 

of operation and quality of care audit procedures 

 

 

establishes and maintains collaborative relationships 

 

 

with other health care providers in the service area 

 

 

existence of a conflict of interest policy 

 

 

The arrangements do not compromise the Board authorities or limit  its legislative and regulatory role. Examples of compromising arrangements are: overriding approval or veto authority by another entity; dual majority requirements; super-majority requirements; or hiring and selection of the CEO.

YES ________ NO _________

 

STAFFING

The center directly employs the CFO, CMO and the core staff of full-time primary care providers.

YES ________ NO _________

If NO, the CEO of the center retains the authority to select and dismiss staff assigned to the center.

YES ________ NO _________ (Please cite reference document and page #.) ________________________________________

 

CONTRACTING

 The center has justified the performance of the work by a third party.YES ________ NO _________

Written affiliation agreement(s) comply with current DHHS policies, i.e.:

YES ________ NO _________

 

  • contains appropriate provisions around the activities to be performed, time, schedules, the policies and procedures to be followed in carrying out the agreement, and the maximum amount of money for which the grantee may become liable to the contractor under the agreement; _____________ ______

 

Organization: ________________________________ Grant # ________________

(where applicable)

Reference
Document Page #

  • requires the contractor to maintain appropriate financial, program and property management systems and records

in accordance with 45 CFR Part 74 and provides the center, DHHS and the U.S. Comptroller General with access to such records;

  

 

requires the submission of financial and programmatic reports to the health center;______________ 

 

complies with Federal procurement standards including conflict of interest standards;______________ 

 

is subject to termination (with administrative, contractual and legal remedies) in the event of breach by the contractor.______________ 

 

Signature of Governing Board Chairperson _____________________________________
Date ______________

PLEASE LIST ALL ATTACHMENTS



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