We offer this publication as a member service of the West Virginia Primary Care Association (WVPCA).

This is the second installment of the Monthly Legal Minute with Jackson Kelly PLLC. This month's article discusses discuss a key legal requirements specific to Federally Qualified Health Centers ("FQHCs"). As "safety net" providers of health care, the ability of FQHCs to serve their patient bases is critically important. The governing boards of FQHCs are strategic catalysts towards effective patient care, since they are the key decision-makers of the organizations. This article will detail some of the most significant requirements for FQHC governing boards in terms of board composition, responsibility, and authority.

Section 330(k)(3)(H) of the PHS Act (42 U.S.C. § 254b) states that all FQHCs must establish an independent governing board that assumes full authority and oversight responsibility for the FQHC. As such, governing boards must be comprised of individuals who not only hold the patients' interests as paramount, but who also will take responsibility and action to ensure the operational and financial success of the facility.

In furtherance of these principles, certain board composition requirements must be met by all FQHCs. Specifically, there must be a minimum of nine or a maximum of 25 members of the board. The CEO may serve only as non-voting ex-officio member of the board, and board members may not be employees (or an immediate family member of an employee).

A majority of the members of the board (at least 51 percent) must be individuals who are served by the health center. Moreover, patient board members must reasonably represent the individuals who are served by the FQHC in terms of race, ethnicity, and sex. FQHCs are also encouraged to consider patient members' representation in terms of other factors such as socioeconomic status, age, and other relevant demographics.

With respect to non-patient board members, those individuals must be representative of the community currently served by the FQHC and must be selected for their expertise in pertinent subject areas, such as local government, finance and banking, the law, trade unions, or social service agencies in the area. Also, no more than one-half of the non-patient board members may derive more than 10 percent of their annual income from the health care industry.

In addition to board composition, an FQHC must make sure its governing board's authority, functions, and responsibilities are aligned with certain FQHC requirements. Governing boards are responsible for ensuring that the FQHC is financially stable and is operating in accordance with applicable federal, state, and local laws and regulations as well as its own established policies and procedures. Therefore, board members should be knowledgeable about the community and health care industry trends, and must be willing to adapt the health center's policies and positions to facilitate an effective response to these emerging issues.

Importantly, the board must ensure that its authority is not trumped by any third-party interest. As such, no other entity may have an overriding approval authority over the board, and no other entity (aside from the FQHC board) may have the authority to select or dismiss the CEO/Executive Director. This prohibition includes cases where FQHCs combine the CEO position with that of any other key management staff.

In sum, these board requirements ensure that FQHCs have the potential to succeed and effectively assist their local communities, including the underserved populations residing there. By adhering to these requirements, the FQHC, its patients, and the entire community will benefit from FQHC board accountability and efficacy.

 ***

Rachel Ludwig is a healthcare lawyer at Jackson Kelly PLLC.  She is available for consultation through a special retainer relationship with the WVPCA.  Rachel can be reached (304) 340-1185.

To sign up to receive the WVPCA Weekly Newsletter, click HERE