Community Health Workers: Putting Return on Investment into Practice

 

In the first two parts of this series, we examined the expanding roles for Community Health Workers (CHWs) in primary care and multiple ways CHWs can contribute to financial performance.  We also challenged a common question: “How much can a CHW bill?”

This question focuses only on direct reimbursement and disregards much of the financial value CHWs can create. A more useful question for physician leaders is, “How can a CHW be deployed across our practice’s payer and patient mix to generate sufficient financial and clinical value to justify the investment?”

This answer to this question depends on practice size, payer mix, eligible patient populations, participation in care management programs, and strategic use of CHWs across multiple reimbursement and value-based opportunities.

The numbers demonstrate how this looks in practice.

Start with the Investment

Before calculating the return, practices need to understand the CHW investment.  For illustration purposes, assume that one full-time CHW ha a fully loaded annual cost of approximately $85,000 (including salary, benefits, payroll expenses, training, technology, supervision, and other employment-related expenses). 

An $85,000 annual investment amounts to approximately $7,083 in financial value per month to reach break-even.  The important point is that $7,083 should not come from one payer, one set of allowable billing codes, or entirely from direct reimbursement. 

Revenue We Can Measure  

Several existing revenue sources provide a starting point for calculating CHW financial contribution.

Medicare and Community Health Integration (CHI)  

Medicare Community Health Integration (CHI) is very relevant, because many CHI activities align closely with CHW roles, including patient-centered assessment, care coordination, health system navigation, facilitating access to community-based services, patient education and self-advocacy support, and communication with the healthcare team.

For 2026, the national Medicare non-facility payment for G0019 is approximately $86 for the first 60 minutes of CHI services during a calendar month.  Additional qualifying time may be billed using G0022.  Actual reimbursement varies geographically and according to applicable Medicare rquire4ments.

At approximately $86 per patient per month, the financial contribution becomes meaningful quickly.

Table 1. Active CHI Patients per Month Approximate Annual G0019 Revenue

Number of Patients	Approximate Annual Revenue based on $86 PMPM
25	$25,851
40	$41,362
50	$51,702
75	$77,553
83	$85,825

In this example, approximately 83 continuously eligible and billable CHI patients per month could generate annual G0019 revenue sufficient to cover the fully-loaded cost ($85,000) of one CHW.

This does not imply that every CHW should carry a panel of 83 CHI patients or that CHI alone should finance the position.  Relying on one reimbursement mechanism misses the larger CHW revenue opportunity.

Transitional Care Management (TCM)

Transitional Care Management (TCM) provides another source of CHW financial value. The CHW dose not independently bill TCM services.  However, the CHW can help the practice identify eligible patients following discharge, conduct outreach, address SDOH barriers (e.g., transportation), review an reinforce care plans, facilitate timely follow-up, and escalate clinical concerns to the appropriate care team member.

In 2026, national Medicare non-facility reimbursement is approximately $220 for CPT code 99495 and $299 for CPT 99496, depending on the complexity and requirements of the transition.

If CHW-supported workflows help a practice achieve eight additional TCM episodes per month (using a blended reimbursement of $240 as an example), the practice could capture approximately $23,000 in additional annual TCM revenue.  

Again, this revenue is NOT billed independently by the CHW and depends on the structure and processes of workflows incorporating CHWs, where appropriate. .

Michigan Medicaid

Michigan Medicaid provides direct reimbursement for qualifying CHW services, creating a strong potential revenue stream for practices serving Medicaid beneficiaries.

This is especially important when building the business case for CHWs. Practices do not need to rely solely on Medicare CHI reimbursement to support CHW investment; CHW capacity can be aligned across Medicare, Medicaid, and commercial care management populations.

Medicaid CHW reimbursement may contribute significantly to the cost of a CHW position.

Provider Delivered Care Management (PDCM)

For practices participating in Blue Cross Blue Shield of Michigan’s Provider Delivered Care Management (PDCM) program, CHWs may also contribute to reimbursable are management activities within program requirements.

CHWs support patient outreach, care coordination, chronic disease management, transitions of care, self-management, and patient engagement. PDCM is another source of financial return, particularly for practices with well-established care management infrastructure.

PDCM is best calculated based on individual payer agreement, patient enrollment, and patient risk mix. 

Potential CHW Return on Investment for a Small Practice

As an example, we will define a small practice as one with four or fewer physicians employing one fully-loaded CHW at an annual cost of $85,000.

Table 2. Potential CHW Revenue in a Small, Multi-payer Practice with one CHW

Financial Contribution	Example Annual Value
40 active Medicare CHI patients/month	$41,362
8 additional completed TCM episodes/month	$23,040
Michigan Medicaid CHW services	$10,000
Subtotal measurable financial contribution	$74,402
Amount to reach break-even	$10,598

This practice would need approximately $883 per month in additional revenue to reach the $85,000 break-even point.  This may be from PDCM, additional CHI services, additional Medicaid CHW services, other commercial care management programs, or other payer-specific reimbursement opportunities.  This calculation has not assigned financial value to Medicare Advantage quality performance, shared savings, reduced ED utilization, reduced hospital admissions, improved patient engagement, or increased staff capacity resulting from integrating CHWs in workflows. 

Practice Size, Payer Mix, and Patient Opportunities

The potential return on investment for CHW integration varies with practice size, payer mix, and patient opportunities.  This is illustrated in the following example.

Table 3. Illustrative ROI by Practice Size and Programs

Financial Contribution/Revenue	Small Practice	Medium Practice	Large Practice
Active CHI patients/month	40	50	75
Approximate annual CHI revenue	$41,362	$51,702	$77,553
Additional TCM episodes/month	8	12	16
Approximate Annual TCM revenue	$23,040	$34,560	$46,080
Illustrative Medicaid/PDCM/other	$21,000	$25,000	$35,000
TOTAL MEASURABLE FINANCIAL CONTRIBUTION	$85,402	$111,262	$158,633
Illustrative CHW cost	$85,000	$85,000	$85,000
Net Measurable Contribution	+$401	`+$26,262	`+$73,633
Illustrative ROI	~0.5%	~31%	$87%

These examples illustrate how aligning CHWs with payer mix and eligible patient/program populations change the financial potential. A small practice may reach break-even with one CHW, while a medium or large practice may have greater opportunity to add CHW capacity and reimbursement.

Small practices may also elect to share a CHW as they build program capacity.   

These examples do not include all activities where CHWs may contribute to revenue, such as Medicare Advantage Stars, quality incentives, shared savings, reduced unnecessary ED utilization, and improved patient experience.

Summarizing the Business Case

The question is whether one or more CHWs can generate break-even revenue to provide a practice with financial value.  The strongest CHW business model is built by deliberately and strategically deploying CHW capacity across populations, payer programs, and organizational priorities to create sufficient combined value.  This creates the combined financial and clinical value of adding CHWs as essential members of the care team.   

 

NOTE: Financial examples are presented as illustrations and are not guarantees of financial performance or return. Practices should verify current payer policies, contracts, and fee schedules when developing financial projections.