April 01, 2013

Truce Zone in the ACA Wars: Community Health Centers

Jason Wesco
It is, therefore, the policy of the United States to eliminate the paradox of poverty in the midst of plenty in this Nation by opening to everyone the opportunity for education and training, the opportunity to work, and the opportunity to live in decency and dignity.
—Preamble, Economic Opportunity Act of 1964

Community Health Centers (CHCs), along with Head Start and the Legal Services Corporation, were conceived in President Lyndon Johnson’s War on Poverty. Each of these programs was to contribute to the achievement of the lofty goal of eliminating root causes of poverty. CHCs, initially called neighborhood health centers, were to provide access to health and social services in underserved communities and to promote community healthcare empowerment, or “community health action,” in the words of Dr. Jack Geiger, CHC architect and the driving force behind the program. In keeping with his vision, funds flowed directly to local nonprofit centers, bypassing state governments, which, at the time, might not have supported the CHCs’ work and philosophy.

The original health center plans called for significant community involvement through community health councils—patient-led advisory boards—to ensure that centers were responsive to community needs. Both Head Start and the Legal Services Corporation also required consumer/client representation on their governing boards.

Federal CHC funding was approved in 1965 for the first two neighborhood health centers. These opened in Boston in 1965 and Mound Bayou, Mississippi, in 1967, the latter having been founded by Dr. Geiger. In addition to direct primary medical care, these centers also provided a range of support services such as transportation, translation, and health literacy classes, all with the primary objective of reducing barriers to health care and the ultimate goal of eliminating problems caused by poverty.

In the 1970s, the health center program was moved from the Office of Economic Opportunity to the Department of Health, Education, and Welfare, now the Department of Health and Human Services (HHS). HHS’s Health Resources and Services Administration, Bureau of Primary Health Care, currently administers the program. See Public Health Service Act § 330, 42 U.S.C. § 254b.

CHCs are also referred to as Federally Qualified Health Centers (FQHCs). The FQHC program, created through the Omnibus Budget Reconciliation Act of 1989 and expanded by the Omnibus Budget Reconciliation Act of 1990, allowed CHCs to receive payments based on the actual cost of services provided to Medicare and Medicaid patients and also to the “low-income uninsured,” i.e., people too poor to buy their own insurance but not poor enough to qualify for Medicaid. CHCs had historically received grants to care for the low-income uninsured. However, these monies tended to be used to cover costs of Medicaid and Medicare that had not been fully paid by those programs, thus shortchanging funding for health care for the low-income uninsured. The FQHC program allowed CHCs these special payments to ensure that grant dollars intended for the latter did not need to be diverted to cover the costs of providing care to Medicaid and Medicare patients. So, while you may hear CHCs referred to as FQHCs, FQHC simply describes a payment mechanism—and a very important one at that, one that helps shore up the safety net that can be so essential to millions of uninsured people throughout our country.

I am the CEO of a Community Health Center, the Health Partnership Clinic, and I would like to take this opportunity to describe to you the little-known but increasingly important role CHCs play in our national healthcare landscape.

CHC 101

Political leaders of all stripes agree that CHCs are good investments. The largest expansion of health centers was funded through President Obama’s Affordable Care Act (ACA). Our Center in Kansas, which had been a free clinic prior to passage of the ACA, received its CHC funding during this expansion. The largest expansion prior to passage of the ACA happened during George W. Bush’s presidency. Political leaders as diverse as Governor Sam Brownback of Kansas and Senator Bernie Sanders of Vermont were strong CHC advocates at that time.

In our climate of bitter partisanship, what is it about CHCs that has created consensus? CHCs are:

  • Accessible. Ninety-two percent of CHC patients are considered “low income” by HHS. This designation is essentially applied to individuals and families whose incomes are two times the federal poverty level. A family of three, for example, is considered “low income” when earnings are $39,606 or below, per the most recent HHS guidelines. To accommodate the working poor, CHCs are often located on public transit routes and are open extended hours to accommodate patients’ schedules. Our Center, for instance, is open until 9:00 p.m. two nights each week and is open two Saturdays per month. CHCs see all patients regardless of income, with the bulk of patients being low-income uninsured and on Medicaid. CHCs also see Medicare patients and those with private insurance, since sometimes these patients, too, do not have adequate access to care because of their income levels or provider shortages. 
  • Accountable. CHCs are required to submit regular financial and program reports to various funders, most notably the federal Bureau of Primary Health Care. Local patient-led governing boards also help ensure that CHCs are focused on patient outcomes and are good stewards of monies entrusted to them. The White House Office of Management and Budget during the George W. Bush administration ranked CHCs as one of the 10 most effective government programs—a designation earned by only six percent of all federal programs. 
  • Affordable. CHCs provide care to all people regardless of their ability to pay. Those patients who apply for discounts must provide income information in order to qualify for discounts, but if they cannot pay, that inability to pay is not a barrier to receiving services. Low-income uninsured individuals are provided care on a sliding scale, with the very poor paying a nominal fee for the care they receive ($10 in our Center). 
  • Comprehensive. CHCs offer a wide variety of services, including medical, dental, and behavioral health services, often in “one-stop-shop” locations to help ensure that care is delivered in an accessible and integrated manner. 
  • Cost-Effective. CHCs excel at offering lower-cost primary care to those in need. In some cases, care is provided for as much as 50 percent less than the same care offered in settings such as hospital emergency departments. 
  • High Quality. Ninety-nine percent of surveyed CHC patients report being satisfied with the care they receive. Further, many CHCs are already designated (and many more are engaged in the designation process) as Patient-Centered Medical Homes, a much-sought-after, private national certification administered by the National Committee for Quality Assurance (NCQA), which offers a kind of “Good Housekeeping Seal of Approval” to medical care providers. Very few private providers are NCQA-approved. I am proud to report that our organization received a Level III NCQA certification—the highest approval rating—in January 2012. 
  • Locally Controlled. While CHCs receive federal grants, they are not federal entities. The hallmark of CHCs, in fact, is that governing boards are diverse and patient led. By law, CHC patients must hold 51 percent of board positions, which limits the number of healthcare professionals on the boards.
  • Needs Driven. Becoming a CHC is an incredibly competitive process. The rigors of this process help ensure that only the most capable organizations in the areas of greatest need are funded. The most recent grant round attracted more than 800 applications, of which 286 received funding. Funding through the ACA resulted in a far higher percentage of awards than any funding round in recent memory. Even so, grantees had to score 94 or higher to be funded.

Given the growing concern about the rising costs of health care and access to care for 50 million uninsured Americans, it becomes clear why CHCs are something on which most everyone agrees. And yet, CHCs are also supported in a big way by the ACA—a source of great divisiveness. Let’s take a look at the ACA and the ways it has greatly benefited, and can continue to benefit, America’s CHCs.

CHCs and the ACA

The Patient Protection and Affordable Care Act is one of the most sweeping pieces of legislation in our history, and it is the most significant package of health legislation since the passage of Medicare and Medicaid in 1965. Its 900 pages include a wide range of measures to be implemented over a 10-year period, from those that allow dependents to remain on their parents’ insurance policies until age 26 to those that completely phase out the Medicare Part D coverage gap (“the donut hole”). Often overlooked in the rancor over the ACA, however, are several provisions that greatly benefit CHCs and the patients we care for.

  • CHC Expansion. The ACA provides CHCs more than $11 billion in new funding over a five-year period, including $9.5 billion to expand operational capacity by funding new sites and services and $1.5 billion for much-needed capital expansion projects. More than 267 new CHC sites have already been funded through the ACA, with 398 construction and renovation projects underway or completed. 
  • National Health Service Corporation. Over five years, $1.5 billion will be dispersed for loan repayment to more than 15,000 medical, dental, and behavioral health providers who agree to work in designated underserved areas. Many of these providers will work in CHCs. 
  • Health Insurance Exchange Payments. The much-discussed health insurance exchanges will, among other things, make subsidized private insurance available to low-to-moderate income individuals. It is generally believed that those with subsidized plans will often seek care at CHCs—because many of them already receive care at CHCs. The ACA requires that private insurers contract with CHCs as providers and that they pay CHCs at their established Medicaid rate, since, as previously mentioned, by law CHCs must be paid at a rate that allows them to recoup their costs for services provided to Medicare and Medicaid patients, thereby ensuring that all federal grant money dedicated to providing care to the low-income uninsured is used for that group alone, as opposed to being diverted to cover Medicaid and Medicare costs. 
  • Teaching Health Centers. In recognition of the growing role CHCs are playing in training physicians, the ACA creates a $230 million grant program to fund the development of residency programs at CHCs. Having residents train in CHCs will help create an expanded pipeline of new doctors trained at, and ultimately working for, CHCs.


CHCs and the ACA’s Medicaid Expansion

The Medicaid expansion provisions are highly controversial. Only the individual mandate is more contentious. However, the Medicaid expansion provisions are critical for CHCs. No provision of the law will have a larger or more lasting impact.

While the Supreme Court’s June 2012 ruling upheld the validity of the penalty for individuals who do not obtain health insurance, the Court viewed the proposed Medicaid expansion as coercive in that it threatened states with loss of existing federal funding. This ruling leaves the ACA’s Medicaid expansion up to individual states.

Medicaid is a jointly funded federal/state health insurance program for the poor that assists children, pregnant women, the elderly, and the disabled. An individual state’s federal matching rate of funding depends on overall need. In 2012, no state’s federal match was less than 50 percent, with high-poverty states having federal rates as high as 72 percent (i.e., 72 percent of their Medicaid funding was federal and 28 percent came from the state).

Under the ACA, states that increase Medicaid income eligibility levels to 133 percent of the federal poverty level will have the cost of expansion covered 100 percent by the federal government for three years beginning in 2014. The 100 percent match will decrease after the first three years; in 2017, the federal government will pay 95 percent of the cost, and in 2020, the federal government will cover 90 percent. It is estimated that if all states participated, another 16 million Americans would have health insurance.

In a state like Kansas, current Medicaid income eligibility for nondisabled adults is 32 percent of the federal poverty level, or $3,574 in earnings annually for a single individual, which is the fifth lowest in the country. An expansion of Medicaid to 133 percent of the federal poverty level would mean that an estimated 130,000 Kansans would be covered—Kansans who are now uninsured and largely seeking their medical care, if they are receiving any at all, in CHCs.

For our Center in particular, a Medicaid expansion would mean that about 66 percent of our patients would, by 2014, be eligible for Medicaid. Our staff would then face fewer challenges getting patients into care with specialists. Hospital stays would no longer be written off as charity care. It would mean that we would be paid our cost for delivering care to these patients, as opposed to the $10 fee we currently receive, allowing us to free up additional resources to hire more staff, expand our facilities, and deliver care to more people in need. The story is the same with the CHCs in your community and across the country.

If the provisions of the ACA remain in force and if each state participates in the ACA’s Medicaid expansion options (as states are increasingly opting to do, it seems), by 2015, CHCs are expected to care for more than 40 million patients, save $122 billion in overall healthcare system costs, generate $54 billion in economic activity, and create 284,000 jobs in the communities they serve.

CHCs and Seniors

In 2011, nearly 1.4 million seniors (about seven percent of the national total) were CHC patients, up from 400,000 in 2006. That number is expected to more than double by 2015. And, while seniors have not historically been the largest age cohort cared for by CHCs (58 percent of patients are ages 20–64), the baby boom generation will quickly begin to change the face of CHCs.

CHCs are a great place for seniors to receive care. As outlined above, CHCs provide integrated health care that is accessible to everyone. What this means for seniors is that medical, dental, and mental health services are often offered in the same location, thus reducing the number of trips to healthcare providers. Further, because Medicare offers no dental coverage, CHCs offer a great way for seniors to continue to maintain oral health without breaking the bank. CHCs also offer affordable access to medication through the federal 340B Drug Pricing Program, which makes prescription drugs available to CHC patients at the lowest prices in the county. CHCs also offer support services to patients (they help patients navigate Medicare Part D, for example), which is a tremendous relief for many.

In our Center, we have had longstanding patients cry when they thought they would have to go elsewhere for care after they became Medicare eligible. And they’ve cried again when we reassured them that they could continue to come to our Center, no matter their insurance status. CHCs are medical homes for patients of all ages. Becoming eligible for Medicare after years of being uninsured shouldn’t force patients to lose their medical home. And at CHCs, they don’t have to.

CHCs: How You Can Help

There are CHCs in all 50 states, the District of Columbia, and in U.S. territories, so no matter where you are, there likely is one nearby. To search for the one nearest you, visit http://findahealthcenter.hrsa.gov.

There are many ways for lawyers to get involved in supporting the important work of CHCs.

  • CHCs all need legal counsel and really appreciate that counsel being provided pro bono. Our Center benefits greatly from the services of Ms. Martie Ross of Pershing Yoakley & Associates in Kansas City, and we are grateful for her time and talents.
  • You can also consider serving on the governing board of your local CHC. The healthcare environment is growing increasingly complex, and having a good legal mind on the board helps a CHC navigate, limits liability and exposure, and improves overall governance.
  • Most every CHC is a 501(c)(3) nonprofit organization (although some are local government entities) and would welcome a financial contribution.
  • And remember, CHCs welcome all patients regardless of income. If you are in need of health care, visit your local CHC. You’ll be glad you did.

For more than 45 years, CHCs have been providing high quality, affordable, and accessible health care to all individuals regardless of ability to pay. From the very first health center founded in 1965 to the more than 8,000 CHC sites today that provide medical, dental, and behavioral care to more than 20 million patients, CHCs have proven themselves to be the best tool we have to address the needs of access to health care for all Americans. Please help spread the word. It may reinforce the fragile truce that exists on the CHC front in the ACA wars—and that would serve our country well.

Jason Wesco

Jason Wesco (jwesco@hpcjc.com) is president and CEO of Health Partnership Clinic, a Community Health Center with sites in Olathe, Overland Park, and Paola, Kansas. For the past 10 years, he has worked at the state and local level to expand access to health care for all Kansans.