Like all those competing for a piece of the healthcare budget pie, community health centers would like to see more federal funding next year as they try to meet growing demand and, in some cases, face new government-imposed obligations.
Community health centers, which operate in "high-need areas," have been a priority of the Bush administration, which views them as an important part of expanding access to the uninsured and other vulnerable populations (Jan. 13, 2003, p. 26).
In 2004, Bush and Congress set aside $1.6 billion for community health centers, a $113 million increase over 2003. In his proposed 2005 budget, Bush requested a $219 million increase.
Advocates for the health centers have been elated about the new federal support but are also expressing disappointment with some of the results. So far this year, only 15 of 87 applications for new community health centers have been funded, according to the National Association of Community Health Centers.
Against that backdrop, the health centers say they are shouldering an ever-growing burden. In 2003, the number of uninsured patients served at health centers increased 11%; some health centers serve populations in which 73% of patients have no insurance, according to a report the NACHC released last week.
For hospitals, funding for the health centers could prove to be an important part of reducing their uncompensated-care costs. According to the NACHC's study, if patients treated in emergency rooms for noncritical conditions were instead treated at a health center, hospitals and the healthcare system overall would save between $1.6 billion and $8 billion annually.
"Every dollar spent on community health centers comes back threefold," said M. Monica Sweeney, vice president of medical affairs at the Bedford Stuyvesant Family Health Center in Brooklyn, N.Y., where "we're bursting at the seams" with patients.
"Of course (community health centers) should be fully funded, but we shouldn't play the game of taking money from hospitals or not funding health centers as a proxy for giving hospitals a little more money," said Richard Wade, a spokesman for the American Hospital Association. When lawmakers revisit payment cuts like those made in the Balanced Budget Act of 1997, he said, "It's going to be important for all pieces of the healthcare system to stand together."
Hospital officials, Wade said, largely support community health centers. The NACHC's report might show why: It found that in medically underserved areas with a community health center, preventable hospitalizations decline by 5.8 per 1,000 people compared with areas that do not have a health center. By giving patients a regular source of care, health centers can prevent them from seeking treatment in the emergency department and offloading that expense to hospitals, supporters argue.
"We are a model that helps prevent hospitalizations," said Nancy Stern, chief executive officer of Eastern Shore Rural Health System, Nassawadox, Va., which operates six health centers.
Health centers in some states are under new pressure to do even more. In Massachusetts, a regulation proposed last year by the state's Division of Health Care Finance and Policy would cut payments to hospitals for the primary-care services they provide starting next year. Instead, community health centers would be expected to treat those patients. Hospitals that are farther than 15 miles from a health center would be exempt from the rules, but officials in the state are still concerned about possible implications.
"There are a lot of problems with (the proposal) and we think it's important not to play around with patient-care access for this population because you can really end up hurting people," said Joe Kirkpatrick, vice president of healthcare finance at the Massachusetts Hospital Association.
For instance, physicians who are accustomed to treating patients in a hospital outpatient department will have to find alternative sources of payment for some of those services or simply stop providing them. The proposed regulation is part of the state's annual funding of its uncompensated-care pool, which reimburses providers for the free care they deliver (Oct. 28, 2002, p. 26).
Some Massachusetts lawmakers, including Democratic state Sen. Richard Moore, have said the benefit of the proposal might not justify the difficulty of implementing it. Moore and others are asking the state healthcare finance and policy division to delay the proposed regulation until June 2006 so the matter can be studied more closely before proceeding, according to Moore's spokeswoman.
Under the proposed regulation, she said, hospitals would have difficulty determining which outpatient services are covered, and caregivers could inadvertently run afoul of laws like the Emergency Medical Treatment and Active Labor Act, which requires emergency departments to screen and stabilize all patients.
State officials have yet to release details on the services that will be subject to new payment restrictions. As a result, Kirkpatrick said, it is difficult to assess how the proposed regulation would affect Massachusetts hospitals' finances.
Overall, Massachusetts will save no more than $2 million annually as a result of shifting primary-care payments to health centers, according to Health Care For All, a Boston-based consumer advocacy group.
As the Massachusetts situation plays out, community health center advocates are hopeful that the recent federal funding promises will soon catch up with providers' needs. With only 15 new health centers receiving funds this year, any others approved to open their doors won't get money until at least 2005, according to the NACHC.
In 2003, 100 new centers opened. So far this year, 63 have opened and 66 have received grants to expand their medical capacity.
"Health centers hold a unique front-row seat to what's going on in healthcare," Dan Hawkins, the NACHC's vice president of policy, said at a news conference last week. Hawkins and others argued that hospitals benefit from health centers, especially when activities of the two are coordinated to ensure patients receive care in the best possible setting.