Advocates make the case for expansion of CHC system
Report: Community health centers deliver
Although no single initiative can effectively blunt spiraling healthcare costs in this country, at least some policymakers believe that a significant expansion in the network of federally supported community health centers (CHC) could not only save the country as much as $40 billion in medical expenditures annually, but also provide access to care for 30 million Americans by 2015.
That, at least, is the contention of a new report issued by the Washington, DC–based National Association of Community Health Centers (NACHC) and the Robert Graham Center of the American Academy of Family Physicians, in conjunction with Bethesda, MD–based Capital Link.
The report, Access Granted: The Primary Care Payoff, suggests that medical costs for patients who get most of their care through CHCs are as much as 41% lower than for patients who get most of their care elsewhere, according to 2004 data derived from the Medical Expenditure Panel Survey (MEPS), which was analyzed by investigators from the Robert Graham Center.
This represents per-person savings in the amount of $1,810 annually, or overall savings to the healthcare system of $9.9 billion to $17.6 billion per year, according to the report.
As a result of these findings, NACHC is urging legislators to increase federal support for CHCs from the current $2 billion per year to $5 billion annually.
Primary care is the key
Critical to the success of the CHC concept is its emphasis on delivering primary, preventive care, says Virgilio Licona, MD, a family physician at Plan de Salud del Valle, Inc., a CHC that serves communities in eastern Colorado. Licona discussed the report’s findings at an August 6 news conference in Washington, DC. “The dollars we are talking about in terms of savings are accrued by using a family-centered, medical home [model] which is the basis for primary care in community health centers,” said Licona, adding that many of the CHCs offer dental care and behavioral health as well as basic preventive care all under the same roof. “When you combine these things in an integrated fashion the way we do in our CHC in Colorado, you are able to look at issues before they become problematic in some cases, and when they do become problematic, you can really focus on what you need to do to turn those things around.”
Although many prominent healthcare organizations—including the American Academy of Pediatrics, the American Academy of Family Physicians, and the American College of Physicians—support the medical home concept, Licona pointed out that unlike many other industrialized nations, the larger healthcare delivery system in this country does not have a primary care base. Consequently, he noted that the approach utilized by the CHCs is unique in that regard. “This study really validates the importance of [establishing primary care as a basis for healthcare delivery], not only for the quality of care that we are able to provide daily, but more importantly for the dollars that we can save,” said Licona. “It is validating what we are doing in economic terms, which I believe is the language we need to be speaking if we are to affect policymakers in terms of redirecting our system.”
Given that the report’s findings suggest that regular primary care can head off ER visits, hospital admissions, and other expensive medical events, it stands to reason that extending primary care to more Americans makes good economic sense, explained Dan Hawkins, policy director for NACHC. “Nearly one in every five Americans . . . has no regular source of primary care,” he said, noting that the CHCs keep these numbers from being even greater. “Community health centers saved the health system—both public and private payers—between $10 billion and $17 billion dollars last year alone, and those savings could grow to more than $40 billion by 2015 if Congress is willing to invest the dollars needed to expand CHCs to serve 30 million people by then.”
CHCs offer economic dividends
The report also makes that case that on top of the savings accrued from primary and preventive care, CHCs also serve as economic engines for the mostly low-income communities in which they are located. To assess this impact, analysts from Capital Link looked at the CHCs’ direct economic effect on their communities, their indirect effect, and what Capital Link refers to as their induced effect, explained Allison Coleman, CEO of Capital Link.
As far as direct effect is concerned, Coleman noted that the 950 CHCs operating in 2005 injected nearly $7.3 billion into their communities simply through their operations and directly employed about 90,000 full-time employees. In addition, Coleman noted that the CHCs indirectly contributed another $1.1 billion by purchasing goods and services from other businesses in their communities.
Coleman also pointed out the induced effect, referring to the economic activity that occurs when employees of the CHCs buy groceries, pay rent, and purchase other goods and services in their communities. “These expenditures generated almost $4.2 billion in induced economic activity,” she said.
When all three economic dimensions are considered, Coleman said that the CHCs contributed a total of $12.6 billion and produced 143,000 jobs in 2005.
Big obstacles remain
Senator Orrin Hatch (R-UT) and Senator Ted Kennedy (D-MA) are cosponsoring a bill that would reauthorize funding for CHCs with the spending targets advocated by NACHC, and a similar bill is pending in the House. However, even with passage of the legislation, it’s clear that additional steps are needed to expand the reach of CHCs in the way that NACHC envisions.
For example, the report points out that both NACHC and Capital Link surveys indicate that many CHCs operate in buildings that are outdated, yet new construction or remodeling cannot be funded through federal grant dollars.
Further, additional funds are needed for technical improvements such as implementation of electronic medical records and other innovations that can facilitate basic DM tasks.
However, the NSCHC report acknowledges that the biggest challenge to overcome in expanding the reach of CHCs may well be the continuing shortage of PCPs. To that end, NACHC intends to focus exclusively on this issue in an upcoming report.
- Primary Care Docs Average More Hospital Revenue Than Specialists
- How Chargemaster Data May Affect Hospital Revenue
- $6.4B Henry Ford, Beaumont Merger Failed on Cultural Hurdles
- House Lawmakers Grill CMS Over Health Exchange Navigators
- Fortunately, Angelina Jolie Isn't On Medicare
- ED Physicians Key to Half of Hospital Admissions
- Don't Let Nurses Sink Your Bottom Line
- Insurer's App Aims to Lower Healthcare Costs, Securely
- 69% of Employers Plan to Offer Healthcare Coverage After 2014
- Q&A: Catholic Health Initiatives' New Senior VP for Capital Finance