Community Health Centers Face Obamacare Funding Limbo

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By Victoria Pelham

Community health centers are feeling the pressure as an Obamacare-created fund for the clinics is set to expire Sept. 30—with no plan set to preserve the funding.

The health-care providers are growing more and more worried each day, Dan Hawkins, senior vice president for public policy and research at the National Association of Community Health Centers, said. Because of the health centers’ annual funding cycle, they are not in immediate danger of closing their doors if Congress doesn’t act this week, he told Bloomberg BNA. But they already have to figure out how to handle multiyear contract deadlines for facilities and doctors given uncertain budgets. And they must determine how to keep limited staff they can’t afford to lose or replace, as well as to keep recruiting new ones.

"[Community health centers] may be nonprofit, but they’re businesses—small businesses—and as businesses, they have to stay afloat,” Hawkins said. “In order to do that they have to know, or have a good feel at least, on where they stand revenue-wise going forward. That’s the crux of the dilemma.”

Community health centers offer care to 24.3 million patients in medically underserved, rural, and inner-city communities, according to the Kaiser Family Foundation. And the centers rely on the ACA’s allotments—which were renewed in the 2015 Medicare Access and CHIP Reauthorization Act—for more than 70 percent of total grant funding. Without a congressional reauthorization, the Trump administration estimates 2,800 health centers could close, leaving 9 million patients without health-care access, the NACHC points out.

Legislation Unlikely to Meet Deadline

Hawkins said lawmakers will move to protect the dollars, likely for a two-year time frame. But he added they’re struggling to find cost offsets that would need to be around $3.6 billion per year. And Congress remains mired in Affordable Care Act repeal-and-replace debates, taking away time and attention from the issue, he said.

It’s unlikely lawmakers will be able to come up with a solution before the funding cliff, he added. Consideration of a health-care proposal from Republican Sens. Bill Cassidy (La.), Lindsey Graham (S.C.), Dean Heller (Nev.), and Ron Johnson (Wis.) will mean a probable delay. That controversial repeal-and-replace bill also has a Sept. 30 cut-off for passage through a budget reconciliation vehicle.

But NACHC leaders met with House Energy and Commerce Chairman Greg Walden (R-Ore.) Sept. 25 and have been in discussions on the Hill about the community health center funding. They have been told a plan could come forward during the first week in October, because the federal government will have to start determining grant distributions by mid-November for 2018.

“It comes up quicker than people anticipate,” Hawkins said.

House lawmakers in mid-September introduced the Community Health Investment, Modernization and Excellence (CHIME) Act of 2017, which would continue the fund for five years. Proposed by Reps. Elise Stefanik (R-N.Y.), Tom O’Halleran (D-Ariz.), David Young (R-Iowa) and Joe Courtney (D-Conn.), the bill has garnered growing support and now has around 80 co-sponsors, according to Hawkins and the NACHC.

It’s uncertain if an extension would move through that bill or another, he added.

It’s more likely that a renewal of the Community Health Center Fund would be tacked on as part of a larger package of health-care programs needing action, health-care consultant John Feore said, such as the Children’s Health Insurance Program and cuts to Medicaid disproportionate share hospital payments that hospitals are seeking to delay.

Feore, a director at consultant Avalere Health, told Bloomberg BNA the program is popular and bipartisan, and there’s an “understanding something needs to be done and done quickly.” But efforts are held up by the larger health-care landscape as ACA repeal-and-replace is in the fore, and there’s a limited amount of time for votes.

Still, he added that Congress would try again in October even if lawmakers miss the funding cliff at the end of September and attempt to make the plan retroactive.

“After the ACA repeal... is debated and ultimately voted on [and] whether it’s approved or not, there’s other priorities Congress wants to address,” he said. “There’s probably a better chance to pass health-care legislation if it’s multiple popular pieces lumped together into one bill as opposed to having continuous health-care votes that could always stray into the ACA repeal debate.

“There’s always the potential for a health-care debate to get lumped into the ACA, and when that happens, you can lose any bipartisan momentum.”

More than 70 senators on both sides of the aisle also called in late September on the Senate Health, Education, Labor and Pensions Committee to take action on the deadline, the NACHC said, warning that health centers are already facing “disruptive effects of the uncertainty” like hiring freezes.

“They’re having to develop contingency plans to figure out how they’ll respond and that may involve planning around not getting any funding or having the funding delayed,” Feore said. “Even a funding delay is going to put a certain amount of financial pressure on these health centers.”

Safety-Net Uncertainty

The pressure on clinics is compounded by the larger safety net being in limbo.

Without reauthorization, CHIP is also slated to expire Sept. 30. And a recent plan in the Senate Finance Committee to renew the program, which covers nearly 9 million kids, for five years has been stalled by congressional debate over the Graham-Cassidy bill. States would begin losing money by December, with most running out of CHIP funds by March without a congressional bill.

Graham-Cassidy also would dramatically change the funding structure for the Medicaid program for the poor by placing a per-enrollee cap on spending. Additionally, it would end the Medicaid expansion and re-funnel those dollars into a block grant to states. KFF projects that, if passed, the GOP plan would drop federal funding by $160 billion through 2026.

Community health centers are directly in the crossfires of these programs. The clinics offered primary care to nearly one in six Medicaid beneficiaries in 2015, according to the Kaiser Family Foundation, and the NACHC figures show Medicaid and CHIP patients make up 47 percent of all community health center patients.

“If those folks were to lose that coverage, the health centers would still have at least the moral obligation if not legal obligation to provide care for those individuals, but without resources and [would] not be able to afford staff and other costs related to providing care,” Hawkins said.

To contact the reporter on this story: Victoria Pelham in Washington at

To contact the editor responsible for this story: Brian Broderick at

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