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For Immediate Release: Friday, March 14, 2008
Contact: CMS Office of Public Affairs


National Association of Community Health Centers’

33rd Annual Policy and Issues Forum

March 14, 2008


HealthCentersand CMS:

 Working Together to Expand Access to Care


It’s good to be here at the National Association of Community Health Centers’ 33rd Annual Policy and Issues Forum. 


I want to start off by congratulating you.  The Department of Health and Human Services and NACHC recently reached a milestone together: 1200 new and expanded community health centers.  Throughout my 10 years in the HHS budget office, I’d been working to achieve that goal. 


We’re proud you’ve been our partners on so many initiatives, including the National Medicare Education Program, the National Partnership on Medicare Field Strategy, and last summer’s preventive services tour with the Medicare bus.



I also want acknowledge your work with us and the Health Resources and Services Administration under the able leadership of Dr. Duke. 


It has been our good fortune to have you and HRSA as partners as we’ve worked to identify and enroll eligible Medicare beneficiaries in the low-income prescription drug subsidy. HRSA pinpointed the top 100 counties and zip codes of low income people who had enrolled in the LIS.  Five hundred community health centers serving Medicare beneficiaries in those areas stepped forward.


Since health centers do not provide benefits counseling, HRSA connected you—the health centers—with the Aging Services Networks in your communities who do.  HRSA encouraged the Aging Services Networks to get in touch with health centers.  Over the past three years, all parties have nurtured a successful working relationship.  Many more Medicare beneficiaries who need this extra help have enrolled.


We are as committed to this outreach as we ever were and we continue to need your help.  So I hope that those of you who have not connected with the Aging Services Networks and their benefits counselors will reach out when you get back home.  Everyone who needs help affording their medications should be able to take advantage of this important coverage.  The community health centers’ support has been invaluable. 



Community health centers have been of, by, and for the community for more than 40 years.  Members of the community populate your boards. You provide comprehensive health care services regardless of income or insurance status. You’re the primary care anchor in the communities you serve.


The services you provide—comprehensive care, including physical, mental,

dental, and preventive care—are key to cost-efficient, high-value health care. 


Your own website calculates that by helping patients avoid emergency rooms and making better use of preventive services, community health centers save the country between $9.9 billion and $17.6 billion a year in health costs.



This is not small change under any circumstances, but absolutely critical now with a crisis in health care financing looming on the horizon.  


According to the Medicare actuaries’ health expenditures report, in 2007, we spent a little over $2 trillion on health care.  By 2017, the health share of gross domestic product is expected to double, when we’ll spend almost $1 out of every $5 on health care.


The Medicare Trustees warn us every year that we’re heading toward insolvency of Medicare’s Hospital Insurance Trust Fund. They’ve said it’s as soon as 2019—11 years from now.  If you’re 54 years old today, there will be no reserves in the program’s hospital fund by the time you’re eligible for Medicare.


Current Medicare beneficiaries don’t have wait that long: In just two years, Medicare will eat up 34 percent of an average monthly Social Security check.


Every American will feel the impact as the cost of Medicare begins to consume greater shares of funds reserved for other priorities.  Health care will be less accessible, and more expensive, as a result.



That is, unless we can start getting better value for our health care dollars now.


Medicare is a good example.  For 40 years, Medicare has doggedly focused on paying the bills for basic health services. But we ought to be paying for care that promotes health, prevents complications, and keeps health care costs down. 


This sounds pretty intuitive.  It’s what you do in community health centers.  Yet it’s not the way that health care payments usually work today. Instead, if patients experience complications, or they receive duplicative or ineffective treatments, we all end up paying more.


So Medicare is working to achieve higher quality health care at lower cost by paying for care we value—the care that all of you work hard to provide every day. 


We’re calling this effort value-based purchasing.  The basic idea is: You get what you pay for. 


At CMS, we see a real possibility for real reform by collaborating with the professionals, consumers and public officials who are working for quality health care. A critical mass of policy leaders, Congress, health plans, business and labor, and providers working with patients, seem to agree. 



All of these interests have worked with us to develop objective benchmarks.

We’d like the community health centers to join us at the table.  We stand to learn a lot from your joining hospitals, physicians and many other sectors to develop additional quality measures.  We could gain so much from your experience providing comprehensive, coordinated care.



In 2006, Medicare provided health insurance coverage to 43.2 million people.  Twenty-three percent of them had 5-plus chronic conditions that accounted for 68 percent of Medicare spending.  Over the course of the year, they saw an average of 13 physicians and filled 50 prescriptions, not counting the diagnostic and other services they received.


Wouldn’t everyone be better off if this care were coordinated?  Many doctors— including the American Academy of Family Physicians, the American Academy of Pediatrics, the American College of Physicians and the American Osteopathic Association—think patients would receive better care. 


CMS has evidence from our own programs.  The Everett Clinic in Everett, Washington—part of our Physician Group Practice Demonstration—is showing us that quality can be raised visibly with a change as simple as having a doctor check in 10 days after hospital discharge to address any unsolved or new health problems. 


The clinic also uses hospital coaching to guide patients and caretakers through complicated care procedures both while the patient is in the hospital and after a patient leaves. 


The significance of primary care is backed up by a study, released just last month by the American Journal of Medicine.  It found, as the proportion of primary care practice increases in communities, inpatient hospitalizations, emergency department visits, and total surgeries decrease. 


Comprehensive coordinated care might save money as well.  Medicare Part B reimbursements have been shown to be lower for counties with a greater supply of primary care providers. 


All of these are reasons the concept of a “medical home” has taken on new energy recently.  And medical homes are what community health centers do.


Right now we are beginning to put together a demonstration program examining exactly how a medical home could provide people with Medicare better health care at lower cost.  This demonstration was actually a 3-year project authorized by the Tax Relief and Health Care Act in 2006, for rural, urban and underserved areas in up to 8 states.


Under this demonstration project, a board-certified physician will provide comprehensive and coordinated care as the “personal physician” to Medicare beneficiaries with multiple chronic illnesses.  The doctors selected will receive a care management fee, in addition to whatever Medicare covered services they may provide. Payment would be based on Medicare’s physician relative value scale.


We’re expecting the project to go live in January of 2009.  Even though community health centers are on a different payment system, I wanted call your attention to it early.   I hope you’ll give us feedback.  Additional information about the demonstration is on the CMS website.



Another initiative where we’d appreciate your input:  the new electronic health records demonstration program.


Electronic records are second nature today.  Many of you here have a blackberry.  You’ve stopped at an ATM—doesn’t matter which bank—when you’ve needed cash.  When you pay for your groceries, the cashier checks the price with a barcode scanner, and if you bought groceries at your local Costco, the Costco here in the Washington area could tell you if you bought grapes last week. 


Health IT is an enabler for value in health care.  The efficiencies that EHRs create show great promise in reducing costs because they mean less duplication of work.  They allow doctors to spend more time with patients.  They can reduce the chance of a medical error.  The Institute of Medicine has estimated that over 1.5 million Americans are killed every year by prescribing errors—more than highway accidents, breast cancer or AIDS. 


The demonstration targets small and mid-sized practices, where doctors still depend on paper files, handwritten prescriptions and patient charts.  Right now, we’re looking for 12 communities across the country to bring together a broad cross-section of local leadership, leverage resources, and recruit small and medium-sized physicians’ practices. 


Even though you may not be technically eligible for incentives, I encourage you to elbow your way to the table.  Community health centers are critical community partners who can help make the case for EHRs, and you need to be part of the discussion. 



Before I wrap up, I want to mention one last important issue.  The National Provider Identifier goes live on May 23.  Right now you can submit claims with your legacy identifier and your NPI.  If this is working for you, please start submitting small batches of claims with the NPI only.  Moreover, when the Provider Enrollment Chain and Ownership System—PECOS—goes live later this year, you will also be able to review and update Medicare enrollment information more easily.




Now, if you listened closely over the last 20 minutes, you’ll know that I gave you three assignments: 


  • Help us with feedback for the upcoming demonstration that will teach us how to structure a medical home.
  • Help us jump start an interoperable network for EHRs.
  • And finally, continue to work with us on identifying and enrolling the people who still aren’t taking advantage of the low income subsidy to help them pay for their prescription drugs.


There’s a reason the President designated one of the few increases in his 2009 budget for community health centers.  It’s because community health centers deliver real value for the care that you provide. 


We’ve appreciated this strong working relationship over the years.  Thanks for the opportunity to be here today.




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