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Health Centers: America's Primary  Care Safety Net Reflection on Success, 2002-2005 Health Resources & Services Administration US Department of Health and Human Services

The Health Center Model of Care

Health centers build on and complement other Federal and non-Federal health service efforts and fill major gaps where there are no existing programs or resources. For example, while the Federal Government and States broaden access to health care through financing streams such as Medicaid, Medicare, and SCHIP, health centers ensure access to a comprehensive and regular source of care for the populations covered by these funding streams. This is of particular importance during a time when the proportion of physicians serving existing Medicaid and uninsured patients and those willing to accept new Medicaid or uninsured patients has continued to decline. Accordingly, over 45 percent of health center patients are Medicaid, Medicare, SCHIP, or other public insurance beneficiaries and nearly 40 percent are uninsured.

As funding and eligibility for health center services are not tied to individual patient characteristics (e.g., women or infants) or specific health conditions (e.g., diabetes or HIV/AIDS), health centers have the unique ability to reach certain underserved populations often excluded from existing Federal, State, or private sector health funding streams such as non-elderly, non-disabled, low-income men.

Health Center Financing

Financing and revenue sources play a key role in the ability of health centers to address their goals of increasing access, improving quality, and reducing health disparities.

Health centers rely on a number of revenue sources. The major source for all health centers is Medicaid with over one-third of health center revenue coming from the program.

  • About one-fifth (19 percent) of health center revenue comes from the Federal health center grant.
  • Remaining funding comes from: State, local, and philanthropic organizations; other third party sources, sliding fee schedules, and Medicare; as well as other Federal programs or payors.

Given this mix of funding and revenue sources, it is imperative that health centers continue to coordinate and collaborate with payors at Federal, State, and local levels to continuously demonstrate their value and role in increasing access and eliminating disparities as health care homes.

Is Health Center Care Free? While all health centers and FQHC Look-Alikes must provide access to services without regard for a person’s ability to pay, services are not free. Rather, each health center has a set schedule of fees and corresponding discounts—often referred to as a “sliding fee scale” for the services they provide. The sliding fee scale is based on a patient’s ability to pay, as determined by annual income and family size according to the most recent Federal poverty guidelines. In order to remain financially viable and competitive in their local marketplace and to help improve access to care, health centers also assist patients with screening and enrollment into all available public and private insurance programs such as Medicaid, Medicare, and SCHIP. Health centers must always ensure that billing for patients without insurance, collection of copayments and fees, and screening for financial status, is done in a culturally appropriate manner to ensure that these steps do not present a barrier to care. How does the sliding fee scale work? All patients whose annual individual and/or family income is below 200 percent of the poverty guidelines are eligible for discounts on the care they receive.

  • Patients whose incomes fall below 100 percent of the poverty guidelines receive care at no cost or for a small fee.
  • Patients whose incomes fall between 100 and 200 percent of the poverty guidelines pay some portion or percent of the care received, the amount or percentage is determined through policy set by the health center’s governing board.

Health Center Performance

Health center data, peer reviewed literature, and major reports continue to document that health centers successfully increase access to care, promote quality and cost-effective care, eliminate health disparities and improve patient outcomes, especially for traditionally underserved populations.

Prenatal Care and Birth Outcomes

Identifying maternal disease and risks for complications of pregnancy or birth during the first trimester helps improve birth outcomes. By monitoring timely entry into prenatal care, the Health Center Program can assess both quality of care as well as health center outreach efforts.

Results over the past few years demonstrate improved performance as the percentage of pregnant health center patients that began prenatal care in the first trimester grew from 60.7 percent in 2001 to over 64 percent in 2006.

Appropriate prenatal care management can also have a significant effect on the incidence of low birthweight (LBW), the risk factor most closely associated with neonatal mortality. Monitoring birthweight rates reflects both on quality of care and health outcomes for health center women of childbearing age, a key group served by the Program.

When compared to the national rate, health centers demonstrate impressive performance. In 2005, 7.3 percent of health center patients had LBW infants, a rate that was 11 percent lower than seen nationally (8.2 percent, 2005 national LBW rate). Overall, between 2001 and 2006, health center LBW rates have continued to follow a steady pattern at about 7 percent, more than 7 to 13 percent lower than national rates which have continued to rise.10

Table 6. Improving Health Outcomes: Timely Entry into Prenatal Care at Health Centers, 2001-2006

2001 2002 2003 2004 2005 2006
Percentage of Health Center Patients Served Starting Prenatal Care in First Trimester 60.7% 60.1% 62.2% 63.3% 63.4% 64.2%

Source: U.S. Department of Health and Human Services, Health Resources and Services Administration, Bureau of Primary Health Care. Uniform Data System. Rockville, Maryland: U.S. Department of Health and Human Services, 2004-2006.

Figure 3. Reducing Health Disparities: Health Center African-American and Hispanic/Latino Low Birthweight Rates, Consistently Below U.S. Rates, 2001-2006

Figure 3, Line chart showing Health Center African-American and Hispanic/Latino birthweight rates, consistently below U.S. Rates, 2001-2006


Source: U.S. Department of Health and Human Services, Health Resources and Services Administration, Bureau of Primary Health Care. Uniform Data System. Rockville, Maryland: U.S. Department of Health and Human Services, 2001-2006.

Source: Hamilton BE, Martin JA, Ventura SJ. Births: Preliminary Data for 2006. National vital statistics reports; vol 56 no 7. Hyattsville, MD: National Center for Health Statistics. 2007.

Source: Martin JA, Hamilton BE, Sutton PD, Ventura SJ, Menacker F, Kirmeyer S, Munson ML. Births: Final data for 2005. National vital statistics reports; vol. 56 no. 6. Hyattsville, MD: National Center for Health Statistics. 2007.

It should also be noted that health centers serve a higher risk prenatal population than seen nationally, making progress on these performance indicators a particular accomplishment.

Health Centers Rated Among Top Federal Programs. A 2007 Office of Management and Budget review tool used to assess all Federal programs awarded health centers the highest possible rating of Effective—a ranking achieved by only 19 percent of all programs.11 Key findings include tha the Health Center Program:

  • Effectively extends access and delivering high quality health care to underserved populations;
  • Demonstrates progress in meeting long-term and short- term performance goals; and
  • Effectively collaborates with other programs that share common goals.

Chronic Disease

Health center patients, including low-income individuals, racial/ethnic minority groups, and persons who are uninsured, are more likely to suffer from chronic diseases such as hypertension and diabetes. Clinical evidence indicates that access to appropriate care can improve the health status of patients with chronic diseases and thus reduce or eliminate health disparities.

Controlling blood pressure (hypertension) can reduce the health risk associated with conditions such as heart disease and stroke. However, with increasing rates of hypertension, effective control is a particularly ambitious undertaking as improvements in such a chronic condition often requires treatment with both lifestyle modifications, usually as the first step, and, if needed, with medications. According to the Centers for Disease Control and Prevention (CDC) data for 2004, only 36 percent of adults nationally demonstrated adequate high blood pressure control while health center patients far exceeded the national rate at 44.4 percent of patients with blood pressure under control.12, 13

Promoting Efficiency

Health centers have a demonstrated track record in providing cost-effective services. Health centers continue to maximize the number of patients served per dollar while keeping cost increases below annual national health care cost increases. In 2005, the average cost per patient served at health centers grew by only 2.1 percent. In 2006, costs grew at a slightly higher rate (4.6 percent), but were still about 33 percent below the 6.8 percent projected growth rate for national health expenditures. In fact, over the past 4 years, cost increases at health centers have been at least 20 percent below national cost increases.14 By restraining increases in the cost per individual served at health centers below the national per capita health care cost increases, the Program has been able to serve more patients that otherwise would have required significant additional funding to serve annually elsewhere.

Success in achieving cost-effectiveness may in part be related to health centers’ use of a interdisciplinary team that treats the “whole patient.” This, in turn, is associated with the delivery of high quality, culturally competent, and comprehensive primary and health care services that not only increases access and eliminate health disparities, but promotes more effective care for health center patients.

External Evaluation

In addition to internal monitoring of health center performance, peer reviewed literature and major reports continue to document that health centers successfully increase access to care, promote quality and cost-effective care, and improve patient outcomes, especially for traditionally underserved populations.

  • Health center uninsured patients are more likely to have a usual source of care than the uninsured nationally (98 percent versus 75 percent).15, 16
  • Health centers provide continuous and high quality primary care and reduce the use of costlier providers of care, such as emergency departments and hospitals.17
  • Uninsured people living within close proximity to a health center are less likely to have an unmet medical need.18
  • Health centers have demonstrated success in chronic disease management. A high proportion of health center patients receive appropriate diabetes care.19
  • Medicaid beneficiaries receiving care from a health center were less likely to be hospitalized than Medicaid beneficiaries receiving care elsewhere.20
  • Health center Medicaid patients were 11 percent less likely to be inappropriately hospitalized and 19 percent less likely to visit the emergency room inappropriately than Medicaid beneficiaries who had another provider as their usual source of care.21
  • Health centers have been found to improve patient outcomes and reduce racial and ethnic disparities in health care.22, 23, 24
  • Health center low birthweight rates continue to be lower than national averages for all infants. In particular, the health center low birthweight for African-American patients is lower than the rate observed among African-Americans nationally (10.7 percent versus 14.9 percent respectively).25
  • Health center patient rates of blood pressure control were better than rates in hospital affiliated clinics, the U.S. Department of Veterans Affairs health system, or in commercial managed care populations.26

next page > Sustaining the Connections

Health center physician
Health Centers:
A Coordinated Effort and Investment

Health centers must:

  • Coordinate and collaborate appropriately with other health care and social service providers in their area to ensure the most effective use of limited health resources and to provide access to the most comprehensive array of services and critical assistance including, housing, food, and job support.
  • Maximize all sources of revenue, including non-grant resources.