America’s Voice for Community Health Care

2. America’s Voice for Community Health Care The NACHC Mission To promote the provision of high quality, comprehensive and affordable health care that is coordinated, culturally and linguistically competent, and community directed for all medically underserved people.

3. A Tale of Two Years Presentation to Bi-state Primary Care Association 25th Anniversary Primary Care Conference Dan Hawkins National Association of Community Health Centers May 16, 2011

4. Last Year: Health Reform!

5. Health Reform: What Was it About? • Expanded coverage for the very people & communities served by CHCs, AND – • Guaranteed funding to expand CHCs & the NHSC to reach 40 million by 2015 =PLUS= • Changes designed to revitalize Primary Care (THCs, Training, Payment Improvements) and Promote Integrated Care for Better Quality & Lower Costs

6. Health Center Funding in ACA • The Affordable Care Act (ACA) provides $11 billion in dedicated funding for health center operations and capital for FY2011-FY2015. • $9.5 billion to support health center operations. • $1.5 billion for capital needs. • Approximately half ($727 million) of the funding for capital has already been granted to 143 health centers across the country (FIP “have-nots”). • HRSA will make awards for previously-announced FY2011 funding opportunities contingent upon this year’s final CHC program funding level.

7. NHSC and THC Provisions in ACA • HRSA has publicly stated that NHSC field strength is over 10,000 and will reach 11,000 this year. • HRSA has streamlined the site application process; if all health centers seeking NHSC placements apply, the proportion of NHSC assignees at CHCs could reach 50% • HRSA recently announced designation of 11 THCs that will receive funding in the final months of this fiscal year to conduct community-based training of primary care residents. • 9 of 11 grantees are health centers or CHC-involved

8. This Year: Armageddon! 112TH CONGRESS 1ST SESSION H. R. 1 Making appropriations for the Department of Defense and the other departments and agencies of the Government for the fiscal year ending September 30, 2011, and for other purposes. IN THE HOUSE OF REPRESENTATIVES

9. Armageddon: What Does it Mean? • $600 million in CHC spending cuts halfway through Fiscal Year 2011, AND • $125 million in cuts to NHSC funding, AND • An ACO rule that effectively banishes CHCs to second-class status in reform =PLUS= • A House-passed 2012 budget that would dismantle Medicaid and force savage cuts in health & human service programs

10. House Budget’s Impact on Programs for Low- and Moderate Income People Source: “The Path to Prosperity” FY2012 Budget Resolution

11. Medicaid Costs 27% Less for Children, 20% Less for Adults Than Private Insurance Source: Center for Budget and Policy Priorities.

12. The Outlook for Medicaid • House-Approved Budget (Ryan) Plan for FY 2012 • Cap on all entitlement spending, including Medicaid • Block grant Medicaid (ends all guarantees) • Cut Medicaid by at least $1.4 trillion over next 10 years • Obama/Senate Proposals • Deficit reduction proposals: limit total federal spending w/ automatic cuts proportional to growth in spending from previous year • Other Medicaid issues/areas of concern • Maintenance of Effort (MOE) provisions • State flexibility – GOP Govs seeking freedom from limits

13. NACHC Medicaid Priorities • Preserve Medicaid • Health Centers payer mix: 37% Medicaid and CHIP • 46 – 50% Medicaid and CHIP expected in 2015 • Prospective Payment System (PPS) • Preserve the PPS and health reform’s “Menendez Amendment,” ensuring that private insurance plans pay at least Medicaid PPS • Partnership for Medicaid • Work with Congress to protect and strengthen Medicaid

14. Other NACHC Medicaid Priorities • Medicaid Health Information Technology Incentive Payments: The FIX-HIT Act (H.R. 1187, S. 643) • Automatic reassignment of ARRA Medicaid HIT Incentive Payments directly to health centers rather than providers • Prompt Pay • Current statute requires health centers be reimbursed within 12 months • Proposed statutory change: 90% of claims within 30 days, 99% within 90 days (current law for many other providers

15. Most Health Centers Meet Key Medical Homes Criteria Source: Health center data from 2009 UDS, HRSA and the 2010 HIT survey conducted by George Washington University, and the National Association of Community Health Centers. Note: All health centers are required to be governed by patient majority board to ensure quality care meets the needs of the community, and to provide quality of care data to HRSA in their annual UDS report.

16. Health Centers and Payment Reform • FQHC Payment Systems ARE reform • Bundled payment per visit, NOT open-ended fee-for-service • Rate unique to each center’s costs/scope, NOT single universal rate • Prospective Payment, with limited growth, NOT unrestricted • Effectively risk-based – if patients need more, furnished at NO additional cost • Original intent is still vital • Ensure appropriate payment for covered individuals • Not force Medicare/aid subsidy by uninsured grant funds

17. Health Center Participation in New Payment Systems • 45 health centers have been certified as medical homes by NCQA • 250 health centers plan to seek certification by 2012 • At least 50 health centers are participating in medical home demos, and CMS Medicare demo will involve 500 CHC sites • Most current demos (eg, Adirondacks NY) build off of current FQHC payment systems • In CO, health centers are participating in state Medicaid ACO demo in 6 of 7 regions, leading in 3 • HOWEVER, CMS proposed ACO rule prohibits FQHCs from forming ACOs, and prohibits assignment of Medicare FQHC patients to ACOs for shared savings purposes

18. What Does This Mean for Us? • No CHC will experience service cuts • All ARRA-funded services will continue • The NHSC still has TWICE its 2008 level • ACA expansion may be delayed, BUT there is still $6.5 billion (2/3 of original) expansion funding over next 4 years • Medicaid is still intact, even if under siege • ACO rule is not final yet In other words… =THE SKY HAS NOT FALLEN YET!!=

19. The Takeaway • The View from Capitol Hill is turbulent, with the parties taking dramatically different approaches on many big issues, especially the budget • Yet, we are still here, 23 million strong, with great bipartisan support & a great record on quality and cost-effectiveness • Our message remains the same: health centers offer a real solution that can appeal to all Members and contribute to improving fiscal health through SIGNIFICANT system-wide and Medicare/Medicaid savings. • Deep partisan divide will NOT last forever – already some are pulling back from most harmful changes

20. Where Can You Get More Information? • Visit our improved, expanded web site… • for more information on all issues, • for the latest on federal & state policy developments, including health reform, • for the schedule of webcasts and trainings on key health center management topics • Latest research & data on health centers • Read the Washington Update each week… All Are available at www.nachc.org

21. Thank You! Any Questions?