As Congress Stalls, More Community Health Centers Face Closure or Cuts

The failure to pass a long-term federal budget is hurting clinics that largely serve low-income and rural areas. States aren't offering any relief.
by | February 2, 2018
Family members help one another fill out forms at a community health center. (AP/Cliff Owen)

Fish River Rural Health is a community health center that’s about as frontier as it gets: It serves the population in northernmost Maine, along the border of Canada. According to Heather Pelletier, its executive director, "the people here are really friendly, but it’s really rural and really remote."

That's not uncommon among the 1,400 organizations funded by the Community Health Center Fund, which was created by the Affordable Care Act (ACA) and has faced an uncertain future since Congress let it expire more than four months ago. These clinics serve 27 million mostly low-income people -- half of whom live in rural areas where options for medical care are limited.

Fish River also benefits from the National Health Service Corp, which pays doctors' medical school debt if they work in medically underserved areas. That, too, was allowed to expire in the fall.

The federal government released enough money to keep both programs running through March, but advocates say many places are getting down to the wire. About 70 percent of community health centers' funding comes from the federal government. Without a guaranteed cash flow, community health centers around the country are struggling. If the next federal budget deadline comes and goes on Feb. 8 with no funding, a lot more may close their doors, reduce services and lay off staff.

The uncertainty of future funding is already having an impact.

As Governing previously reported, one community health center was already forced to closed in Delaware. According to a new survey by the Kaiser Family Foundation, 3 percent have taken action toward closing and another 36 percent are considering shutting their doors. Four percent of community health centers have already laid off staff and another 53 percent might. And roughly a third of respondents said they may reduce some services, including addiction treatment, mental health and dental.

At Fish River, after the long-time dentist on staff announced his retirement, the clinic found a replacement and was working through the logistics of his contract when Pelletier got bad news: The candidate had received an email that Service Corp money was no longer secure. He decided not to take the job. 

For the last few months, most of the conversation about the budget gridlock in Congress was aimed at the Children’s Health Insurance Program (CHIP). But after the Jan. 22 government shutdown, CHIP has been fully funded for six years. Health care experts, however, say the programs still in limbo are just as vital to the social safety net as CHIP.

“Everybody in Congress, all the way up to House Speaker Paul Ryan, tells us that they’ll move on it as soon as they can,” says Dan Hawkins, senior vice president of public policy and research at the National Association of Community Health Centers. “Our message though, loud and clear, is they can’t leave us hanging any longer. You can’t run a business like this.”

While state health officials have been lobbying their members of Congress to fund these programs, states themselves aren't offering these clinics any financial relief.

Hawkins says states gave a total of $700 million to community health centers last year, which may be why they aren't scrambling right now to move money around. Right now, the uncertain fate of community health centers doesn't appear to them to be as much of a code-red situation as ending children's health insurance. 

John Mengenhausen, CEO of Horizon Health Care, a community health center organization in South Dakota, had a meeting with Gov. Dennis Daugaard and Health Secretary Kim Malsam-Rysdon back in December to discuss worst-case scenarios.

“I told them that we’re seeing your Medicaid patients, so if we go away, good luck in those emergency rooms," he says. "But we heard that there’s no state money, that they’re operating on an already tight budget. So we aren’t seeing any help from the state, no."

In Maine, the state allotted an extra $23,000 to community health centers in 2014, and Pelletier says she’s under the impression it was considered “extraordinarily generous” and something unlikely to be replicated -- even under these circumstances.

Hawkins, however, says he’s heard from lawmakers in California and New York who said their states will provide some stopgap funding if Congressional inaction continues or clinics start closing. It's unclear how much money they would offer or when.

If community health centers' federal funding is ultimately not renewed, it’s estimated that up to 160,000 jobs across the country could be lost.

“So if we’re talking about closing doors, we’re also talking about a major economic impact,” says Mengenhausen.

Patients are starting to ask questions.

“I don’t know if they’ve reached the point of panic, but they are getting curious," says Pelletier. "People thought when CHIP was reauthorized, so would community health centers."

In the meantime, she faces a retiring dentist and no easy way to replace him.

“It went from being this guaranteed program to ‘wow, this could go away,’" says Pelletier, "and it did."

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