[Congressional Record Volume 143, Number 157 (Sunday, November 9, 1997)]
[Extensions of Remarks]
[Pages E2288-E2289]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




             HELP FOR THE NATION'S COMMUNITY HEALTH CENTERS

                                 ______
                                 

                         HON. CHARLES B. RANGEL

                              of new york

                    in the house of representatives

                       Saturday, November 8, 1997

  Mr. RANGEL. Mr. Speaker, I am today sponsoring legislation to help 
the Nation's frontline health delivery organizations survive the move 
to managed care. The bill I am introducing today will provide Medicare 
wraparound payments to federally qualified health centers [FQHC's] and 
parallels a provision in this summer's Balanced Budget Act which 
provided Medicaid wraparound payments to FQHC's.
  FQHC's, such as community health centers [CHC's], receive about 8 
percent of their revenues--or about $200 million annually--in payments 
for care furnished to Medicare beneficiaries. For the services they 
provide, health centers are on a so-called reasonable cost basis, which 
is designed to ensure that sufficient funds are provided to cover the 
costs of care.
  As Medicare patients choose to move into managed care plans which 
include FQHC's as providers, the payment rates that the health 
maintenance organizations [HMO's] have been willing to pay the centers 
is often less than the FQHC payment described in the previous 
paragraph. My legislation is designed to correct this payment shortfall 
by providing that each FQHC will receive a supplemental wraparound 
payment from Medicare in an amount equal to the difference--if any--
between the FQHC rate and the amount the FQHC receives from the HMO. 
This type of wraparound provision was included in the Balanced Budget 
Act for Medicaid payments, but not for Medicare. Today's bill provides 
parallel treatment for Medicare and Medicaid payments to these 
frontline health delivery organizations.
  Why do these centers need an additional payment? Why can't they live 
with the managed care payment rate? Basically, these centers do so much 
additional, uncompensated care and outreach in their neighborhoods that 
they need what is the equivalent of a disproportionate share payment to 
help them finance these essential, extra services--and HMO's are 
unlikely to contract with providers who have these extra 
disproportionate share costs. If CHC's are to be able to continue their 
mission of service, they will need Medicare's help in financing these 
extra costs.
  Following is a memo from the National Association of Community Health 
Centers elaborating on the essential work of the Nation's CHC's and 
explaining why these extra wraparound payments are so necessary.

         Why Health Centers Merit a Special Wraparound Payment

       The current reasonable-cost reimbursement provisions for 
     health centers were established by Congress to ensure that 
     Medicare and Medicaid cover the reasonable cost of furnishing 
     covered services to their beneficiaries. Underpayment to 
     these centers is particularly onerous because the revenue to 
     cover unreimbursed costs can only come from federal and state 
     grants intended to support services for the uninsured and 
     essential, non-covered services for others. Health centers 
     cannot absorb risk for several reasons:
       Their Patients: Health center patients comprise the most 
     vulnerable populations in America today--persons who, even 
     when insured, remain isolated from traditional forms of 
     medical care because of where they live, who they are, and 
     their frequently far greater levels of complex health care 
     needs. Because of factors such as poverty or hopelessness 
     (not to mention the social-environmental threats that 
     permeate low income/underserved communities), health center 
     patients are at higher risk for serious and costly conditions 
     (diabetes, hypertension, TB, high-risk, pregnancies, HIV) 
     than the general population.
       Their History and Mission: Health centers were founded to 
     make their services available to all in their communities, 
     and particularly to those who can't get care elsewhere (again 
     because of who they are and their often complex health and 
     social problems). They have already proven their efficiency, 
     but their fundamental mission and purpose should not be 
     compromised by placing them at risk for the care their 
     patients need. On the contrary, because they serve 
     disproportionate numbers of high-risk patients, adequately 
     compensating the health centers for their care can serve to 
     make risk levels more reasonable for other providers.
       Their Services: Health centers offer comprehensive, ``one-
     stop'' primary care rather than a traditional medical model 
     for chronic and acture care. Prevention is the focus. These 
     services need to be promoted, not restricted or reduced, as 
     would be the case under risk based contracting. For their 
     patients and communities, in particular, expanding the 
     availability of preventive and primary care services will be 
     vital in increasing access and reducing costs. Here, too, the 
     success of managed care will depend on this.
       Improving Access: As has been noted, health center 
     patients--whose health problems are typically more serious 
     and more complicated than it true of other Americans--
     frequently need special services that may not be recognized 
     as reimbursable, but which are essential to ensure that 
     effectiveness of the medical care provided. These services, 
     such as multilingual/translation services, health/nutrition 
     education, patient case management services, outreach and 
     transportation, will need to be provided, even if they are 
     not covered and reimbursable; thus, the centers cannot rely 
     on their other funding sources to cover them against 
     excessive risk.
       No Reserves. Because of their historic mission and the 
     restrictions placed on them by their funding sources, health 
     centers have no available capital, limited marketing 
     capability, poor and sicker patients and thus no leverage in 
     the marketplace. Moreover, all revenues received by health 
     centers (all of which are either public or not-for-profit 
     organizations) are reinvested in patient care services--
     there are no ``profits,'' and they have no reserves to 
     protect them against risk. Consequently placing too much 
     risk on health centers would force them to remain outside 
     the managed care system rather than being centrally 
     involved.
       Perhaps most importantly, development of primary and 
     preventive care in underserved communities has been 
     particularly effective in reducing unnecessary and 
     inappropriate use of other settings such as emergency rooms 
     which are much more costly. This is especially true of 
     public-private partnerships such as the federally-assisted 
     health center programs, which today provide care to nearly 10 
     million low income people in underserved rural and urban 
     communities across the nation. Because of their experience, 
     the health centers--together with other key community 
     providers--form the backbone of the local health care system 
     for most underserved people and communities, and have

[[Page E2289]]

     had a major impact on the health of their communities.
       Their presence and availability of services has 
     significantly lowered unnecessary use of costlier, less 
     appropriate settings such as hospital emergency rooms and 
     ``Medicaid mills''.
       Their consolidation of both preventive and comprehensive 
     primary care services under one roof has measurably reduced 
     the frequency and cost of preventable illnesses.
       Their experience in case management has brought about a 
     substantial reduction in specialty care and hospital 
     admissions, saving millions of dollars for the health care 
     system.
       Despite the poorer overall health of their patients, 
     studies have shown that health centers are tremendously 
     effective in reducing total health care costs for their 
     patients. Recent studies in California, Maryland, and New 
     York show that those states incurred 30% lower cost per case 
     for Medicaid recipients who were regular patients of 
     community health centers than for Medicaid recipients who 
     used other providers. These findings underscore those in a 
     earlier 5-day study that showed significant Medicaid savings 
     through use of health centers.

     

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