*Administration of Barack H. Obama, 2009 *

**Memorandum on Medicare Demonstration To Test Medical Homes in Federally Qualified Health Centers **

*December 9, 2009 *

*Memorandum for the Secretary of Health and Human Services *

*Subject:* Medicare Demonstration To Test Medical Homes in Federally Qualified Health Centers

My Administration is committed to building a high-quality, efficient health care system and improving access to health care for all Americans. Health centers are a vital part of the health care delivery system. For more than 40 years, health centers have served populations with limited access to health care, treating all patients regardless of ability to pay. These include low-income populations, the uninsured, individuals with limited English proficiency, migrant and seasonal farm workers, individuals and families experiencing homelessness, and individuals living in public housing. There are over 1,100 health centers across the country, delivering care at over 7,500 sites. These centers served more than 17 million patients in 2008 and are estimated to serve more than 20 million patients in 2010.

The American Recovery and Reinvestment Act of 2009 (Recovery Act) provided $2 billion for health centers, including $500 million to expand health centers' services to over 2 million new patients by opening new health center sites, adding new providers, and improving hours of operations. An additional $1.5 billion is supporting much-needed capital improvements, including funding to buy equipment, modernize clinic facilities, expand into new facilities, and adopt or expand the use of health information technology and electronic health records.

One of the key benefits health centers provide to the communities they serve is quality primary health care services. Health centers use interdisciplinary teams to treat the "whole patient" and focus on chronic disease management to reduce the use of costlier providers of care, such as emergency rooms and hospitals.

Federally qualified health centers provide an excellent environment to demonstrate the further improvements to health care that may be offered by the medical homes approach. In general, this approach emphasizes the patient's relationship with a primary care provider who coordinates the patient's care and serves as the patient's principal point of contact for care. The medical homes approach also emphasizes activities related to quality improvement, access to care, communication with patients, and care management and coordination. These activities are expected to improve the quality and efficiency of care and to help avoid preventable emergency and inpatient hospital care. Demonstration programs establishing the medical homes approach have been recommended by the Medicare Payment Advisory Commission, an independent advisory body to the Congress.

Therefore, I direct you to implement a Medicare Federally Qualified Health Center Advanced Primary Care Practice demonstration, pursuant to your statutory authority to conduct experiments and demonstrations on changes in payments and services that may improve the quality and efficiency of services to beneficiaries. Health centers participating in this demonstration must have shown their ability to provide comprehensive, coordinated, integrated, and accessible health care.

This memorandum is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity by any party against the United States, its departments, agencies, or entities, its officers, employees, or agents, or any other person.

You are authorized and directed to publish this memorandum in the *Federal Register*.

BARACK OBAMA

[Filed with the Office of the Federal Register, 8:45 a.m., December 11, 2009]

NOTE: This memorandum was published in the *Federal Register* on December 14.

*Categories:* Communications to Federal Agencies : Medicare demonstration to test medical homes in Federally qualified health centers, memorandum*.*

*Subjects:* Economy, national : American Recovery and Reinvestment Act of 2009; Health and Human Services, Department of : Medical homes, Medicare demonstration project in Federally qualified health centers; Health and medical care : Home health care agencies and programs; Health and medical care : Information technology.

*DCPD Number:* DCPD200900980.