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Report: Congress Should Increase Funding for Community Health Centers

By Leah Nylen, CQ Staff

March 20, 2008 -- Community health centers could save taxpayers as much as $40 billion per year in health care costs if the federal government is willing to invest $10.5 billion over the next eight years, according to a report released recently by the National Association of Community Health Centers (NACHC).

The report, titled "Access for All America," urges Congress to increase the funding for health centers between 12 and 15 percent each year. The centers would use the money to invest in new facilities and technologies, such as health IT, and the improvements would allow health centers to increase the number of patients to 30 million by 2015.

Created under a federal law in 1965, community health centers assist about 17 million uninsured and people in medically underserved areas at 6,300 facilities around the United States.

Heath centers already save as much as $18 billion a year by keeping the estimated 56 million Americans without primary care physicians out of hospitals and emergency rooms, according to estimates from the Robert Graham Center at the American Academy of Family Physicians. A single visit to a hospital emergency room can cost more than a year's worth of care at a community health center, said Dan Hawkins, policy director at NACHC.

About 22 percent of the funding for community health centers—$2.1 billion in fiscal 2008—comes from the federal government in the form of grants administered by the Health Resources and Services Administration. But because of federal law, community health centers cannot use the grant money for capital improvements and expansions.

The report suggests several changes to the law—such as tax credits or allowing health centers access to tax-exempt bonds—to help health centers complete capital projects like renovations.

About $1 billion of the increase for health centers would go towards investing in health IT projects, such as electronic health records.

"We're not asking for a handout. What health centers are asking for is an investment," Hawkins said. "When we get to 30 million, the savings generated will be upwards of $40 billion. This is an investment with a great return: lower costs for everyone."

According to Hawkins, the response from members of Congress toward the plan has been positive.

A Senate bill, S 901, would reauthorize funding for community health centers in even greater amounts than the report requested. The full Senate has not yet considered the bill, and no action has occurred on a House companion, HR 1343.

However, neither bill would alter the law to allow the grants to be used for capital programs. But a separate Senate bill sponsored by Debbie Stabenow, D-Mich., S 2270, would allow community health centers to participate in a federally guaranteed mortgage insurance program within the Department of Housing and Urban Development.

"The fact that community health centers are unable to take full advantage of programs that provide necessary funding and support just doesn't make sense," Stabenow said in a statement. "This bill is a critical step toward providing quality, affordable health care to all Americans."

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