Medicaid at Work: A Lifeline for Millions and Community Health Center Patients

Medicaid is a lifeline for at least 1 in 5 Americans,¹ providing essential health coverage while supporting economic stability and community well-being. A comprehensive review by the Department of Health and Human Services (HHS) Office of the Assistant Secretary for Planning and Evaluation confirms that Medicaid access is associated with significant improvements in health outcomes and economic stability.²

Amid ongoing discussion in Washington about federal spending, Medicaid's future is uncertain. Policymakers are weighing potential changes that could have major consequences for Community Health Centers (CHCs) and the 32.5 million patients they serve. NACHC remains engaged in these discussions with policymakers on both sides of the aisle - evaluating proposals as they are developed for the impact on CHCs and their patients and advocating for policies that preserve access to care.

Importance of Medicaid Coverage to Community Health Centers and Their Patients

Medicaid is not only a crucial health insurance program for people with low incomes, but also a primary funding source for CHCs, ensuring access to care for high risk and underserved populations:

• CHCs are the nation's largest primary care network, serving 32.5 million people (or 1 in 10 nationally).
• Medicaid covers 50% of CHC patients and accounts for 42% of revenues.
• 70% of CHC patients live at or below the federal poverty level (e.g., families of three earning less than $27,000 per year).
• 90% of CHC patients have incomes below 200% of the federal poverty level.
• 1 in 5 rural residents rely on CHCs for preventive and primary care, mental health services, substance use disorder treatment, vision care, dental services, and social support services.

CHCs serve a high proportion of patients with chronic health conditions that require ongoing care, making Medicaid coverage essential for maintaining and improving health outcomes:

• 1 in 4 CHC patients are overweight or have obesity
• 1 in 5 CHC patients have hypertension
• 1 in 10 CHC patients have diabetes

Without stable Medicaid coverage and funding, patients face serious health risks, as chronic disease management depends on consistent access to primary and preventive care. Proposals to reduce Medicaid spending, limit enrollment, or reduce coverage would have severe implications for CHCs and their patients.

The harmful impacts include:

• Reduced access to care
  • CHCs, particularly those in rural and high-need areas, could close or limit services due to financial instability.
  • Approximately 2 in 5 CHCs have 90 days or less cash on hand, and more than half already operate with negative margins.³
• Worsened chronic disease management
  • Medicaid covers hypertension screenings, diabetes management programs, and early cancer detection services.
  • Without coverage, patients may delay or avoid care, leading to increased preventable Emergency Department (ED) visits and hospitalizations.
• Limited behavioral health services
  • Many CHCs have successfully integrated mental health and substance use treatment into primary care.
  • Reduced funding would shrink access to these services, worsening rates of untreated depression, anxiety, and substance use disorders.
• Weakened care coordination and case management
  • Medicaid supports patient-centered medical homes (PCMHs), which help manage care for patients with complex conditions.
  • Loss of funding would undermine coordination, making it harder for CHCs to track and address high-risk patient needs.
• Halted health technology and quality improvement efforts
  • Many CHCs rely on Medicaid funding for electronic health records (EHRs) implementation, telehealth expansion, and quality improvement initiatives.
  • Reduced funding could halt these advancements, impacting access, quality, and patient outcomes.

Community Health Centers Rely on Medicaid and Save Medicaid Money

CHCs have a strong track record of delivering substantial savings to the health care system, including Medicaid, by providing affordable, effective primary care and reducing utilization of higher cost settings, such as EDs and specialty care.⁴

HHS has also highlighted that CHCs save $1,411 per adult and $741 per child enrolled in Medicaid based on recent studies and referenced $11.4 billion in gross budget savings to Medicaid by the CBO. ⁵

The evidence shows that Medicaid is foundational to CHCs and their patients. Any potential changes that could harm this safety net are concerning.

1. https://www.kff.org/medicaid/issue-brief/10-things-to-know-about-medicaid/#:~:text=While%20Medicaid%20covers%201%20in,half%20of%20adults%20in%20poverty ↩︎
2. https://aspe.hhs.gov/sites/default/files/documents/effbde36dd9852a49d10e66e4a4ee333/medicaid-health-economic-benefits.pdf ↩︎
3. https://geigergibson.publichealth.gwu.edu/new-report-community-health-centers-grew-through-2023-serious-hazards-are-horizon ↩︎
4. Nocon RS, et al. (2016). Health Care Use and Spending for Medicaid Enrollees in Federally Qualified Health Centers Versus Other Primary Care Settings. Am J Public Health, 106*(11):1981-1989. ↩︎
5. Today with Macrae: Health Center Program Updates (Accessed December 6, 2024) ↩︎