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Increasing Health Center Capacity by 20 Million Patients Could Save More Than $200 Billion Over the Next Decade
Date:9/1/2009

Medicaid Savings Could Surpass $59 Billion

WASHINGTON and NEW YORK, Sept. 1 /PRNewswire-USNewswire/ -- Expanding health centers to reach an additional 20 million patients as part of national health reform would result in overall health care savings of $212 billion over the ten-year period 2010 to 2019, including federal Medicaid savings of $59 billion. The dollar value of these expected savings far exceeds the cost of the health center investment of $38.8 billion called for in the July 14 version of the House health reform bill. These findings are contained in a new study entitled "Using Primary Care to Bend the Curve: Estimating the Impact of a Health Center Expansion on Health Care Costs," conducted by faculty and staff at The George Washington University School of Public Health and Health Services and funded through the Geiger Gibson/RCHN Community Health Foundation Research Collaborative.

This research brief, the third in a series examining the link between national health reform proposals and community health centers, estimates the cost savings that would be realized by making important investments in non-profit health centers as an element of national health reform. The brief makes several key findings:

  • Today, in 2009, health centers serve 19 million patients, which will generate health system savings of $24 billion in this year because of the lower overall medical expenditures associated with health center patients.
  • Coupling insurance reforms with a 20-million patient increase in health center capacity over the next ten years would generate an additional $35.6 billion in savings in the year 2019. Over this ten-year period 2010 to 2019, cumulative health system savings would reach an estimated $212 billion.
  • Were payments to health centers by health insurers operating in a health insurance exchange to be set at Medicaid's prospective payment rate, the number of new patients served would rise from 20 million to 22 million, with more than 41 million patients served. This additional change would raise the ten-year cumulative health care savings to $251 billion over the 2010-2019 time period.
  • At 20 million additional patients served, Medicaid savings would reach $59 billion over the ten-year time frame. Were the number of additional patients served by health centers to rise to 22 million, federal Medicaid savings would exceed $70 billion over ten years.

Sara Rosenbaum, Hirsh Professor and Chair of the Department of Health Policy at GW, said, "These estimates underscore the importance of simultaneous investments in both health insurance reform and health center expansion funding to create sustainable primary care for medically underserved communities."

"The direct federal investment in health centers needs to go hand in hand with insurance expansion for low income patients," added Julio Bellber, president and CEO of the RCHN Community Health Foundation. "Together they can create an economic engine that will allow us to extend the high quality, primary healthcare home model to all communities."

The savings projected under the study reinforce the premise that health insurance coverage expansions, coupled with investments in the nation's primary health care infrastructure, can spur high quality and sustainable primary health care in medically underserved rural, urban and suburban communities while simultaneously bending the health care cost curve.

The report is available at:

http://www.gwumc.edu/sphhs/departments/healthpolicy/dhp_publications/pub_uploads/dhpPublication_61D685D5-5056-9D20-3DDB6CDE10382393.doc

About the RCHN Community Health Foundation

The RCHN Community Health Foundation (RCHN CHF) is a New York-based not-for-profit operating foundation dedicated to supporting and benefiting community health centers (CHCs) in New York state and nationally. The Foundation develops and supports programmatic and business initiatives related to community health center access, pharmacy and health information technology through strategic investment, research, outreach, education, and coalition building. For more information about RCHN CHF, visit www.rchnfoundation.org.

About The George Washington University Medical Center

The George Washington University Medical Center is an internationally recognized interdisciplinary academic health center that has consistently provided high-quality medical care in the Washington, DC, metropolitan area for 176 years. The Medical Center comprises the School of Medicine and Health Sciences, the 11th oldest medical school in the country; the School of Public Health and Health Services, the only such school in the nation's capital; GW Hospital, jointly owned and operated by a partnership between The George Washington University and Universal Health Services, Inc.; and the GW Medical Faculty Associates, an independent faculty practice plan. For more information on GWUMC, visit www.gwumc.edu.

All news releases available online at www.gwumc.edu/mccm


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SOURCE George Washington University
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