State House Day 2000

FOR IMMEDIATE RELEASE
February 16, 2000
Contact: Kerin O’Toole
617-426-2225

Finneran, Montigny & Other Legislators Join Health Centers in Support of Safety Net

Over 300 fill State House Great Hall
State House, Boston - In a show of support for shoring up the Commonwealth’s health care safety net, Speaker of the House Thomas Finneran, Senate Ways & Means Committee Chair Mark Montigny, Health Care Committee Chair Harriette Chandler, Senator Stephen Lynch and Representative Kevin Fitzgerald joined more than 300 legislators, health center staff and other supporters of community health at the League’s 4^th annual "Community Health Center Day at the State House" on Wednesday, February 16.

Providing the morning keynote address, House Speaker Thomas Finneran (D-Mattapan) told the audience that many lawmakers are focused on the problems in the health care system, and feel a strong sense of urgency in preserving "the best health care in the entire world."

Referring to the establishment of a tobacco settlement trust fund and the recent distribution of nearly $5 million in hardship relief grants to 11 health centers, the Speaker said the Legislature would try to do more this year, adding that, "we’re all in this together and I’m very, very confident that we can and will make important progress this year."

Speaker Thomas Finneran
Massachusetts House of Representatives

	Representative Kevin Fitzgerald, who served as moderator for the event, praised the work of health centers for "staying in close touch with their communities" and for "creating a system of health care for those who would otherwise rely on a hospital emergency room for their primary source of health care."
Representative Kevin Fitzgerald Division Chairperson, House of Representatives

League releases report on troubling financial trends at health centers
Underscoring the developing crisis in community health care, the Massachusetts League of Community Health Centers ("the League") released a report revealing disturbing financial trends at the state’s 46 community health centers. The League unveiled the report at its annual advocacy day at the State House with the support of legislative leaders who are concerned about the fragility of the state’s health care safety net.

"Health Centers are an important piece of the health care safety net, and the safety net is fraying," said James W. Hunt, Jr., executive director of the Massachusetts League of Community Health Centers. "We are here today to ask our legislative leaders to do more than provide a patch for the safety net, we are asking them to invest in its long-term repair."
	James W. Hunt, Jr., Executive Director Massachusetts League of Community Health Centers

The report, "State of the State: Financial Trends at Massachusetts Community Health Centers, 1995 - 1998," prepared by the Community Health Center Capital Fund, examines data drawn from Massachusetts health center cost reports and independently audited financial statements in an effort to identify significant financial trends within the health center industry from FY95 to FY98.

The report, based on median values, indicates that between FY95 and FY98:

Total client visits continued to grow. In two of the years, visits grew faster than Operating Revenue.
More than half of all Massachusetts health centers lost money on an operating basis.
In FY98, 41% of Massachusetts health centers lost money on a bottom line basis.
The rate of increase in health center Operating Revenue slowed considerably. Further, the proportion of health centers experiencing a decline in Operating Revenue increased from 9% in FY95 to 20% in FY98.
Operating Expenses grew consistently, although the rate of growth declined between FY95 and FY97. In FY98, the rate of increase jumped to almost 10%. Over the period, the growth in Operating Expenses consistently outpaced the growth in Operating Revenue.

The release of the report comes on the heels of one urban health center’s recent emergence from bankruptcy and the near financial collapse of six others. In addition, the state recently provided nearly $5 million in hardship relief grants to health centers from a $7 million fund established last October for financially distressed community health centers and hospitals.

Inadequate reimbursement for care & patient growth cited as key reasons for financial trouble

Zoila Torres Feldman, president of the Massachusetts League of Community Health Centers, cited inadequate reimbursement for the care of Medicaid, uninsured and underinsured patients as the key reason for financial trouble at Massachusetts community health centers. "Historically, health centers have not been reimbursed for the full cost of caring for their patients, many of whom have complex medical and social needs," said Torres Feldman.

Zoila Torres Feldman, President,
Massachusetts League of Community Health Centers
Executive Director,
Great Brook Valley Health Center, Worcester

Samuel Thier, M.D., Chief Executive Officer, Partners HealthCare System, and underwriter of the event, praised health centers for their "Herculean efforts to continually do more with less." While Thier applauded legislators for their work to expand health insurance for more uninsured children and adults, he emphasized that with Medicaid reimbursement falling far behind the cost of providing care, health centers will find it increasingly difficult to deliver care "effectively and efficiently with very few changes in the number and breadth of programs and services."

Samuel Thier, M.D., Chief Executive Officer, Partners HealthCare System

Daniel Driscoll
Chief Executive Officer,
Harbor Health Services, Dorchester

Exacerbating the problem added Daniel Driscoll, League member and Chief Executive Officer of Harbor Health Services in Dorchester, is the increased demand for community health center services. "With the recent expansion of the state Medicaid program, community health centers have been working closely with the state Division of Medical Assistance to enroll newly eligible individuals into state insurance plans," said Driscoll. He added that while health centers remain "ardent supporters of joint outreach and enrollment efforts," the program expansion has placed strain on health center budgets for two major reasons: (1) health centers are taking care of an increasingly medically complex population for which they are not adequately reimbursed; and (2) health centers must incur the added costs of patient outreach, program eligibility determination and enrollment.

Additionally, as the availability of health care funding within the overall system continues to shrink, health centers are finding it increasingly hard to offset discrepancies in their budgets. "With the squeeze on at every level of the health care system, health centers can no longer ‘back fill’ their budgets with philanthropic money or special grant initiatives,’ said Hunt. "Health centers effectively have become dependent on rates of reimbursement that don’t cover their costs."

Lack of capital & reserves force cutbacks in services
Hunt added that while other industries can make up the difference by taking money out of long-term investments or reserves, health centers are forced to cut back on services in a time when there is an increasing need for community-based health care. "It just doesn’t make sense for health centers to have to cut services when, for one, they offer the least costly setting for a primary care visit, and two, their focus on preventive care leads to far greater savings to the overall health system," he said.

Other factors include the costs associated with the growth of information technology and the recent wave of renovation and building for health centers that have long outgrown their storefront clinics, and can no longer maintain productive practices in small spaces using outdated equipment.

Azzie Young, PhD, Executive Director, Mattapan Community Health Center reminded legislators about the spirit and mission of community health centers, and about the efficiency with which health centers deliver care on shoe-string budgets.

"It’s not about money, or plush offices, or high salaries," said Young. "Our bonus check comes in the form of healthy babies. Our job satisfaction comes when a 50-year old woman we have never seen before comes into the health center to schedule her first mammogram because she has heard we can help her. Our new offices come in the form of school-age children who start school up-to-date on their immunizations and with a new book they got from visiting their local health center."

Azzie Young, PhD, Executive Director, Mattapan Community Health Center, Mattapan

	"In this dangerous time, where obsession with the bottom line drives too many in the health care industry, the true last resort and savior for so many are our community health centers," said Senator Mark Montigny, chair of the Senate Committee on Ways and Means. He added: "Anyway we can, we should be supporting the community health centers financially."
Senator Mark Montigny, Chair, Senate Committee on Ways and Means

Strategic Relief
In response to the troubling financial trends laid out by the report, Hunt and his membership of 46 community health centers are requesting strategic relief through the FY2001 state budget:

Reimbursement rates that reflect the actual costs of health center care for Medicaid and low income uninsured patients
$5 million in tobacco settlement funding to meet the rising demand for health center medical, dental, and other services as a result of Medicaid expansion and the growth in uninsured and underinsured populations
$5 million in additional funding for community health center systems development to enhance overall management efficiencies, and to recruit and retain high quality, culturally competent providers
Continued funding for managed care at community health centers and for a program of technical assistance administered through the League
Continued assistance to health centers in financial crisis

"Massachusetts community health centers were the first of their kind in the nation, and to this day remain the finest," said Representative Harriette Chandler, chair of the Committee on Health Care. "They deserve both our support and respect as critical providers within the Commonwealth’s safety net."
	Representative Harriette Chandler, Chair, Committee on Health Care

William Walczak, League member and executive director of the Codman Square Health Center in Dorchester, lead the rally cry, asking legislators to recognize the crisis in community health care and help prevent its further decline.

	"In this dangerous time, where obsession with the bottom line drives too many in the health care industry, the true last resort and savior for so many are our community health centers," said Senator Mark Montigny, chair of the Senate Committee on Ways and Means. He added: "Anyway we can, we should be supporting the community health centers financially."
William Walczak, Executive Director, Codman Square Health Center, Dorchester	"Community health centers are not in a position to just say ‘no’ to our patients," Walczak said. "It’s our mission to care for everyone, regardless of their circumstances. We’re the responsive health care system -- we have to be there for our communities."

Walczak continued: "When the rest of the system melts down, others dig into reserves. We have no reserves, no endowment. All we have is you, our legislators. Please don’t let the best system of care for the underserved in the nation fall apart."

For details on 2005's State House Day, click here.
For details on 2004's State House Day, click here.
For details on 2003's State House Day, click here.
For details on 2002's State House Day, click here.
For details on 1999's State House Day, click here.

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