Leaders of community health centers in the Northland say they’re prepared to weather the storm if Congress fails to meet a Sept. 30 deadline to renew federal funding.
But they’re not happy about the uncertainty.
“It's a tough way to run a business … every two years wondering what's going to happen to a significant source of our revenue,” said Dayle Patterson, CEO of the Lake Superior Community Health Center, which serves the Twin Ports.
At issue is the federal Community Health Center Fund, which supplies more than 70 percent of the grant funding to more than 1,300 community health centers across the United States — $4 billion in fiscal year 2019. The centers provide care to 28 million patients in medically underserved rural and urban areas, according to the Kaiser Family Foundation. The two-year fund will expire Sept. 30 if Congress doesn’t act to extend it.
In survey results released on Wednesday, the Kaiser Family Foundation reported that a small number of health centers already have instituted cutbacks because of the uncertain situation, and many more are preparing to do so. For example, nearly six in 10 either had a hiring freeze in place or were considering it, and 35 percent had either cut back on their hours or were considering it.
No such steps are contemplated, at least in the short term, at either the Lake Superior Community Health Center or the Sawtooth Mountain Clinic in Grand Marais.
“We're actually very lucky up here in that it would not affect us immediately,” said Katherine Surbaugh, CEO of Sawtooth Mountain Clinic, which is the only primary care clinic in Cook County. “We have (a) diverse revenue stream. If it went on for a long period of time, there is the concern that it could cause us some harm.”
Likewise, the Lake Superior Community Health Center is less dependent on federal funding than many others are, Patterson said.
“We're very fortunate to already have a fair amount of local and state support,” she said. “But … if we were to go multiple months into a new year with no sign of funding, we would obviously need to start looking for alternatives.”
The health center, which has clinics in Duluth and Superior, has an annual budget of about $9 million, $1.5 million of which comes from federal sources, Patterson said. Of that, 70% is part of the fund that requires congressional action every two years.
Statewide, community health centers receive anywhere from 5% to 60% of their total support from that fund, said Jonathan Watson, executive director of the Minnesota Association of Community Health Centers.
Centers that are more dependent will be looking at measures such as a hiring freeze if Congress doesn't act by Sept. 30, Watson said. But there's already an opportunity cost, as in the case of a health center in southern Minnesota that in February stopped discussions about expanding dental services because of the "cliff" approaching in October.
For that reason, Watson said he's encouraged that both of the bills to extend funding also would lengthen the duration of that funding, to four years in the House and to five years in the Senate.
Even if this month comes and goes without congressional action, the Lake Superior Community Health Center has some breathing room, Patterson said, because its funding cycle goes through the end of February.
For about a quarter of all health centers it ends on Dec. 31.
“What we're told is if we did go over the cliff … and there was no congressional action, that we would likely have our funding available to us through the end of our grant period,” Patterson said.
A reason for optimism is that community health centers enjoy “fairly broad bipartisan support,” Surbaugh said.
That’s because the health centers have proven to be a good investment, Patterson added. It’s estimated that they save the health care system $28 billion annually because of how cost-efficient they are, she said.
Watson also sees it that way.
"I just think in the hyper-partisan world that Congress has right now on a lot of issues, where there is that polarization, community health care isn't one of those," he said. "It's an easy one where they can demonstrate bipartisan support for a completely effective program."