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Substance Abuse and Mental Health Services Administration
Community Health Centers: Adapting to Changing Health Care Environment Key To Continued Success
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About 35 years ago, federal community and migrant health centers (C/MHC) were established to increase the availability of primary and preventive health care services for low-income people living in medically underserved areas. C/MHCs have been an important safety net provider for Medicaid beneficiaries, minorities, and uninsured families. In some communities, they may be the only primary care provider available to these vulnerable populations. C/MHCs rely on funding from a wide variety of public and private sources, including federal, state, and local governments; foundation grants; and payments for services from Medicaid, Medicare, private insurance, and patients. Fiscal year 2000 appropriations for the Consolidated Health Centers program totaled over $1 billion.

Recent developments in the health care environment—such as the steady growth in the number of uninsured, a dramatic increase in the use of managed care by Medicaid, and increased competition and consolidation among health care providers—have presented new challenges for C/MHCs. In light of these developments, you asked us to examine how C/MHCs are evolving to meet the needs of the nation’s vulnerable populations. Specifically, you asked us to (1) describe the current status of C/MHCs, the populations they serve, the types of services they provide, and their primary sources of revenue; (2) describe changes in Medicaid that have had an effect on C/MHCs; (3) discuss how C/MHCs have responded to these and other changes in the health care environment; and (4) assess the Department of Health and Human Services’ (HHS) actions to monitor C/MHC performance and help them improve operations.

To conduct our work, we analyzed national data from C/MHCs that receive federal grants and interviewed federal officials, representatives of state and national C/MHC membership organizations, and primary care experts. We also conducted case studies of eight C/MHCs in urban and rural areas of Colorado, Florida, and Maryland and met with state public health and Medicaid officials and C/MHC membership organizations in those states. To assess HHS’ oversight activities and obtain views about C/MHCs nationwide, we interviewed headquarters and field office officials in HHS’ Health Resources and Services Administration (HRSA), which administers the grants to centers, and reviewed documents they provided. Financial and demographic data on C/MHCs come from HRSA’s Uniform Data System (UDS), an administrative database of self-reported information from C/MHCs. Our work was conducted from September 1998 to January 2000 in accordance with generally accepted government auditing standards. (GAO)
Washington, D.C.