Transcript Understanding Our Financial Landscape

Healthy Communities: The Intersection of
Community Development and Health
Sept. 28, 2011
Federal Reserve Bank of Dallas
Community Health Centers:
The Foundation of Community Economic Health
What Are Community Health Centers?
• Primary care medical clinic
• Located in low income areas – urban and
rural
• Small federal operating grant
• Delivers care regardless of patient’s ability
to pay.
• High number of uninsured and Medicaid.
• It’s a doctor’s office! But more.
Services Provided by CHCs
•
•
•
•
•
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Individual and family medical care
OB/GYN services
Pre-natal care
Dental Services
Behavioral Health
Optometry
Outcomes and Costs?
• Patient mix much higher for at-risk
individuals
• Yet, health outcomes are significantly
better than private providers.
• And, cost of services significantly lower
than private providers.
• ER diversion is critical in some
communities.
• Moreover…a whopping 22% better
outcomes on prevention!
What Creates Wellness?
50%
50%
45%
40%
35%
30%
25%
20%
20%
20%
10%
15%
10%
5%
0%
Genetics
Environment
Behavior
© HealthChange, LLC 2004-2005
Care
Economic Impact
National Impact of Healthcare
25.00%
25%
20.00%
15.00%
15%
10.00%
5.00%
3%
1900
6%
1964
1994
2020
0.00%
% of GDP
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Community Impact
• Tend to be the largest employer in the
urban community.
• Create the foundation for a healthy
workforce
• Are community activists for safe
environment (traffic and general safety)
• Often, especially in urban areas, their
building projects provide the largest
economic impact in the community’s
history.
Examples from Massachusetts
• Lowell CHC - $40 million expansion
• Fenway CHC - $65 million new facility
• Mattapan CHC- $32 million new
facility
• Whittier Street CHC - $37 million new
facility
• 350 – 450 staff members
Texas Association of
Community Health Centers
• Worked with many CHCs individually in
Texas on capital projects – two currently
• TACHC (Daniel Diaz) have provided
educational seminars on business planning
and grant applications
• Did a financial trends analysis for TACHC
and 50 CHCs
Banks and CHC’s
Community Reinvestment Act – perfect
Use of New Market Tax Credits – perfect
Market analysis
Economic impact analysis
Financial trends analysis
Loans typically only 30% of total project
costs!
• Typical debt service coverage ratio: above
2.0
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Health Care in the U.S.
• CHCs are on the front line of health care
• 49.9 million American’s are uninsured
• 44% of all Americans are under-insured
(still can’t pay for health care)
• What’s to come?
Social Security, Medicare & Medicaid
Outlays as a Percentage of GDP 1990-2075
24
Social Security
22
Medicare
20
Medicaid
18
16
14
12
10
8
6
4
2
0
1990 2000 2010 2020 2030 2040 2050 2060 2070
Source: C. Eugene Steurle and Adam Carasso, (Budget Crisis at the Door), The Urban Institute, 2003. Based on data
from the Congressional Budget Office, “A 125-Year Picture of the Federal Government’s Share of the Economy, 19502075,” July 3, 2002, table 2.
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Federal Receipts vs. Entitlement Spending
22
20
18
16
14
12
10
8
6
4
2
Baseline SS, Medicare, and Medicaid
Baseline receipts (includes JGTRRA)
Return to 2002
Continue at same rate
0
1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040
(As percent of GDP)
Source: C. Eugene Steurle and Adam Carasso, (Budget Crisis at the Door), The Urban Institute, 2003 Based on data
from Budget of the U.S. Government, FY 2004 and CBO’s “Analysis of the President’s Budget, FY 2004.”
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International Monetary Fund
Determined that the U.S.
must increase taxes by 60%
or
Reduce Medicare, Medicaid and
Social Security
Benefits by 50%
CHCs on The Front Line
• The most cost effective source of health care in the
U.S.
• The most “health effective”
• The most effective source of preventative care.
• And yet, they are on the front line against highest
risk and lowest economic cohort of Americans.
• The future capability of America’s health care
system may largely depend on its CHCs
• As well may the economic sustainability of
thousands of urban and rural communities.
Terry Glasscock
Capital Link, Inc
[email protected]
781-789-6847