Monday, October 23, 2017

New Report Highlights Financial and Operational Trends of Health Centers


The four-year period of 2012-2015 was a time of high growth for community health centers across the United States. The implementation of the Affordable Care Act resulted in the expansion of Medicaid and increased patient demand, but also a need for health centers to effectively manage their operations by better understanding their financial and operational performance.

Capital Link’s newly released report, Federally Qualified Health Centers Financial and Operational Performance Analysis, 2012-2015, highlights multi-year financial and operational trends of community health centers on a national basis. The analysis provides a framework for identifying the financial strengths, challenges, and opportunities for performance improvement.  

The report uncovered interesting findings across several financial and operational functions, including statistics related to growth and expansion, productivity and utilization, and financial measures. Most notably:

·         There was significant growth in both patients and visits over the four-year review period. Health centers were busy in 2015, providing services to over 24 million patients and conducting nearly 97 million visits. This was a major increase from 21 million patients and 84 million visits in 2012.

·         There was a substantial shift in insurance coverage over the review period. Uninsured patient rates dropped from 36% of patients in 2012 to 24% in 2015, while Medicaid coverage increased, from 39% of patients in 2012 to nearly 49% in 2015.

·         Patient growth and an improved payer mix were partially responsible for a 40% increase in revenue from 2012-2015, with health centers bringing in $21 billion nationwide in 2015.

·         Productivity declined across several functions over the four-year period, including medical visits, which decreased 12% by 2015. This decline was largely associated with health reform initiatives, including the implementation of medical records.

·         Health centers experienced a 17% increase in cost of care for both patients and visits, exceeding the U.S. medical care inflation rate.

·         An overall look at health center financial stability from 2012-2015 found that 75% of health centers operated in a steady environment, while 25% operate under fragile financial conditions.  
 
The analysis also looked at health center quartiles to examine strategies of high performers for replication, and areas of improvements for low-performers. The report was developed with support from the Health Resources and Services Administration.   
 
To access this new resource, please click here.



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Monday, September 18, 2017

Capital Link Resource Offers Guidance to Health Centers Recovering from Hurricane Damage

Community health centers located in the wake of recent hurricanes may be in the process of assessing damage and making plans to rebuild. Determining where to start and how to finance repairs, replacements, or even relocation can be overwhelming, but health centers should be aware that they may be eligible for funding and assistance through the Federal Emergency Management Agency (FEMA). Capital Link’s new resource, Hurricane Recovery Resources for Health Centers, provides guidance to health centers in need of disaster aid.

Capital Link’s resource has links to the necessary FEMA application documents, handbooks, and helpful websites, including updates from the state of Texas on public assistance process. It highlights, step by step, what to expect while working with FEMA, and what health centers can do to make the process easier. The document also reviews what FEMA may cover regarding cleanup, repairs, or replacement of facilities and equipment. Intended to help health centers through a difficult recovery process, the resource will be continuously updated as new information becomes available. As FEMA and the state of Florida assess damages and announce the disaster aid process, this document will be revised to reflect resources for health centers affected by Hurricane Irma, as well.

To access this new resource, please click here.

The Department of Health and Human Services has also issued draft guidance to help healthcare facilities with disaster planning and recovery. To learn more, please click here.

Friday, March 3, 2017

Communicating the Value+Impact of Health Centers

For more than 50 years, Federally Qualified Health Centers (FQHCs) have delivered comprehensive, high-quality preventive and primary health care services to patients regardless of their ability to pay. With revenues exceeding $21 billion in 2015, FQHCs constitute the largest network of primary care providers in the US and the second largest nonprofit health system, behind only Kaiser Foundation Hospitals. If FQHCs were listed on the Fortune 500, they collectively would rank #133, on a par with Staples and ahead of Whirlpool, Starbucks, Kraft Heinz and Facebook. However, as independently operated, locally-controlled nonprofit organizations, FQHCs focus on providing excellent care at the local level to their 24 million patients in the 9,800 urban and rural communities they serve.

The story of what health centers bring to their communities can be told along the following domains:

  1. Employment and Economic Impacts, using economic modeling software
  2. Savings to the Health Care System
  3. Access to Care
  4. Comprehensive Coordinated Care
  5. Preventive Care and Chronic Disease Management

Health centers are facing the prospect of a changing financial landscape. Now more than ever, there is a need to demonstrate the value health centers have on the communities they serve and communicate this impact. To illustrate the value and impact of health centers nationally, Capital Link has created the Value + Impact of Health Centers, an updated version of our Economic Impact Analysis. Click on the image below to view a sample of the infographic and supporting data report.



Capital Link’s customized Value + Impact of Health Centers is available for $2,000, discounted from $2,500. Order by March 17th for use at the NACHC Policy & Issues Forum.

To assist PCAs in advocacy efforts, we are also offering customized statewide and congressional district Value + Impact of Health Centers infographics and supporting data reports. Click here to view a sample of a statewide report. Interested PCAs should contact Steve Rubman, Director of Data & Information Systems, at srubman@caplink.org or 617-422-0350 for more information.



Thursday, January 26, 2017

What Can Health Centers Do to Be Resilient During Uncertain Times?

The health care landscape is evolving and changing, but patients will still need access to care and health centers will need to serve them. It is particularly important now for health centers to operate efficiently and effectively in order to weather whatever lies ahead. Capital Link has created a library of resources and tools to assist health centers in planning, whether the goal is growth, stabilization, or sustainability. Below are some strategies to consider and a collection of related resources available to health centers and PCAs.





Assess Your Financial and Operational Strength. The best way to prepare for tomorrow is to understand where you stand today by tracking performance and benchmarking results against peers and targets.

Related Resources, Services, and Programs:




Understand Your Market. Health centers should have an understanding of their communities and the unmet needs in order to identify opportunities for growth and better programs of care.

Related Resources and Services:





Develop a Strategic Business Plan. The health centers most prepared to respond to changing conditions have developed a dynamic strategic plan that they use actively.

Related Resources and Services:




Develop Your Leadership and Workforce. For the insight and agility to react to change, health centers need to have a strong board and staff. They also need to have the ability to support team-based care, recruit and retain providers, and establish project teams for expansion plans.

Related Resources and Services:




Assess Your Capital Needs and Funding Sources. Understand your need for facilities and how to finance growth.

Related Resources and Services:




Communicate Your Value. Now more than ever, it is imperative that health centers document and demonstrate the valuable impact they have on the communities they serve on national, statewide, and local levels.

Related Resources and Services:





Monday, November 21, 2016

Four Capital Link Readiness Program Participants Awarded Healthy Futures Fund Planning Grants

Capital Link would like to congratulate Avenue Community Development Corporation with Legacy Community Health, Blackstone Valley Community Health Care, Esperanza Health Centers, and First Choice Community Healthcare for being awarded Healthy Futures Fund (HFF) planning grants provided by The Kresge Foundation and Local Initiatives Support Corporation (LISC). The health centers were selected for their ability to demonstrate plans for innovative, groundbreaking capital projects (described in the box below) that involve unique collaborations with community partners to expand access to health care while also addressing at least one other critical community need, such as affordable housing, access to healthy food, job training, schools, elder care, and other community wellness projects.

Prior to receiving the grants, all four health centers participated in a free HFF Readiness Program, offered by Capital Link and sponsored by LISC and Kresge. Capital Link provided program participants, a group of 10 centers selected through a competitive application process, with technical assistance to advance their capital project plans and prepare for additional funding. A HFF partner, Capital Link developedthe Readiness Program based on our 18 years of planning and development experience in support of FQHCs nationwide.

A $200 million initiative formed by the LISC, Morgan Stanley, and Kresge, HFF utilizes New Markets Tax Credit and loan capital to improve community health by expanding healthcare access and addressing social determinants of health. Read more here.





New Markets Tax Credit Program Allocation Awards Announced

On November 17th, the U.S. Department of the Treasury’s Community Development Financial Institutions Fund announced the awardees for the combined 2015-6 round of New Markets Tax Credit (NMTC) allocations. The awards, which were increased to an historic high of over $7 billion, are aimed at revitalizing low-income communities and increasing economic opportunity nationwide. The 120 Community Development Entities (CDEs) that received these awards are actively seeking projects to finance. This is great news given that many CDEs are interested in providing financing for community health center expansion and renovation projects. For health centers needing additional funding for a project, NMTC could be the answer.

NMTC financing is a critical source of low-cost capital and equity for health center facility projects—often subsidizing project costs by 20% to 25%. In order for health centers to obtain credits with a CDE, they must demonstrate a high level of project readiness and be able to communicate the merits of their projects to CDEs with allocation. Furthermore, the process of structuring and closing an NMTC transaction is complicated and the terms, benefits, and fees offered to borrowers vary widely. 

Capital Link has extensive knowledge of the NMTC financing process and strong connections with virtually every CDE interested in working with health centers. Capital Link can provide assistance with the complex process of completing a NMTC transaction. We’ve also helped many health centers with combining NMTC financing with HRSA capital grants—an excellent option, especially for projects of $5 million or more. Our lending affiliate, Community Health Center Capital Fund, can provide leverage loans to complete the NMTC financing package, as needed.

Of the nearly $1 billion in financing obtained by health centers through the NMTC program, approximately 60% was raised with Capital Link and/or Capital Fund assistance.

For help in determining whether NMTC financing could be a good fit for your health center, please contact us here.

To learn more about the NMTC program and how it works, click here to access Capital Link’s three NMTC publications and here to access a recording of the recent webinar, Financing Health Center Projects with New Markets Tax Credits.

Wednesday, September 28, 2016

New Resource on New Markets Tax Credit Program Extension

Until recently, the New Markets Tax Credit (NMTC) Program was one of several tax credit programs that required annual approval and appropriation through the federal budget process. In December 2015, the situation changed when Congress approved the program for five more years (2015-2019) at an annual appropriation of $3.5 billion. While the program is still not permanent, this extension provides a welcome degree of certainty to the industry. Health centers with capital project plans will have the time to find and secure a site in a qualifying census tract and, if necessary, conduct a multi-year capital campaign with reasonable confidence that the credits will be available when it is ready to begin building.

Our latest resource publication, Spotlight on Capital Resources: New Markets Tax Credit Program Extension, is designed to help health centers better understand the extension and its implications. The third in a series of NMTC Program resources published by Capital Link, this resource also describes the steps necessary for preparing to utilize NMTCs for your capital project (including a discussion on new constraints on the use of the “one-day loan” structure) and the feasibility of using a “developer fee” in the transaction to increase investment in your project.

To access this new resource, please click here.


To help health centers take advantage of this opportunity, we will also be hosting a webinar, Financing Health Center Projects with New Markets Tax Credits, on Thursday, October 13, 2016, from 2-3 pm ET. This work session will acquaint participants with the benefits provided by using NMTC, how to obtain them, and how to structure and close transactions. We will discuss some near-term opportunities arising from the historically large 2015-2016 allocation round. Register by clicking here