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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