WASHINGTON – Investment in community-based health centers could save states millions of dollars a year, according to a study conducted by The George Washington University School of Public Health and Health Services.
Though the report, "Community Health Centers in Indiana: State Investments and Returns," focused on CHCs in Indiana, the results have implications for all states, say the authors.
"Applied nationally, these findings suggest an ability on the part of health centers to 'bend the curve,' in an appropriate way, particularly for vulnerable populations," said Sara Rosenbaum, chairman of the department of health policy at GW.
Indiana is struggling with growing healthcare costs and a shrinking state budget, the report reveals. From 1984-2004, the state consistently spent a larger share of its gross state product on personal healthcare than the average U.S. state, and it is predicted that over the next 35 years, healthcare spending will absorb half of the state's budget, endangering spending on education and public safety.
Rising healthcare costs have also contributed to a 9 percent reduction in employer-based coverage in Indiana between 2001 and 2005, which has resulted in growing rolls of publicly insured and uninsured residents.
Some of the study's key findings include:
- For every dollar spent on patient care at an Indiana community health center (CHC), $1.90 is saved in overall healthcare spending when compared with other primary care settings.
- Indiana CHCs effectively target a population that is economically stressed and financially and medically at risk. Approximately nine in 10 CHC patients have incomes below 200 percent of the federal poverty level.
- Healthcare services provided at Indiana CHCs are less costly than those provided at other outpatient provider settings, with an annual per-patient cost of $1,529 at CHCs versus $2,924 in other settings – resulting in a savings of $1,395 per patient.
- Lower medical costs resulted in savings of $473 million for Indiana's healthcare system realized through the lower cost of healthcare in ambulatory health center settings as well as reduced spending on hospital emergency room use and a lower rate of inpatient hospital admission.
- In addition to direct savings to Indiana's healthcare system, each dollar spent by the state on CHCs is associated with between $6 and $17 of value, in terms of revenues generated from all sources for the delivery of services at CHCs.
Julio Bellber, president and CEO of the RCHN Community Health Foundation said the study findings underscore the importance of investments in health centers and the need to develop sustainable revenue mechanisms at the federal, state, and local levels to enhance the ability of health centers to meet these growing needs.
"Health centers in Indiana play a crucial role in providing cost effective care to a high need population, resulting in overall savings to the state's healthcare system." said Bellber. "The experience in Indiana highlights the importance of health centers to health reform."
