While the adult uninsurance rate has significantly declined under the Affordable Care Act (ACA), the Congressional Budget Office estimates that up to 11 percent of the population – about 31 million individuals – will remain uninsured over the next decade. As a result, charity care programs, which provide free or low-cost health care to individuals not eligible for affordable health insurance, will continue to play an important role in the in the U.S. health care system.
To remain viable and best meet the needs of local populations, charity care programs must adapt to the changing health care environment. To do this, existing charity care programs are assuming additional responsibilities and altering their business models, while new programs are emerging to target specific groups unable to access ACA coverage.
Charity Care Programs Post-ACA
When the ACA passed in 2010, many believed the need for charity care services would decrease considerably, with most uninsured individuals enrolling in Medicaid or marketplace coverage. The 2012 NFIB v. Sebelius Supreme Court decision, making the adult Medicaid expansion optional for states, led to a different reality: as of April 2014, 7.6 million low-income, uninsured adults were excluded from Medicaid because of states that chose not to expand. In Medicaid expansion and non-expansion states alike, other individuals remain uninsured because they are non-citizens, are seeking or have received an ACA hardship waiver, or simply did not sign up for coverage.
The ACA also cut funding to the Medicare and Medicaid Disproportionate Share Hospital (DSH) programs to coincide with safety net hospitals’ presumed reductions in uncompensated care costs following the Medicaid expansion. While Medicaid DSH cuts have since been delayed, Medicare DSH reductions began as planned in October 2013. Safety net hospitals in non-expansion states are bearing the burden of reduced DSH funding without the added payments associated with seeing many new Medicaid patients; those in expansion states, meanwhile, may find the cuts partially or completely offset by ACA-related revenue increases.
Dwindling Charity Care Resources and New Program Models
While the DSH program has been a financial lifeline for safety net hospitals, independent charity care programs not affiliated with hospitals have historically relied on a variety of funding sources, including charitable giving, patient fees or contributions, and government grants. In some cases, these funding sources have dried up, as donors and policymakers assume that charity care programs are no longer necessary. For example, a Michigan charity care program, Ingham Health Plan, may lose a large source of funding—a county-based millage, or property tax, to pay for health care for the uninsured—if voters reject the tax’s renewal in November.
Even charity care programs that are affiliated with a larger health system could face financial challenges as individuals shift to Medicaid or marketplace plans with networks that may exclude health system providers or ancillary services. Under this scenario, the health system misses out on revenue from the newly insured patients, while patients may experience care disruptions as they search for a new provider. University Health System’s Carelink Program in Texas saw an approximately 25 percent decline in membership following the ACA’s first open enrollment period, thanks in large part to members enrolling in marketplace plans.
As some charity programs worry about losing newly covered patients, others are considering restricting membership to only those uninsured individuals who do not qualify for coverage under the ACA. In fact, some hospitals and community-based programs have begun turning away individuals who qualify for Medicaid or marketplace plans but choose not to enroll, in order to focus their limited resources on those without access to any form of health insurance.
Finally, many charity care programs—including Portico Healthnet in Minnesota and the Western Carolina Medical Society Foundation’s Project Access in North Carolina—have invested resources in becoming enrollment assisters, helping connect their members and other uninsured individuals with new insurance options. Many now receive state and/or federal funding to serve as navigators, in-person assisters, and certified application counselors and will play a key role in the ACA’s second open enrollment round, November 15, 2014-February 15, 2015. Some charity care programs are also taking on the role of community educator on health insurance literacy issues, including hosting workshops and meetings to educate consumers about how to use their new health insurance products and better understand insurance terminology.
A New Model of Care: Grameen PrimaCare
While existing charity care programs are adjusting to the post-ACA landscape, there is also a sense of urgency to create novel, sustainable, and culturally appropriate programs for underserved communities that do not benefit from the ACA. Grameen PrimaCare (GPC), based in New York City, is a prime example. Recently founded by Nobel Laureate Muhammad Yunus, GPC aims to provide uninsured immigrant women access to primary care services. It is also a member of the Center for Health Care Strategies’ Affinity Group for U.S. Charity Care Programs, made possible by Kaiser Permanente Community Benefit.
Grameen‘s Community-Based, Personally Accountable Approach
GPC’s new primary care and wellness program, called Grameen VidaSana, draws elements from two complementary models: (1) the Grameen Bank’s microfinance model, including regular group loan repayment meetings; and (2) the Iora Health primary care model. The program incorporates a health promotion focus consisting of weekly group health education meetings led by a health coach. Members pay a monthly $49 fee for these services, a price point determined by projection modeling and focus groups.
Grameen VidaSana is initially being offered to women participating in the Grameen America (GA) microfinance loan program and those referred through a partnership network in Northwest Queens, New York City. Launched in Jackson Heights, Queens in September 2014, Grameen VidaSana will serve up to 5,000 members at full capacity.
The Grameen model, currently incorporated in the Grameen VidaSana program, seeks to:
- Use peer supports to help women develop personal capacity for healthy living;
- Enhance community-based care;
- Focus on prevention to help reduce emergency department and hospital utilization by uninsured patients; and
- Address gaps in continuity of care for the uninsured.
Role of the Health Coach
A key to Grameen’s health model of enhanced primary care services are care teams comprised of health coaches, nurses, and a social worker, all overseen by a physician. The health coaches—comparable to community health workers or promotoras—will provide care coordination and care management, assist with health system resource and social service navigation, and lead weekly group health education sessions to help individuals manage their own health.
The model’s health education component embraces a holistic approach that integrates healthy eating and nutrition, physical activity, lifestyle decisions, sexual/reproductive health, prenatal care and maternal/child health, parenting, health literacy, domestic violence prevention, and stress management. Its interactive group sessions aim to help women become advocates for better health within their own communities.
As the ripples of the ACA continue to be felt, charity care programs must evolve to address the needs of the millions of individuals who remain uninsured or need assistance connecting to coverage. Existing programs are currently adapting to the new health care environment by becoming enrollment assisters and educators, while new programs like Grameen PrimaCare are focusing on providing patient-focused primary care to individuals left out of the ACA’s coverage reforms.
While the role of charity care programs is still evolving, charity care will remain an important aspect of the U.S. health care system as long as there are individuals unable to access affordable health care. To serve the nation’s remaining uninsured populations, there are ample opportunities for new and existing charity care approaches to better connect people to health coverage and care.