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Boosting the First Line of Defense for America’s Most Vulnerable Population

The United States leads the world in the number of COVID-19 cases and deaths, with the pandemic disproportionately impacting low-income people and communities of color as well as the providers that serve them. At a recent BPC event, family physician Dr. Kelly Thibert, representing the American Academy of Family Physicians noted that many of her patients are essential workers who have Medicaid coverage. As essential workers, they are unable to social distance and risk exposure to coronavirus every day. Some essential workers are uninsured because they earn too much in states that have not expanded Medicaid or are eligible but have not enrolled. COVID-19 has highlighted the need for a comprehensive primary care system in Medicaid, the nation’s safety net.

Medicaid is a vital source of coverage for many vulnerable communities. Medicaid providers, especially primary care providers, have faced serious financial challenges given decreased utilization in elective care. They are also seeing increased costs from COVID-related procedures, combined with traditionally low Medicaid payment rates, and will face greater demand from an increase in Medicaid eligibility as additional individuals qualify for the program. A survey of primary care providers generally found that over a third of those responding indicated that they were not ready to deal with the surge of COVID-19 cases. Forty percent were not ready for a second wave in the fall and forty percent also said they were uncertain they would still be open in four weeks. Looking beyond the crisis, high-need patients with complex medical needs, who either chose to or were asked to forego treatment during the pandemic will have significant unmet needs. Additionally, many primary care practices, especially those serving Medicaid beneficiaries, may face closure or acquisition by larger health systems. Both factors could simultaneously lead to an increased need for high-quality, comprehensive primary care, and reduced access and appointment availability.

States have indicated that they will be forced to find ways to reduce spending on Medicaid and other programs due to budget shortfalls resulting from the pandemic’s negative economic impacts on states. One way states have reduced Medicaid spending in previous economic downturns has been through reductions to provider rates, which are already low and a barrier to primary care access. In response, states and providers have asked the federal government to step in. Following passage of the Coronavirus Aid, Relief and Economic Security Act and the Paycheck Protection Program and Health Care Enhancement Act, the U.S. Department of Health and Human Services (HHS) has taken action to help Medicaid providers by announcing that $175 billion be appropriated through two pieces of legislation — $15 billion would go to Medicaid and CHIP providers and $12.8 billion would go to safety net hospitals. To increase access to services, Congress should increase federal match rates in Medicaid to 100% for states that increase Medicaid primary care services to Medicare rates. This should include telehealth services. As Ben Schaffer, Rhode Island’s Medicaid Director, noted at the July 7th event, such a policy would have a “tremendous impact and tremendous return on investment.”

Recent funding initiatives targeting Medicaid/CHIP and safety net hospitals did not provide funding to community health centers, which provide comprehensive primary care to almost 30 million vulnerable Americans, with 49% of whom are insured through Medicaid. While community health centers estimated a need of $3 billion, HHS has provided only $1 billion from the $30 billion in grants to Medicare providers. The Community Health Center Fund that accounts for 72% of health center funding is also set to expire in November. The Wall Street Journal reported that 2,000 health centers have closed temporarily, threatening to exacerbate serious racial and ethnic disparities. Congress should reauthorize mandatory and discretionary funding at current funding levels of $5.6 billion annually for the Community Health Center Fund to ensure continued access for vulnerable populations and reduce the burden on hospitals and emergency rooms.

This public health crisis has also presented an opportunity for innovative solutions to new challenges in primary care delivery. Many providers have mitigated declines in revenue by increasing their use of telehealth while some have benefited from participation in value-based payment models. Providers and states with less experience and resources would benefit from opportunities to learn lessons from those with greater experience. BPC’s report includes a recommendation to help providers and states share best practices on these and other topics. Specifically, HHS should support learning collaboratives and researchers to elevate primary care as a priority in the Medicaid program and share best practices on primary care among states. Congress should also fund the Primary Care Extension Program to support practice transformation. These recommendations would help providers, including small group practices, overcome barriers to payment transformation and innovation in service delivery.

These and other recommendations included in BPC’s report address the challenges faced by primary care providers during the pandemic, and represent a necessary investment in primary care to improve patient access to primary care services. Even before COVID-19, there were challenges to the delivery of primary care services in Medicaid. The pandemic has exacerbated these challenges and the crisis. We hope policymakers will consider these proposals as they move forward developing legislation to address access to primary care and to improve outcomes and reduce disparities.

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