Obamacare Threatens Free Clinics

Obamacare’s most significant effect is an expansion in the number of people dependent on Medicaid, the joint state-federal welfare program for low-income people. Kaiser Health News points out that this expansion is threatening the existence of free clinics. Some clinics are signing up for Medicaid, while others are closing:

“We used to say … ‘wouldn’t it be great if we no longer had uninsured and we could close our doors and go out of business,'” said Michelle Goldman, CEO at the Eastern Panhandle Care Clinic in Ranson, W.Va., which is one of the free clinics now also taking Medicaid. “But the truth is we like the work we do and enjoy helping this population and believe we still have a lot to offer them.”

While a few free health clinics have shut their doors in Arkansas and Washington, most expansion-state non-profit free clinics are reassessing their business strategies. Medicaid offers the potential to give their patients better access to specialists, diagnostic testing and hospital care, and that’s created a sense of unease for operators of the clinics that for decades have played a key role in the nation’s health-care safety net.

“These changes have caused some real disruption in the free clinic sector trying to anticipate what it means for patients who continue to need our services, and how we can sustain ourselves,” said Marty Hiller, senior consultant with Echo, a consulting firm that works with free clinics. “It’s been a tremendous upheaval.”

The nation’s loosely organized network of free clinics have come a long way since the 1970s when most were made up of volunteer doctors and nurses working a day or two a week in church basements. Today, about 1,200 free clinics serve about 6 million patients, according to the National Association of Free and Charitable Clinics. Their increasingly modern facilities look much like private medical offices that serve patients with insurance. They often use electronic medical records, pay administrative staffs and nurse practitioners, and run their own pharmacies.

Unlike the nation’s community health centers, which receive billions in federal funding and are a key part of the health law’s push to expand access to health care, free clinics have traditionally relied on private donations, and state and local assistance. Community health centers, which also treat poor patients, charge patients above the poverty level on a sliding fee scale and are paid a higher Medicaid fee than private physicians.

The assertion that Medicaid dependency increases patients’ access appears unfounded: Medicaid patients have terrible access to physicians. It does not appear that access to care has changed for these patients – at least in the short term. However, the change in cash flow means that the clinics are now more accountable to the federal government than private donors and local government. That will likely increase the bureaucratic burden and decrease quality of care in the long term.