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Like the fitness and longevity crazes, the health-business boom has bypassed such poverty-bound community health centers. Hospitals, HMOs, and other mainstream providers are jockeying for position in the big-money world of managed care. For-profit companies are even springing up to manage less profitable medicaid patients and take a cut of their payments. But the latest financial maneuverings are killing the city's roughly three dozen community health centers.
These are the independent clinics that treat everyone who walks in the door, sometimes receiving minor federal and state grants to offset their costs. Over the past few years, these clinics have operated in the red, losing more and more money each year, according to research done by the United Hospital Fund. Historic- ally they've spread what little they got from their patients on medicaid to cover the costs of the uninsured. But these days, fewer medicaid dollars and more uninsured patients are stretching the safety net they cast dangerously thin.
"The state just assumes some of us are going to go belly-up," says Bed-Stuy's president, Ulysses Kilgore III. "It's so unfair!" Kilgore is a small man, with a soft voice and genteel manner. But when he starts talking about the financial sword hanging over the center he's run for 17 years, he brings his fist banging down on his desk. The picture he paints is not good. The state's shift from old-style medicaid, which pays by the visit, to managed care, which pays a flat fee, cost Bed-Stuy $400,000 in revenue last year. For the coming year, when managed care is supposed to become mandatory for most medicaid recipients, the center is predicting a $500,000 loss.
It's not that Bed-Stuy is irresponsible with its money. In fact, community health centers like this one treat patients for about 70 percent of what it costs other providers, according to a recent study. They achieve such economy how- ever they can. Most of Bed-Stuy's equipment is old. Every inch of its building space is used. And the center's doctors who earn far less than others in their profession are pushed to their limit. Whether or not patients belong to official medicaid HMOs (about a quarter of them now do), they get the center's same preventive, broad-brush approach to health. Staff offer up low-fat recipes for jerk chicken, root out domestic violence, and try to find housing for their patients. Some doctors even take the time to write to workfare authorities to explain their patients' conditions. Kilgore describes this sort of humane attention as sacred. "Right and good are on our side," he says. "The universe is on our side."
The state government, however, is not necessarily on the side of community health centers. While the state has given New York hospitals $1.25 billion dollars to help them adjust to managed care money that is expected to help build clinics that will draw paying patients away from the health centers the safety-net providers have received no transition money from the state. As a result, Bed-Stuy has had to work hard to keep its insured patients. And, despite its efforts, its clientele are routinely swept away by competitors.
Each week, at least a few patients sign up with managed care companies that don't contract with Bed-Stuy, which means that the center can't get reimbursed if it treats them. According to Brenda McRae, the center's social worker, HMOs often make sales pitches to clients in the public assistance office. "A lot of these patients have been coming here for many years," says McRae. "Then all of a sudden they have this new HMO on the medicaid card and we try to explain that we do not accept this particular HMO, but they don't understand." Further confusion ensues when McRae lays out patients' options: "I say they can disenroll. But when you say disenroll, it's difficult for them to make a distinction between disenrolling from the HMO and disenrolling from medicaid," something neither the patients nor McRae wants.
But Bed-Stuy loses money even on patients whose HMOs do contract with the center. The problem, as medical director Monica Sweeney explains, is that the between $13 and $18 in monthly fees the HMOs pay the center for each patient are based on middle-class patients, who are generally healthier than those at Bed-Stuy. "When you give me the same amount of money for my patient who's got five diagnoses and five psychosocial problems as you do for somebody else, it's an injustice," says Sweeney.
You could argue managed care companies often do that the new flat rate discourages unnecessary spending, which spun out of control under the old system. Indeed, the center's building, which before the clinic arrived housed the medicaid mill that pulled off the biggest medicaid fraud in state history, is practically a monument to those old flaws. Rightly, such schemes are virtually impossible with managed care's flat rates. But the new system has created new problems: Providers complain that the rates are too low to cover their costs. And because they're flat, providers get the same piddling amount even if patients come in four times a week, which some of them do.