PCDC Testifies on Rising Health Costs Before NYC Council
Every year, rising health care costs cut into earnings of workers and their families, essentially erasing wage increases — and more. An essential solution to rising health care costs is investment in primary care, PCDC testified before the New York City Council yesterday.
“Too many Americans are just one medical bill, a hospital stay, or an emergency room visit away from a financial nightmare,” said Patrick Kwan, Senior Director for Advocacy and Communications [pictured at left].
“The evidence is clear: more primary care leads to better outcomes, better community health status, and reduced costs. Along with provider and patient satisfaction, these are the critical elements of a successful health reform approach by government, payers, health systems, and providers.”
Read the full testimony below.
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Testimony for
New York City Council Health Committee and Hospitals Committee
Joint Oversight Hearing on Rising Health Care Costs
December 12, 2019
Thank you to the City Council and committee chairs Council Member Mark Levine and Council Member Carlina Rivera for today’s oversight hearing on rising health care costs and for the opportunity to share our recommendations. I am Patrick Kwan, Senior Director for Advocacy and Communications for the Primary Care Development Corporation (PCDC).
Founded in 1993 by Mayor David Dinkins and a visionary group of health and civic leaders, PCDC is a nonprofit organization and a U.S. Treasury-certified community development financial institution that has partnered with the City of New York for over 25 years to build equity and excellence in primary care for millions of New Yorkers. PCDC has worked with over 400 health care sites to increase and improve the delivery of primary care and other vital health services across all five boroughs. We have financed and enhanced health care facilities and practices in 50 out of 51 City Council districts, including financing half of all Federally Qualified Health Centers (FQHCs) — from the smallest to the largest — in New York City. And through our national capacity building programs, PCDC has trained and coached more than 9,000 health workers to deliver superior patient-centered care, including at NYC Health + Hospitals, where we have provided technical assistance for ambulatory care redesign for more than 15 years.
Our mission is to create healthier and more equitable communities by providing the capital, advocacy, research, and expertise needed to build, expand, and strengthen our primary care infrastructure. We believe every New Yorker in every neighborhood should have access to high-quality primary care.
The unsustainable and untenable rising costs in medical expenditures — including health insurance premiums, co-pays, deductibles for provider visits and prescription drugs, and medical services not covered by insurance — are threatening the American dream of upward mobility for families and children, as well as their opportunity for prosperity and success. Too many hardworking families and individuals are just one medical bill, a hospital stay, or an emergency room visit away from a financial nightmare that jeopardizes their economic stability.
New Yorkers are right to be worried: high costs of health care and housing can drive people into bankruptcy and onto the streets. Both affordable health care and affordable housing are needed for families and individuals to pursue their careers and education, as well as preserve their prosperity and stability. A Kaiser Family Foundation poll released last year found a large majority (67%) of Americans are worried about being able to afford surprise medical bills. More than half (53%) were very worried or somewhat worried about affording their health insurance deductible, 45% about prescription drug costs, 42% about monthly health insurance premiums, 41% about rent or mortgage, and 37% about food.
Every year, rising health care costs cut into earnings of workers and their families, essentially erasing wage increases — and more. Health insurance premiums, for example, continue to rise more quickly than workers’ wages and inflation over time; since 2009, average family premiums have increased 54% and workers’ contributions 71%, several times more quickly than wages (26%) and inflation (20%).
As this year’s New York City Government Poverty Measure found, medical expenses can pull New Yorkers into poverty. Of the elements that raise the NYCgov poverty rate, medical expenses have the highest effect. In the absence of medical expenditures, the city’s poverty rate of 19% would be 2.9 percentage points or 15% lower, to 16.1%.
Medical expenses pushed more than 7 million Americans into poverty or deeper poverty, according to a 2018 national study conducted by researchers from CUNY-Hunter College, Harvard Medical School, and the Boise Veterans Affairs Medical Center. These families and individuals spent about a third or more of all their income on health care. Of the 7 million, more than half — 4 million — were pushed into the ranks of extreme poverty, where their post-health care income fell below 50% of the poverty line and they spent about two-thirds of all their income on health care. Overall, the poorest 10% of Americans had their median income reduced by 47.6%, while the wealthiest 10% had theirs reduced by just 2.7%.
Affordability is a critical component of access to health care. The availability of providers and services to a patient is only relevant if the patient can also afford the cost of the care. Half of U.S. adults say they or a family member put off or skipped some sort of health care or dental care or relied on an alternative treatment in the past year because of the cost; many say their medical condition got worse as a result. Adults who are in worse health struggle more with care affordability; 19% of adults reporting worse overall health also said that they delayed or forewent care at times due to cost, whereas 7% of adults in good health reported delaying or forgoing treatment due to cost. Uninsured adults were also more likely to delay or forego care due to cost compared with their insured counterparts (28% vs. 7% respectively).
Higher levels of comprehensive care with primary care physicians have been associated with lower Medicare costs and hospitalizations. Conversely, higher spending is not associated with better outcomes; the U.S. has some of the worst outcomes in terms of life expectancy at birth, infant mortality, and primary care quality.
Nationally, areas with higher primary care investment also have better patient outcomes. Similarly, in New York City, communities with better access to primary care have better indicators of health. Access to care in New York City varies significantly by Council District — in District 2 in Manhattan there are 64 primary care providers (PCPs) per 10,000 constituents but only 1.7 PCPs per 10,000 in District 34 in Brooklyn. Further, while many Districts have insured rates of over 90%, District 21 in Queens has 40% uninsured residents. The percentage of PCPs who accept Medicaid and Medicare also varies, impacting whether patients with public insurance can see providers in their District. This District-by-District analysis to examine primary care access across the city was made possible through a generous discretionary award from the City Council. We are extremely thankful to the City Council, Speaker Corey Johnson, and the many members of the Committees on Health and Hospitals for your continued support.
Rising health care costs coincide with rising calls for health system reform. Considering the complexity of the U.S. health care system and issues of inequity and inequality, it may seem that nothing can be done. Yet studies have found there are strategies for fixing the health system. At front of mind to many are controlling drug costs and minimizing the costs of middlemen; less apparent is prioritizing primary care.
New Yorkers need hospital beds for when we are seriously sick and emergency rooms for emergencies — and, most of all, we need primary care services to stay healthy, maintain our health from infancy to old age, and avoid costly hospital stays and emergency room visits. PCDC firmly believes that without primary care, families risk illness that can threaten their well-being and financial security as well as worsen health, social, and economic inequities. Studies show that primary care can bend the health care cost curve — but investments in primary care must go up before total cost of care goes down.
At PCDC, we recognize that the entire premise of health system reform rests on a robust, high-quality, and universally accessible primary care system. The evidence is clear: more primary care leads to better outcomes, better community health status, and reduced costs. Along with provider and patient satisfaction, these are the critical elements of a successful health reform approach by government, payers, health systems, and providers.
Primary care is the foundation for integrating the full spectrum of health and social services to improve health outcomes and the key to sustainable, accessible, and equitable health systems. It is a cornerstone of healthy, thriving communities and helps keep families healthy, children ready to learn, and adults able to pursue their careers.
Primary care is not the solution to every health issue, but there are few chronic health conditions that can be managed better without primary care.
That is why PCDC strongly supports the investments and commitments made in recent years by the City Council, NYC Health + Hospitals, the Department of Health and Mental Hygiene (DOHMH), and the de Blasio administration to enhance and expand access to primary care, including through funding for DOHMH’s Prevention and Primary Care program’s Bureau of Primary Care Access and Planning (PCAP) and Bureau of Primary Care Information Project (PCIP) as well as through initiatives such as Caring Neighborhoods, One New York: Health Care for Our Neighborhoods transformation plan for H+H, and most recently, the establishment of NYC Care and its expansion to include FQHCs and other not-for-profit and private medical service providers.
The City and H+H’s commitment to build new primary care centers in Manhattan, Queens, Brooklyn, and Staten Island, as well as expand services at existing primary care sites in the Bronx, Brooklyn and Queens, is critically important. This, along with the Caring Neighborhoods support for non-H+H facilities — in which PCDC has been a financing partner with the City — has already brought significant new primary care capacity to communities. This is a long-lasting legacy to improve the health of poorer communities in New York City, and one we applaud.
Maximizing City Council Grant Funds for Additional Primary Care Expansion
PCDC has been a strong and willing partner to the City across administrations. As a U.S. Treasury-certified community development financial institution with a mission-driven expertise in financing community-based health care, PCDC has found the most success in leveraging our resources to partner with the City and other entities, jointly financing projects for community primary care providers without recourse to bank capital. The strategy is to finance the construction, expansion, and renovation of facilities and programs through a variety of capital instruments, including public and private loans, debt, and grants. This enables the financing of key projects and ensures that scarce public resources are matched with private dollars to finance more and larger projects, all to meet the immediate and substantial needs in our communities. In addition to our technical assistance capacity, we have a variety of financing mechanisms and technical assistance available to support new or renovated primary care facilities.
Our recent financing in New York City for projects such as Apicha Community Health Center in Lower Manhattan, Callen-Lorde Community Health Center in Downtown Brooklyn, the Institute for Community Living and Community Healthcare Network’s East New York Health Hub, and the Joseph P. Addabbo Family Health Center in the Rockaways have included federal New Markets Tax Credits, New York State Community Health Care Revolving Capital Fund, and private investments in addition to City Council grants. We look forward to working with the City Council on a comprehensive strategy to maximize grant funds for financing primary care infrastructure expansion and improvement needs in our communities.
Investing in FQHCs
New York City’s nonprofit community-based Federally Qualified Health Centers provide quality primary care and other vital health services to 1.2 million patients, regardless of their ability to pay or their health insurance or immigration status. The City Council’s continued investment with discretionary funding for FQHCs will ensure their ability to sustain programs and services to serve all New Yorkers in need of high-quality, comprehensive care.
Supporting Primary Care and Behavioral Health Integration
There is a substantial need for supporting primary care and behavioral health integration. Patients with serious mental illness are often affected by chronic medical conditions. Just as it is important to integrate behavioral health into primary care settings, we must also integrate primary care into behavioral health settings to help prevent and reduce chronic conditions and promote wellness of New Yorkers.
Developing a Primary Care Plan for New York City
PCDC recommends the development of a comprehensive citywide plan to create a stronger, more sustainable, and connected primary care system. Plan components could seek to address fundamentals such as the assessment of citywide primary care capacity, performance, and needs; how primary care workforce recruitment and transformation can be supported; and capital and financing needs for facility and program expansion and sustainability.
With overwhelming evidence of its positive impact on improving health care quality and outcomes while lowering health care costs, primary care is the most reliable means of ensuring patient and community health. To meet its responsibility, primary care must be reinforced with sound policies and adequate resources. We look forward to working with the City Council to support these goals.
Thank you for your consideration of our recommendations to help build and strengthen New York City’s primary care infrastructure to help address rising health care costs and their effect on New York’s families.
Contact:
Patrick Kwan, Senior Director of Advocacy and Communications
Primary Care Development Corporation
45 Broadway, 5th Floor, New York, NY 10006
(212) 437-3927 | pkwan@pcdc.org