Health Care Infrastructure and Safety-Net Providers

On this page: Medicaid


Some people in the US lack meaningful access to basic health services. These populations tend to be disproportionately low-income, uninsured, of limited English proficiency and, in the case of rural areas, older. In addition to lack of health insurance, several factors account for this: a scarcity of providers, physical barriers that make reaching providers difficult, services that are not available at times when consumers can access them, and a lack of providers who are proficient in the population’s spoken language and/or are culturally competent.

Several provisions in the Affordable Care Act (ACA) have an important impact on the health care infrastructure and the continued viability of the safety net.

Rural Community Hospital Demonstration—since 2004 the Centers for Medicare & Medicaid Services have been conducting a five-year Rural Community Hospital Demonstration Program as authorized under the Medicare Modernization Act of 2003. The demonstration was scheduled to end in 2010 but the ACA extended this deadline to December 31, 2016. The ACA also expands the number of participating hospitals from 15 to 30 and increases the number of participating low-population states from 10 to 20. The program will test the feasibility of reasonable cost reimbursement for inpatient services to small rural hospitals. It is aimed at increasing the capability of the selected rural hospitals to meet the needs of their service areas.

Rural Demonstration Project—the Medicare Improvements for Patients and Providers Act of 2008 authorized a demonstration project to allow eligible entities to test new care delivery models in rural areas. The project’s goals are to increase access for Medicare beneficiaries and to promote care integration.

The ACA expands this demonstration to allow additional counties and doctors to participate. The ACA also removes rural health clinic services from the list of services that a Critical Access Hospital must furnish in order for its county to participate. Finally, the ACA adds physician services to the list of other essential health care services covered by the demonstration. As a result, eligible entities may be reimbursed for their reasonable costs for furnishing physician services.

Improvements in cultural competency—the ACA authorizes the Health Resources and Services Administration to award grants, contracts, or cooperative agreements to enhance health professionals’ knowledge and skills in several areas, including cultural competency. They may be awarded to public and nonprofit entities to conduct training activities in cultural competency, public health, prevention, reducing health disparities, and working with individuals with disabilities.

Individualized wellness plans—the ACA created an individualized wellness plan pilot program. It requires the Department of Health and Human Services (HHS) to enter into contracts with ten community health centers (CHCs) to test the impact of providing at-risk populations who use CHCs with individualized wellness plans that are designed to reduce risk factors for preventable conditions.

Community health centers—the ACA requires the federal government to set aside funds for qualified CHCs. The centers will be allowed to contract with federally certified rural health clinics, critical access hospitals, sole community hospitals, or Medicare disproportionate share hospitals (DSHs) to provide whatever primary health care services those clinics and hospitals currently offer to people who are eligible for free or reduced-cost care, and who are eligible to receive those services at CHCs.

Training programs for community health workers—the ACA establishes a new training program for community health workers to promote positive health behaviors (e.g., good nutrition) and discourage risky behaviors (e.g., tobacco use) among medically underserved populations.

Reductions in disproportionate share hospital payments—the Medicaid DSH program provides payments to hospitals in order to support services provided to low-income individuals. These payments are critical to hospitals that serve low-income patient populations and are more dependent on government payers for their revenues than are other hospitals. The ACA requires the HHS secretary to reduce federal matching funds for state Medicaid DSH allotments in order to achieve specific savings targets.

Health Care Infrastructure and Safety-Net Providers: Policy

Language access

In this policy: FederalLocalState

All levels of government should adopt policies ensuring that people who do not speak English or are limited in English proficiency have adequate language access to their health care provider.

All levels of government should also ensure that those who provide professional language services are adequately trained, certified, and compensated.

Safety-net facilities

In this policy: FederalLocalState

Notwithstanding the fact that millions of people will receive access to health insurance coverage because of health reform, federal, state, and local governments should take steps to ensure adequate funding for safety-net providers so that the needs of those who remain uninsured are met.

All levels of government should ensure that publicly funded interventions are sensitive to communities’ special needs and preferences.

Reductions in Disproportionate share hospitals (DSH) payments

In this policy: FederalLocalState

In light of the statutory reduction in federal DSH payments and the resulting negative impact on safety-net health funding, states should expand their Medicaid programs to cover all eligible individuals with income at or below 138 percent of the federal poverty level.

States that do not expand their Medicaid programs should have concrete and transparent plans for making up the safety-net funds that will be lost because of cuts in federal DSH payments. In addition, these states should demonstrate adequate safety-net capacity.


In this policy: FederalState

Federal and state governments should provide incentives for health educators to conduct training in medically underserved areas, and for programs that encourage physicians, nurses, and other health care personnel to practice in medically underserved areas. Incentives might include targeted scholarships and grants, student loan forgiveness programs, training stipends, and other financial innovations.

Federal and state governments should establish programs to recruit and train health care providers to work in rural and urban underserved areas. In addition federal and state governments should target education subsidies to those health care professions in which practitioners are in shortest supply.

Federal and state governments should take steps to ensure that grants awarded to public and nonprofit entities to address certain curriculum issues among health providers (namely, cultural competency, public health, prevention, reducing health disparities, and working with individuals with disabilities) are rigorously evaluated and best practices quickly disseminated.

Access in rural areas

In this policy: FederalState

Federal and state governments should help rural communities improve local access to health care by facilitating community-based discussions about potential solutions for access problems and by providing:

  • relevant demographic and utilization data;
  • appropriate incentives for managed care plans to extend needed coverage to rural areas;
  • incentives and assistance in recruiting and retaining all types of health care personnel; and
  • technical assistance to rural and underserved communities that seek to develop delivery systems and identify alternative ways to provide access to health care (such as tele-medicine systems and improved transportation resources).

Uncompensated care

In this policy: FederalState

Federal and state governments should adopt policies that:

  • encourage nonprofit hospitals to provide free care to people who are indigent and lack access to health insurance coverage,
  • either require or encourage for-profit and nonprofit hospitals to charge uninsured people discounted prices comparable to those negotiated with insurers, and
  • prevent both types of hospitals from engaging in onerous debt collection practices against people who are indigent or uninsured.

Federal and state governments should require hospitals to freely disclose information about charity care and about discounts available to qualified patients. In addition federal and state governments should require hospitals to make information about their prices available to patients at any time so that they can anticipate the costs of care.

States should monitor the level of uncompensated care and other community benefits provided by nonprofit hospitals, and should evaluate whether those benefits are commensurate with the value of the tax exemptions the hospitals receive.

Individualized wellness plans

In this policy: Federal

The federal government should take steps to ensure that people who receive individualized wellness plans through community health centers are monitored to ensure that the plans adequately respond to their health needs. Special attention should be given to plans for patients with multiple chronic illnesses.

Training for community health workers

In this policy: FederalState

States and the federal government should ensure that community health worker education includes training in working with an older adult population.


In this policy: FederalLocalState

Until health care coverage is attained for all, federal, state, and local governments should support efforts to create and maintain access to health care for the uninsured through innovative community-based approaches, such as the use of volunteer health care personnel and donated medical equipment.

In all cases where health care is offered through voluntary efforts or donated equipment, consumer protections should be maintained by checking the adequacy of professional licenses, ensuring practice competencies, retaining a patient’s right to full and just compensation for injuries resulting from inappropriate care, ensuring adequate malpractice insurance coverage for volunteers, and implementing other appropriate quality-control measures.

Volunteer efforts cannot fully or adequately address the problems of the uninsured, but they are a valuable component of the safety net.