Washington’s safety net clinics face ‘perfect storm’ of federal threats

Clinics across Washington that focus on serving low-income patients are bracing for a dual threat from the federal government.

Community health centers could be especially hurt by major cuts to Medicaid included in President Donald Trump’s tax cut and spending bill. And a now-delayed federal rule change barring some immigrants from accessing certain health care services could force clinics to reject patients.

Washington has 27 such health centers, half of which serve rural communities, according to the state Health Care Authority. In the state’s 2024 fiscal year, they received $666 million in Medicaid payments.

“Community health centers really are a backbone of the primary care safety net,” said Dave Pearson, the CEO of the Washington Association of Community Health.

The clinics provide a range of services, from behavioral health care to dentistry.

And they don’t turn anyone away, regardless of insurance status. But if more and more uninsured people come in, that’ll mean community health centers bearing those costs, even with federal grants that help subsidize care.

The new law, signed July 4, is expected to cut around $900 billion of federal Medicaid spending nationwide over 10 years. Much of this reduction is tied to stricter work requirements that are expected to push people off the insurance program for low-income Americans.

Cuts to Medicaid and the Affordable Care Act marketplace could leave nearly 10 million people without insurance by 2034, according to the Congressional Budget Office.

Estimates of how many people could become uninsured in Washington vary. According to Democratic Gov. Bob Ferguson’s office, 250,000 would stand to lose Medicaid coverage, known here as Apple Health.

Meanwhile, this month, the U.S. Department of Health and Human Services announced a new policy barring many lawfully present migrants and immigrants without permanent legal status from accessing a number of federal benefits, like Head Start education programs, federally funded mental and behavioral health services, as well as community health centers.

Nationally, three in 10 immigrant adults say these health centers are their usual source of care, including 37% of lawfully present immigrants and 42% of immigrants who likely don’t have legal status, according to a 2023 survey.

Washington and 20 other states sued over the policy change, leading the federal government on Friday to agree not to enforce it until at least September.

Combine cuts to Medicaid with eliminating services for immigrants, and the changes will affect every patient at community health centers, Pearson said. 

“We’re really causing a perfect storm, if you will, for these health centers to be able to continue to provide their services in a way that is both highly accessible and high quality,” he said.

Medicaid

As of June, over 1.9 million Washington residents, including over 850,000 children, were enrolled in Apple Health, according to the state Health Care Authority. That’s roughly a quarter of the state’s population, though the total number of enrollees has been dropping for months.

Community health centers serve over a third of those 1.9 million-plus residents, Pearson said, noting that Medicaid patients make up 61% of the care delivered at these clinics.

Yakima Neighborhood Health Services, for example, served 25,000 people last year, said CEO Rhonda Hauff. Of those, 65% to 70% of patients are on Medicaid, and about 20% don’t have insurance.

“There’s going to be tough choices in the days ahead with regard to which kind of services are we able to sustain. Are we going to need to make staff changes and essentially just reductions in workforce across these centers and potentially even closing locations?” Pearson said.

Community health centers serve an especially important role in rural areas, where hospitals could be hit hard by Medicaid cuts. If those hospitals close or cut back, the health centers could be the only nearby option left for some people in the state, Pearson noted. 

The biggest change for Medicaid is new work requirements to maintain coverage. Starting as soon as 2027, enrollees will consistently have to prove they’re working, volunteering or attending classes at least 80 hours per month or show they qualify for an exemption. The mandate would apply to healthy adults up to age 64 without dependent children under 13 years old.

States have experimented with work requirements but ran into paperwork issues and added costs. In Arkansas, for example, the requirements didn’t increase employment but did result in people losing Medicaid coverage. 

“It’s not the fact that people work,” said Hauff, with Yakima Neighborhood Health Services. “It’s the administrative burden of putting the documents together and being able to produce the documents on a regular basis.”

Hauff has some experience with this. When the federal public health emergency for the COVID-19 pandemic ended in 2023, states had to restart reviewing Medicaid eligibility after a multi-year pause. 

At Yakima Neighborhood Health Services, 10,000 members needed help to renew their eligibility. Of those, 1,900 lost coverage within a year, mostly due to providing incomplete information. Another 6% voluntarily disenrolled.

“The time and the effort that was involved in finding these folks and helping them get health coverage, that was significant,” Hauff said. “We see that just multiplying.”

She worries newly uninsured patients will forgo care until their needs get serious and they end up in the emergency room. This is particularly an issue in Yakima, where hospitals are already stretched. 

“It’s very dangerous when they’re that backed up for the people that are really needed to be able to get in there,” Hauff said.

Immigrants

The federal policy change on serving migrants in community health centers could compound that issue.

These patients will likely instead be forced to seek care in emergency rooms. 

“It will be devastating if we have to change our practices,” Hauff said.

In a statement announcing the new rule last month, Health and Human Services Secretary Robert F. Kennedy Jr. said it “restores integrity to federal social programs, enforces the rule of law, and protects vital resources for the American people.”

“For too long, the government has diverted hardworking Americans’ tax dollars to incentivize illegal immigration,” he said.

Health centers don’t ask patients about their immigration status, so the change also poses an administrative hurdle.

The rule rewrite appears to conflict with federal statute requiring community health centers to serve patients regardless of immigration status.

“We’re required by federal statute and by mission to serve everyone who walks through our doors,” Pearson said. “So the policy change definitely lies in contrast with our understood mission as primary care providers.”

The new tax cut law also restricts subsidies for Affordable Care Act marketplace coverage for some lawfully present immigrants, like asylum seekers and refugees.

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