Federal cuts to Medicaid have healthcare providers in the Cleveland area looking for ways to stay afloat and keep serving patients with and without insurance.
Some health systems are tightening their belts with layoffs or budget cuts.
Neighborhood Family Practice, a federally qualified health center based on Cleveland’s West Side, is expanding. The organization will open its eighth community health center in the Clark-Fulton neighborhood early next year. It will offer primary care, behavioral healthcare, midwifery and a pharmacy. As a federally qualified health center, the nonprofit provides care to everyone regardless of insurance status.
“We know that we can’t just stand still,” said Domonic Hopson, president and CEO of Neighborhood Family Practice. “But we’re leaning into those key revenue streams that we know can grow.”
That includes a focus on pharmacies – which bring in more money than many direct patient services – and on improving overall patient health outcomes, for which insurance companies can offer monetary rewards.
The center is still expecting that Medicaid cuts will hurt it financially – between $1 million to $2 million a year in lost revenue if 10% of their Medicaid patients lose coverage. But Hopson said there are no imminent plans to make cuts. The expansion of the organization is a move to avoid that.
“We know that if we’re able to expand our patients that we’re serving with insurance, it helps us cover the cost of the patients who don’t have insurance,” Hopson said. “And that’s how we’re trying to lean into this. … That’s the strategy moving forward as opposed to withdrawing.”
Other Ohio healthcare providers have recently announced cuts to their operations. Cleveland’s public hospital, MetroHealth, laid off 125 employees in July, in part as preparation for “expected changes in government policy.” Planned Parenthood of Greater Ohio laid off 20 people in light of federal funding cuts. And Cuyahoga County’s ADAMHS board is preparing to dole out less money next year to local providers working on alcohol, drug addiction and mental health. That’s in part due to “current and anticipated budget constraints at the federal, state and local levels,” the agency said in a budget plan.
Neighborhood Family Practice leans into ‘value-based care’
The new health center in Clark-Fulton will offer more than just primary care. Patients can also get psychiatry and counseling services, pre- and post-natal care for mothers and a pharmacy.
That’s intentional, Hopson said, as a way to offer more “integrated” care – i.e., more coordination and collaboration between various healthcare services that might traditionally be located in different places.
Neighborhood Family Practice said that facilities with various types of healthcare onsite improve patient health overall. For example, patients are more likely to fill their prescription at the location where they just saw the doctor as opposed to having to go to another location, Hopson said.
“We know that our patients have the best outcome when we have clinical pharmacy, primary care, nursing and behavioral health in one location,” Hopson said.
Better patient health can actually bring financial benefits to the nonprofit, Hopson said. When patients are healthier – say, their conditions such as diabetes or hypertension are under control – insurance companies save money. The companies can share these savings with organizations like Neighborhood Family Practice under what’s called “value-based care” arrangements.
“The insurance companies are rewarding the organization for providing value and controlling costs, but also improving the outcomes of patients with chronic conditions,” Hopson said.
Neighborhood Family Practice earned over $1 million in the last three years from these arrangements, it said.
The growth of nonprofit pharmacies
The new facility in Clark-Fulton will also have a full-service pharmacy.
This is in response to the growing challenge of “pharmacy deserts,” the organization said. More than 200 pharmacies closed across Ohio in 2024, according to the Health Policy Institute of Ohio. In Cuyahoga County, pharmacies ranging from CVS to Rite Aid to Walgreens have closed in recent years. Two pharmacies remain down the street from the new Neighborhood Family Practice facility in Clark-Fulton.
By opening pharmacies, Neighborhood Family Practice can also bring in dollars it needs to sustain itself, Hopson said.
That’s because Neighborhood Family Practice operates what’s called a 340B pharmacy, a government program that allows certain types of health centers to buy drugs at reduced cost.
Uninsured patients receive those savings on their prescriptions, Hopson said. But for patients with insurance, Neighborhood Family Practice will bill insurance companies the full retail price of the drug.
“So you have that spread of revenue that we then put back into our organization,” Hopson said.
The 340B program has recently drawn scrutiny from members of the U.S. Senate, over concerns that some users of it were not passing enough savings on to patients.
Neighbors, Spanish-speakers looking forward to clinic
The new facility in Clark-Fulton will be in a building that also has affordable housing and bilingual childcare services. The Clark-Fulton neighborhood has a large concentration of Hispanic residents.
The Spanish American Committee, which will be running the childcare center, believes the on-site clinic will make healthcare more accessible for neighbors and Spanish speakers.
The committee works closely with Neighborhood Family Practice and often refers patients there, said Haley De Leon, a social services coordinator at the Spanish American Committee.
“A lot of their staff are bilingual, which we’ve noticed in our work just creates a different level of comfort for patients when they feel like they can speak in their native language,” De Leon said.
De Leon added that the location in the Clark-Fulton neighborhood will also help neighbors without cars get to the doctor more easily.
Neighborhood Family Practice is also ready to serve patients at the new facility who come from outside Cleveland. The organization is seeing more residents from the suburbs of Cuyahoga County.
“We think it’ll better serve some of those patients that have been driving, both from the Parma and Parma Heights area, but also those patients that are coming from Garfield Heights and Maple Heights,” Hopson said.