Estimated Effects of Healthcare Reform on STD Clinic Patient Generated Revenue

Background: Many public health sexually transmitted disease (STD) clinics in the U.S. closed in recent years.  The remaining clinics are increasingly pushed to increase patient generated revenue as a means to becoming financially sustainable as health care reform increases insurance coverage in the U.S. population.

Methods: We calculated the costs associated with operating a Public Health STD Clinic in Seattle, WA, and estimated the amount of patient generated revenue the clinic might obtain assuming varying levels of Medicaid and private insurance coverage among patients.  Because our clinic is part of a Federally Qualified Health Center (FQHC), we assumed that each visit by a Medicaid patient would generate $279; reimbursement for private insurance was based on visit and lab test costs, and that 88% of all billings would be reimbursed.

Results: Based on 2012 data, the clinic had 11,233 patient visits.  The estimated 2013 operating costs of the clinic are $2,863,670, or $255 per patient visit.  These costs include 40% for staff providing direct patient care, 10% for registration desk staff, 12% for administration and technical support, and 38% for medications, supplies, laboratory costs, rent and overhead.  Assuming that 50% of patients were on Medicaid and 30% were privately insured, the clinic would generate $1,048,389 in revenue or 37% of the operating costs.  If 60% of patients were on Medicaid and 30% privately insured, the clinic would recoup 43% of its operating costs.

Conclusions: Health care reform should allow our STD Clinic to recoup substantial patient generated revenue, but is unlikely to allow the clinic to become sustainable in the absence of significant increases in efficiency; provision of new, more highly reimbursable services; and continued public health funding.