The federal health center program awards grants to support health centers: outpatient primary care facilities that provide care to primarily low-income individuals. The program is administered by the Health Resources and Services Administration (HRSA)—specifically by its Bureau of Primary Care—within the Department of Health and Human Services (HHS). The federal health center program is authorized in Section 330 of the Public Health Service Act (PHSA) and supports four types of health centers: (1) community health centers; (2) health centers for the homeless; (3) health centers for residents of public housing; and (4) migrant health centers. According to HRSA data, over 9,400 unique health center sites (i.e., individual health center facility locations) exist; the majority are community health centers (CHCs). CHCs serve the general low income or otherwise disadvantaged population, whereas the remaining three types of health centers provide care to more targeted low income or otherwise disadvantaged populations (e.g., migrant health workers). Regardless of type, health centers are required, by statute, to provide health care to all individuals regardless of their ability to pay and are required to be located in geographic areas that have few health care providers. These requirements make health centers part of the health safety net—providers that serve the uninsured, the underserved, or those enrolled in Medicaid. Data compiled by HRSA demonstrate that health centers serve the intended safety net population as the majority of patients are uninsured or enrolled in Medicaid. This report provides an overview of the federal health center program including its statutory authority, program requirements, and appropriation levels. The report then describes health centers in general, where they are located, their patient population, and some outcomes associated with health center use. It also describes the federal programs available to assist health center operations including the federally qualified health center (FQHC) designation for Medicare and Medicaid payments. The report concludes with a brief discussion of issues for Congress such as the potential effects of the Patient Protection and Affordable Care Act of 2010 (ACA) on health centers (both the program and individual health centers), the health center workforce, and financial considerations for health centers in the context of changing federal and state budgets. Finally, the report has two appendices that describe (1) FQHC payments for Medicare and Medicaid beneficiaries served at health centers; and (2) programs that are similar to health centers but not authorized in Section 330 of the PHSA. The federal health center program awards grants to support outpatient primary care facilities that provide care to primarily low income individuals. The program is authorized in Section 330 of the PHSA, which also includes definitions of the four types of health centers and program requirements. This section of the report describes the statutory authority for the federal health center program (also called the health center program), program requirements, types of grants awarded in support of the health center program, the health center program's appropriation, and other funding/revenue that health centers receive. Section 330 of the PHSA authorizes grants for health centers and includes the requirements for entities to receive a health center grant. Section 330 requires health centers to provide services to the entire population of their service area regardless of ability to pay. Health centers are also required to document the health needs of the residents in their service area and to update their service area if needed. Health center grantees must (1) be located in specific geographic areas, (2) have an established fee schedule that meets certain requirements, (3) collect reimbursements for individuals enrolled in public or private insurance programs, (4) have appropriate governance, (5) offer specific health services, (6) meet certain reporting and quality assurance requirements, and (7) license providers and seek accreditation. HRSA is required to determine whether health center grantees meet these requirements; the Government Accountability Office (GAO) raised some concerns that the agency may not be providing sufficient oversight of the program and that some health centers may not be meeting these requirements. This report does not evaluate whether health centers meet program requirements; rather, it describes the program's requirements. PHSA Section 330 requires that a health center be located in an area that is designated as medically underserved or as serving a population designated as "Medically Underserved" (see text box ). Health centers must establish their own fee schedules that take into account local rates for health services and the costs that the health center incurs providing services. The health center is then required to establish a separate discounted fee schedule, which is then further discounted or waived based on a patient's ability to pay. Ability to pay is determined by the patient's income relative to the federal poverty level. The statute requires that individuals whose income is above 200% of the federal poverty level pay full charges, while individuals whose incomes are at, or below, 100% of the federal poverty level pay only nominal fees. Health centers are required to coordinate with state Medicaid and CHIP plans to provide services to beneficiaries enrolled in these programs. They are also required to seek reimbursement from third party payers such as private insurance plans, Medicare, Medicaid, and CHIP. Health centers are further required to have systems to obtain reimbursements including those used for billing, credit, and collections. These collections provide nearly two-thirds of the health center program's revenue (see Table 4 ). Although health centers collect reimbursements, GAO found that Medicare payments did not cover the full cost of health center services in nearly two-thirds of the visits they examined. Similarly, the National Association of Community Health Centers (NACHC)—the advocacy group for health centers—reports that the amount received in reimbursements is not sufficient to cover the cost of the health services provided. They found that Medicaid reimbursements covered 81% of the cost of providing services, while Medicare and private insurance reimbursements cover approximately two-thirds. The NACHC also found that the PHSA Section 330 grant amount received per uninsured patient—$312—was less than half the average health center cost per patient of $654. Health centers are required to have a governing board that is primarily made up of health center patients. The governing board provides input on center operational issues including the center's budget, operating hours, management, and oversight. It is required to meet monthly, and must approve the center's director and must approve grant applications submitted by the center. Health centers are required to provide primary care services (as defined in Section 330 of the PHSA and discussed below) and may also provide behavioral health services, case management, and specialty care services. This report section discusses the required services, as well as certain optional services, and then presents some data on services provided at health centers in 2012 (see Table 1 ). Health centers are required to provide primary health services and preventive and emergency health services. In addition to these three types of services (primary, preventive, and emergency), health centers must provide diabetes self-management training for patients with diabetes or renal disease. Primary health services are those provided by physicians or physician extenders (physicians' assistants, nurse clinicians, and nurse practitioners) to diagnose, treat, or refer patients. Primary health services include relevant diagnostic laboratory and radiology services. Preventive health services include well-child care, prenatal and postpartum care, immunization, family planning, health education, and preventive dental care. Emergency health services refer to the requirement that health centers have defined arrangements with outside providers for emergent cases that the center is not equipped to treat and for after-hours care. Health center providers must also have admitting privileges at one or more hospitals located near the health center. This requirement is intended to ensure care continuity for hospitalized health center patients. In instances where a health center physician does not have admitting privileges at a nearby hospital, the health center is required to establish other arrangements to ensure care continuity. Health centers are also required to provide enabling services such as transportation for individuals residing in each center's service area who have difficulty accessing the center, translation services, and health education. Health centers may also provide supplemental services such as additional dental care, mental health services, or substance abuse treatment. Table 1 identifies some specific services tracked in the Uniform Data System (UDS) 2012, the HRSA- required health center grantee reporting system. Health centers are required to report to HRSA certain information and to have quality improvement and assurance plans in place. First, health centers are required to report patient demographics, services provided, staffing information, utilization rates, costs, and revenue to HRSA's UDS. Second, within the UDS, health centers must report on certain clinical outcomes to assess quality. These outcomes are similar to those examined in other health care settings. They include, for example, the percentage of children receiving recommended immunizations by the age of two, the percentage of women who were screened for cervical cancer, and the percentage of patients whose body mass index was assessed and who were referred to appropriate services if found to be obese. Finally, health centers are required to have quality improvement systems in place that include clinical services, management, and patient confidentiality assurances. To meet this requirement, health centers must have a clinical director who reports on quality improvement and assurance activities and conducts periodic assessments of the health center's services to evaluate the quality and appropriateness of services provided. The HHS Inspector General found that more than two-thirds of the health centers they examined conducted quality assessments. HHS has also awarded grants to health centers to implement quality initiatives such as care coordination through mechanisms like medical homes. Health center providers must be properly licensed in the state in which they practice. They must also have admitting privileges at hospitals that health center patients would likely be referred to (see " Health Service Requirements "). Furthermore, they must maintain proper credentials during their health center employment. Health centers are not required to be accredited by a national accreditation agency, but HRSA encourages health centers to seek accreditation. Specifically, the agency encourages health centers to seek accreditation from either the Accreditation Association for Ambulatory Health Care (AAHC) or The Joint Commission (TJC).