The 2024 Uniform Data System (UDS) offers a revealing snapshot of Community Health Centers (CHCs) navigating another year of uncertainty and transition. While the data reflect continued growth and resilience, they also highlight mounting financial and operational pressures that challenge CHCs’ ability to sustain and expand care. Below, we summarize key observations from the latest data and discuss what they mean for CHCs, patients, and policymakers.
The Good: Access Expanded
Patient volume grew again in 2024, with CHCs now serving nearly 34 million people, up from 32.5 million in 2023. This growth underscores the essential role CHCs play as primary care anchors for communities with significant health needs.
Additional signs of improved access include:
- Expansion of look-alikes: The number of look-alikes (LALs), organizations that meet federal requirements for CHC grants but do not receive grant funding, increased from 133 to 153. This expansion extended care into additional areas of high need. The number of patients served by LALs increased from 1.2 million to 1.5 million between 2023 and 2024.
- Shifts in payor mix: Across grantees and LALs, patient growth was led by approximately 823,975 privately insured patients, followed by 290,168 uninsured, and 227,601 Medicare patients.
- Slower per patient cost growth: Per patient costs increased by less than 7%, compared to 10% in prior years. This slowdown likely reflects constrained hiring, tighter financial controls, and flat or reduced revenues in many CHCs.
- Stable quality performance: Quality of care remained consistent with 2023 levels, indicating that care delivery has remained steady despite financial and operational stress.
The Bad: Financial Strains Deepen
Despite growing patient volume, CHCs reported worsening financial conditions. The national average operating margin fell to -2.4%, with a margin of –2.1% for grantees. Although overall cost increases slowed, they still outpaced per patient revenue growth, which rose by only 2.5%.
Key contributing factors include:
- Expired COVID funding: Pandemic-era supplemental funding expired and was greatly diminished entering 2024, with CHCs losing an estimated $1.5 billion.
- Medicaid patient losses: Despite a nominal increase of 16,467 Medicaid patients across all grantees and LALs, grantees experienced a net loss of 65,739 Medicaid patients.
- Decline in adult Medicaid patients: Grantees experienced a net loss of 71,500 adult Medicaid patients, reflecting the effects of Medicaid unwinding and administrative churn.
- More uninsured patients: Grantees reported an increase of 256,351 uninsured patients. Notably, children accounted for 56% of this growth.
For the first time in several years, the number of grantees dropped slightly from 1,363 to 1,359 between 2023 and 2024. The reasons for the decline are unclear, as current data does not provide sufficient detail to determine if this reflects actual closures, organizational mergers, or other factors.
The Urgent: Medicaid Enrollment Drops in Most States
The most concerning trend in the 2024 data is the widespread decline in adult Medicaid enrollment in many states (Table 1). This was largely driven by the unwinding of continuous coverage requirement that had been in place during the public health emergency. Beginning in April 2023, states began terminating Medicaid coverage, with a significant number disenrolled due to ineligibility, confusion, paperwork issues, system backlogs, or failure to complete new eligibility forms. These coverage disruptions have real consequences for continuity of care and financial stability for CHCs.
In Georgia, where Medicaid work requirements were implemented in 2023, adult Medicaid enrollment among grantees declined by 13.6%. This drop in coverage resulted in a $6.5 million loss in Medicaid revenue. While not the steepest decline nationally, it illustrates how new eligibility requirements, layered on top of the redetermination process, can intensify patient loss. Nationwide, health center grantees reported a net decline in adult Medicaid patients as the demand for care continued to rise.
Looking ahead, the One Big Beautiful Bill Act (OBBBA), enacted in July 2025, mandates work requirements nationwide. Unless these are paired with automatic exemptions and modernized eligibility systems, this policy is likely to accelerate Medicaid disenrollment and lead to more people losing insurance, undermining coverage gains from the past decade.
Twelve states reported a decline in CHC Medicaid revenue in 2024. The most significant percentage decline occurred in North Dakota (-11.0%), New York (-11.8%), and Wyoming (-14,8%). In terms of dollar losses, New York CHCs reported the largest shortfall at $204 million, followed by $22 million in Texas, $14 million in Michigan, and nearly $11 million in West Virginia. Altogether, CHCs across the 12 states reported a Medicaid loss of $306 million.
Call for Policy Action: Growth Must be Match by Stability
The 2024 data reflect a system that continues to expand access while facing significant financial strain. To sustain progress, several key policy actions are needed:
- Renew and expand CHC funding, which accounts for 10% of CHC revenue. Timely renewal is essential to prevent service disruptions. Long-term funding stability will also be essential as OBBBA policies increase demand and coverage volatility.
- Protect Medicaid coverage by ensuring consistent application and enforcement of federal exemptions that safeguard eligible beneficiaries are not disenrolled because of procedural obstacles or eligibility barriers. Simplifying renewals and reducing administrative burdens on patients and providers is vital.
- Increase national investment in primary care, recognizing it still receives less than 5% of national health spending. Strategic investment in workforce development and digital infrastructure, including telehealth platforms, and care coordination are necessary to strengthen capacity.
Recommendations for CHCs
To manage current challenges and sustain their mission, CHCs may consider the following steps:
- Plan for sustained financial constraints. With temporary funding greatly reduced and long-term CHC funding renewal still pending, CHCs should continue preparations for ongoing budget strain. Financial recovery is likely to be uneven and prolonged.
- Closely monitor state-level Medicaid changes. Understanding how states implement work requirements, define exemptions, and handle renewals will be critical for enrollment strategy and patient retention. Georgia’s and Arkansas’ experience offers a cautionary lesson. Engagement with state Medicaid agencies managed care organizations will be essential to minimize patient losses and administrative burdens.
- Focus investment on core capacity. CHCs should continue building clinical, operational, and technological capacity to ensure access and quality can be maintained under pressure.
- Strengthen strategic partnerships to fill service gaps. Collaborating with behavioral health providers, public agencies, and technology organizations can help extend reach and improve services.
- Use internal and shared data to guide decisions. Tracking patient trends, payor mix, and operational performance will support more effective planning and help advocate for necessary policy and funding changes.
What Federal and State Policymakers Can Do
Community Health Centers continue to reach more people and provide stable care under challenging conditions. However, without sustained funding, protective policies, and targeted investments in primary care, CHCs risk becoming overextended. Federal and state policymakers must provide adequate funding and implement Medicaid safeguards to ensure CHCs can continue delivering essential, affordable care to the communities that rely on them.