Children play during aftercare for the Head Start program, which relies significantly on federal funding, in Miami.
Paula Tomko, representing Central Virginia Health Services, has faced significant challenges securing federal funding from the Department of Health and Human Services. Her organization operates 20 community health centers across the state.
“Usually, we would submit our funding request and see the money in our account the very next day,” she stated. The organization submitted their latest request on January 24 through the Payment Management Services portal, but the funds have not yet been received. Numerous other organizations relying on the same portal reported similar difficulties accessing reimbursement funds since last week.
The issues with the payment system coincided with the Trump administration’s temporary freeze on federal grant funding, which was outlined in a White House memo issued on January 27. This memo was subsequently blocked by a federal judge and rescinded by the Office of Management and Budget.
Tomko expressed concern, stating, “We’ve been operating for over 50 years—since 1970—and we’ve never encountered this problem before. There’s a lot of uncertainty around what this means for us.” Currently, her organization has enough reserves to meet payroll for its 550 staff members, but this situation is not sustainable.
To navigate the current cash flow challenges, the organization is implementing small changes, such as limiting travel and only purchasing necessary short-term supplies. Fortunately, patient care has not yet been compromised.
However, some health care centers near Richmond, Virginia, have been forced to close and transfer patients to other facilities because they could not access federal funds.
Community health care centers play a crucial role in providing primary and preventive care to millions of patients, especially low-income individuals, whether or not they are insured. In many areas, these centers are the only options for primary care apart from hospital emergency departments.
“People assume that now that the freeze has been lifted, everything is back to normal. That’s not the case,” Tomko emphasized. “We believed we had a contract in place, but we still can’t access those funds.”
Communication Challenges
A spokesperson for the Department of Health and Human Services acknowledged the ongoing technical issues causing payment delays and stated that the department is working to resolve the matter as quickly as possible.
Community health centers nationwide have reported these funding disruptions, though the impact has varied across different states. Advocates for Community Health noted that facilities in states including Maine, Nebraska, and Illinois have been affected by funding interruptions.
Some Head Start programs, which also rely on HHS funds, have reported similar delays. “We are aware of 37 grant recipients assisting nearly 15,000 children across 20 states, as well as Washington D.C. and Puerto Rico, who are still waiting for their funds,” stated a representative from the National Head Start Association.
Tomko pointed out a lack of guidance on how to address these issues, saying, “We are not receiving any instructions on how to proceed with our requests.” Her organization had to cancel its previous request from January 24 and submit a new one without any certainty about whether this would remedy the delay.
A recorded message on the federal payment portal helpline indicates that there is currently no information available regarding payment delays, urging users to check the website for updates.
On Thursday, a group of Democratic Senators issued a letter to the acting Secretary of Health and Human Services demanding clarification regarding the funding delays.
Navigating Uncertainty in Head Start
For Head Start providers, the past week has been deeply concerning. Abbi Kruse, executive director of an early childhood center in Madison, Wisconsin, expressed her worries about the impact of funding delays on the program.
“The uncertainty has been overwhelming,” she commented. “If these delays persist, it will create significant disruptions in our operations.” Many families served by the program are on the brink of homelessness, and even short interruptions can jeopardize their ability to pay rent.
Kruse acknowledged the ongoing challenges in maintaining financial stability for the center, especially amidst rising costs. “We depend on various funding sources to ensure our program remains accessible to low-income families, and the loss of stable federal funds adds further pressure,” she said.
Recently, half of the expected funding for Kruse’s center was released, with the remainder promised soon. However, she remains anxious about future funding and program stability.
Ongoing Budget Concerns
Karen Haring, who oversees a community nonprofit in West Virginia, has also experienced challenges accessing usual funding through the HHS grant portal. This week, her organization began work on a new building that will serve as a community center and housing for young women.
The unexpected delays in funding access raise concerns about future operations. “What if we lack the staff to run our programs or manage the building?” Haring questioned.
Tomko echoed these sentiments, highlighting the looming threat of a government shutdown affecting all organizations dependent on federal health grants. “We’re currently using our financial reserves to bridge the gap, but we can’t do this indefinitely,” she cautioned, emphasizing the potential impact on patients and families reliant on community centers.
