Better State Policy Needed to Address Social Determinants of Health

December 19, 2018 - A report on social determinants of health (SDOH) has five recommendations for addressing these important but often overlooked health factors with effective policymaking.

The Center for Health Care Strategies (CHCS) recently published “Addressing Social Determinants of Health via Medicaid Managed Care Contracts and Section 1115 Demonstrations” which surveys how states use Medicaid managed care contracts and state 1115 Medicaid demonstrations to address social determinants.

In recent years, the focus on the considerable impact that housing, employment, education, and other socioeconomic factors have on the health status of individuals have sharpened considerably — especially among health plans serving low-income populations. At the same time, policy challenges are pervasive given the means to address SDOH fall beyond the traditional health care system. 

Today, it is common today for state contracts with Medicaid managed care organizations (MCOs) to include provisions around social determinants. However, many states don’t clarify within the contract how MCOs can utilize flexibilities within federal law to address social determinants. Additionally, many states set goals for social determinants in contracts, yet comparatively few offer payment incentives.

Many 1115 Medicaid demonstrations seek to better address social determinants through better care coordination and cross-sector partnerships among community-based organizations, providers, and MCOs. States jumpstart these delivery system reforms with incentive payments and value-based payment initiatives.

The report details five policy recommendations in the short term. The Centers for Medicare & Medicaid Services (CMS) can improve vulnerable populations’ access to necessary health services and care coordination by suggesting modifications to demonstrations to attempt to reduce eligibility churn and heighten member engagement.

In the report, CHCS outlines five policy recommendations to support investments in SDOH: including:

• Improve access to health services for vulnerable populations
• Enhance agency collaboration at the federal level
• Provide guidance on addressing SDOH through managed care
• Approve 1115 Medicaid demonstrations that test strategies to address SDOH
• Support outcomes-based payment for SDOH interventions

“In an effort to improve health outcomes and provide more efficient care, states have increasingly incentivized or required Medicaid MCOs and other health care organizations to develop specific systems and processes to address social needs and build partnerships with CBOs and social service agencies. States have used specific authority in federal managed care rules and § 1115 demonstrations to advance this work and open up new funding streams,” the report states.

“As state Medicaid agencies and innovative health plans continue to experiment with ways to realign incentives and advance value-based care,” it continues, “many Medicaid stakeholders will continue to test innovative SDOH strategies, while watching for signals from CMS and other federal policymakers.”

A recent survey by Change Healthcare also found that 80 percent of payers believe that addressing the SDOH of their beneficiary populations will be a crucial way to improve their population health programs. The findings in the 8th Annual Industry Pulse Report indicate that payers are acting to address SDOH through community programs and screenings as a way to support value-based care initiatives.

Forty-two percent of payers are integrating community programs and resources into their population health programs. Thirty-four percent of payers said they’re combining census and socioeconomic data with clinical data to develop new insights.

Payers are starting to realize the organizational benefits and long-term returns for actively addressing SDOH, according to the authors of the survey. Over a third of payers are adding SDOH assessments to their health risk assessments, and 26.6 percent are adding SDOH into clinical workflows. Only 18.9 percent of payer organizations are not integrating SDOH in any form into population health programs.

Besides the growing movement to incorporate health impact/outcome considerations into non-health policy areas, efforts are emerging to address non-medical, social determinants of health within the context of the health care delivery system, according to the Kaiser Family Foundation. Among them are multi-payer federal and state initiatives, Medicaid initiatives led by states or by health plans. Provider-level activities focused on identifying and addressing the non-medical, social needs of their patients also is included.