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What will it take to put in place the resources needed to really support people as they strive to achieve economic self-sufficiency and fulfillment? For example, can we deliver childcare that’s reliable and available every day of the year because people work every day of the year? Can we bring health care directly to our communities so people don’t have to go across town on public transportation just to get basic services?

These are questions that I’ve spent my career trying to tackle in an effort to help create better systems of care. And it’s no small feat. We’re dealing with people who are trying to manage a very complex set of life circumstances that are made even more complex by the rules of public programs on which they rely to ease their situation. Luckily, it’s a conversation that providers, payers and patients are openly having, and it’s led to a shift in how we think about delivering health care that truly improves outcomes – for life.

Trending toward managed care

Until recently, the health care industry relied on a fee-for-service system, where providers offered a menu of services and then charged for what was provided. However, approximately 80% of all Medicaid beneficiaries in the U.S. today are enrolled in a system of managed care, which rewards providers for achieving healthy patient outcomes.

Value-based purchasing, which is the heart of managed care, provides a common set of incentives to the provider and the payer to improve the quality and outcomes for patients in the services they provide. These prepaid health arrangements offer greater visibility into how much you’re going to spend and encourage competition over what works best. The crux of this approach is to solve the social ills that result in 5% of Medicaid cases accounting for 50% of the cost.

To illustrate, look at why an adult has hypertension, diabetes, COPD or behavioral health issues. You can probably trace it back to their social risk factors from childhood. In many cases, that adult grew up in a household that didn’t know where the next meal would come from or witnessed violence and death. So, to improve people’s lives and eventually tackle Medicaid costs, we first need to focus on social risk factors.

The role of social factors

Regardless of the quality and rigorousness of the implementation effort, managed care is still a big change. Just like any change, it takes time to build acceptance and adoption. It’s also important to understand that money is not the only thing we need to invest in when it comes to health care. We need to simultaneously build an environment of trust – an ecosystem of care where people’s needs are addressed holistically.

In other words, we need to make sure that a single working mother has childcare and transportation when she has a doctor’s appointment. Or that when we treat a homeless man for high blood pressure, that we also find him housing, food and continued social support. It goes to show the truth behind the adage, “you can’t just put a band-aid on a bullet wound.”

The ultimate goal is to bring payers and providers together around the risk equation. They need to be united in their common need to produce outcomes that are positive for people in order to maximize reimbursement. Because of this emphasis on the social determinants of health, we’re seeing innovative interventions emerge across the U.S. to improve the overall quality of health. This is truly a step in the right direction. After all, fulfilling the basic necessities of life – the physical and mental health of humans as individuals – is not just the right thing to do, it’s the smart thing to do.

To hear more on this topic, check out this episode of Care Ring’s Seeking the Heart podcast, where I discuss more specifically how this Medicaid transformation is evolving in North Carolina.

 

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Response:

  1. Great piece Phil! Like this excerpt – “The crux of this approach is to solve the social ills that result in 5% of Medicaid cases accounting for 50% of the cost.”

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