Improved Payments for Social Care Can Promote Health Equity

Despite calls for better integration of social care into healthcare delivery, the lack of adequate payment models has stymied efforts to improve health and reduce costs by paying for social interventions.

Despite major reports in 2019 and 2021 from National Academies of Science, Engineering, and Medicine (NASEM) calling on the integration of social care into healthcare delivery, the lack of payment reform has stymied efforts by clinicians and healthcare systems to address social barriers to care and social determinants of health (SDOH), according to authors in a paper published in JAMA Health Forum.

Previous research has shown that comparable countries that spend more on social services versus healthcare services had better outcomes in infant mortality, life expectancy, and potential life-years lost, compared with the United States. Similarly, within the United States, those states with higher ratios of spending on social services and public health also had better outcomes in areas like obesity and mentally unhealthy days.

“The evidence is clear and growing, prompting insurers such as UnitedHealth Group to partner with communities to build housing because it lowers medical expenditures,” the authors wrote. “Other health care organizations are implementing strategies to address social risks and social needs for patients, families, caregivers, and communities.”

However, payment reform is still needed. Some initiatives launched by CMS, such as the Accountable Health Communities model, allow for some flexibility, but these need more development and are not widely adopted.

The 2021 NASEM report focuses on the future of nursing and includes a chapter on paying for equity in health and healthcare. “Payment models can support nurses’ roles and functions to

address SDOH and advance health equity in four key areas: care management and

team-based care, expanded scope of practice, community nursing, and telehealth,” according to the NASEM report.

Despite years of efforts to move away from a fee-for-service system, that remains the way payment systems in the United States primarily pay for healthcare. However, in January 2021, CMS released a roadmap advising how states can leverage existing flexibilities that address SDOH, such as housing-related services and supports, nonmedical transportation, home-delivered meals, and more.

“Unfortunately, our fee-for-service system inherently limits the doctor-patient relationship to what can be accomplished inside the four walls of a clinician’s office,” then-CMS Administrator Seema Verma said in a statement. She added that the guidance “to state health officials highlights strategies by which states can promote a value-based system that fosters treatment of the whole person and lowers healthcare costs.”

“This guidance was released by a Republican administration; these principles are bipartisan and financially smart,” the authors of the JAMA Health Forum article noted. “State Medicaid agencies should use these flexibilities to guide health plans and health care and social care providers.”

They also recommended that CMS “accelerate learning about how integrating health and social care can improve health and reduce health care costs.”

The authors noted that both NASEM reports recommend addressing social risk factors and social needs in alignment with healthcare by expanding the workforce to include social workers and registered nurses. Under fee for service, these workers and the time they spend addressing barriers to care are recognized by Medicare with billing codes, but a physician or other qualified health professional has to initiate the services and be regularly involved.

The authors suggest that social workers and nurses should be able to lead and seek reimbursement for this work, and that making this policy change would also allow organizations in diverse communities to hire and retrain the workforce.

“Payment reform that enables clinicians and organizations to address social barriers to health offers an opportunity to address inequitable health outcomes,” the authors concluded. “As the health care workforce shortage exacerbated by the pandemic worsens, supporting social workers and nurses to address people’s social needs can prevent high-cost, downstream health care and inequitable outcomes.”