Adding social services to US clinical care makes “good business sense,” report argues

Changes in the way US healthcare providers are paid have meant that it now makes “good business sense” for them to address patients’ social needs as well as their medical problems when they attend a clinic, a foundation sponsored report has argued.1

“What was once a path pursued by a handful of mission driven providers and grant funded social services organizations may soon become the standard of care, demanded by payers, policymakers, and consumers alike,” the report said. Addressing Patients’ Social Needs: An Emerging Business Case for Provider Investment was prepared by the consulting company Manatt Health Solutions and was funded by the Commonwealth Fund, the Skoll Foundation, and the Pershing Square Foundation.

Traditionally, US healthcare providers have been paid primarily for visits, tests, and procedures on a fee for service basis. This payment system gave little or no financial incentive for providers to address their patients’ social needs, the report said. But research has shown that as many as 40% of health outcomes were attributable to social and economic factors, the report noted, including studies that linked low socioeconomic status to general poor health, chronic diseases, higher infant mortality rates, and lower life expectancy.

If healthcare providers were to thrive with new “value based” payment systems that tie reimbursement to the health of their patients and the cost of care, the report contended, providers would have to do more to tackle the social factors in the health equation.

Addressing patients’ social needs will be especially important for providers caring for the estimated 32 million people in the United States who are projected to obtain insurance through the Affordable Care Act, the vast majority of whom have low or modest incomes. “For many of these individuals, their social and economic circumstances will be a defining feature of their health,” the report said.

Some value based contracts either require providers to include social support or allow them to dedicate funds to social services. In the state of Oregon, for example, 90% of Medicaid patients are enrolled in coordinated care organizations, which have to help their enrollees gain access to social support services. “Emergency department visits declined by 9% among people served by [coordinated care organizations], and hospital admissions for individuals with certain chronic conditions dropped by up to 29%, according to the state,” the report said.

A Medicare accountable care organization run by the Montefiore Medical Center in New York City partnered with community organizations to provide “wraparound” services for high risk patients, which included help with housing, employment, and transportation. “In its first year as an [accountable care organization], Montefiore reduced the cost of care for its 23 000 Medicare patients by 7%, and earned some $14m [£8.2m; €10.4m] in shared savings payments,” the report said.

The types of social support services to which health providers might connect their patients included nutrition programs, programs that provide legal help related to housing code violations and utility shut-offs, and programs that help people apply for disability benefits and other public benefits. One program, for example, allowed healthcare providers to write prescriptions for patients’ basic needs, such as food and heat, which were then “filled” by hospital or clinic volunteers who connected patients with the appropriate resources.

The report said that some providers had already recognized that such programs yielded direct and indirect benefits that justified their cost, but that for those who were unwilling to channel their revenues into social service support, “community benefit” spending could be a source of funding.

“To justify their tax exempt status, nonprofit hospitals must provide a community benefit usually equal to the value of their tax exemption—estimated to total $13bn annually,” the report noted. “While the majority of community benefit dollars have historically gone toward care for underinsured and uninsured patients, expanded coverage under the [Affordable Care Act] should enable providers to shift some funds to programs that target social needs.”