Marrying Value-Based Payment and the Social Determinants of Health through Medicaid ACOs: Implications for Policy and Practice

State Health Policy Leadership Delivery System Reform Medicaid Social Determinants of Health

Abstract

State Medicaid programs are experimenting with two vital trends in health policy—value-based payment (VBP) and interventions intended to address social determinants of health (SDOH). We analyzed the policy levers employed by states through their Medicaid accountable care organizations (ACOs) to incorporate requirements and incentives for ACO providers to address SDOH. The policy approaches fall into three main categories: (1) requirements that providers screen for social risks; (2) requirements or incentives for partnering with social service organizations; and (3) requirements or incentives for SDOH-associated quality metrics.

As states marry VBP and SDOH interventions through their Medicaid ACOs, key policy considerations
include:

  • Integrating social risk screening into practice and achieving health provider buy-in by supporting requirements for screening and social service partnerships with provision of infrastructure funding and technical assistance to both health care and social service partners;
  • Designing provider risk sharing and payment to account for social risk on the part of the population served while taking care to protect patients’ privacy;
  • Defining and measuring outcomes by extending metrics (and payment based on those metrics) beyond screening and referral process data to track patient experiences and outcomes in both the health care and the social service sector;
  • Tracking savings across systems outside of health care, such as child welfare, education, and criminal justice; and
  • Investing in data platforms that link the health care and social service sectors and inform state policy regarding upstream gaps in the social safety net.

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