Adjusting for social determinants in value-based payments still fuzzy

By Sabriya Rice | January 12, 2016

There’s no question that race, gender, socio-economic status and health literacy influence a patient’s healthcare access, cost and outcomes.

But what’s still fuzzy is an understanding of which factors are within a provider’s control, and how to adjust for these factors in value-based payments, a new report says.

The U.S. government has been on an ambitious track to shift the industry toward value-based payment models and is now turning its focus to social factors.

“All other things being equal, the performance of a given health care system can undoubtedly be affected by the social composition of the population it serves,” concludes a report released Tuesday by the National Academies of Sciences, Engineering and Medicine.

In some cases, the system can itself ameliorate the impact of those social risks, the report also asserts.

The report is the first of five commissioned by HHS, which asked the National Academies to look at the issue amid the proliferation of payment reform strategies. The CMS is either financially rewarding or penalizing health providers for their performance using quality metrics that some say are flawed.

The practice has been both complicated and controversial, to say the least.

Critics have complained that a community’s socio-economic and demographic features might leave facilities in poorer areas at a disadvantage. Patients in those locations may not be able to afford follow-up treatments or may have limited access to resources, like healthy foods or therapy that leads to better outcomes.

“We don’t want to set policies that unfairly penalize providers in vulnerable populations, or policies that drive them away and cause access to care issues,” said David Nerenz, director of the Center for Health Policy and Health Services Research at the Henry Ford Health System in Detroit. “At the same time, we don’t want policies that mask or excuse true instances of poor quality.”

Nerenz is one of eight technical experts chosen to review the new report before its release. He has been studying the impact of social determinants of health at Henry Ford Hospital in Detroit. Many of the patients who visit that 751-bed safety net hospital come from neighborhoods that have low household income, limited access to fresh produce markets and few neighborhood pharmacies.

One often-cited example of the issue is mounting concern over the CMS’ readmission measure, which tracks how frequently patients return to the hospital within 30 days of being discharged.

The federal agency began cutting payments for excessive readmissions in October 2012. Most recently, a study in Health Affairs suggested that where patients go when discharged—a factor the CMS isn’t measuring—could play a key role in whether or not they get re-hospitalized.


Social factors draw CMS’ attention

The CMS announced last week it would explicitly examine whether addressing the social conditions that affect health can lower healthcare costs and improve the quality of care. The agency unveiled a new initiative called the Accountable Health Communities Model.

It’s the first federal effort to focus on how community partnerships among providers and nonmedical social support groups might improve overall healthcare delivery.

A 14-member National Academies committee, chaired by Donald Steinwachs of the Johns Hopkins Bloomberg School of Public Health, will be responsible for a series of upcoming reports from that group. These analyses will be included in HHS’ 2016 and 2019 reports to Congress.

The first report does not offer recommendations, but presents the results of an extensive literature review and outlines a conceptual framework to show how six social risk factors may impact access to care, healthcare outcomes and costs.

The second analysis will identify best practices from high performers that serve disproportionately higher rates of socio-economically disadvantaged populations.

In fact, many hospitals are initiating efforts to address disparities based on the socio-economic makeup of their communities. The Henry Ford Health System, for example, provides translators to patients who speak English as a second language as a way to improve medication adherence.

The American Hospital Association recently highlighted Main Line Health for its work addressing socio-economic barriers. In 2012, the not-for-profit health system in the western suburbs of Philadelphia launched a Healthcare Disparities Colloquium, which among other things allows second-year medical students to work one-on-one with patients at high risk for readmission, delayed care or frequent emergency department visits.

“The program not only addresses social barriers to improve health outcomes,but also contributes to the development of future health care professionals who are more cognizant of the key social determinants of health,” AHA Chairman Jim Skogsbergh said in a report for healthcare executives.

The third report in the National Academies series will try to identify what is and what is not within the providers’ control. It will specify the pros and cons of socio-economic status criteria that could be used by Medicare on quality measures and in payment programs. Recommendations will be issued in the fourth report. All reports will be summarized in a fifth report expected in 2019.

Other healthcare quality groups have been evaluating socio-economic factors and have even updated their protocols.

In 2013, the National Quality Forum, a not-for-profit that works with the federal government to evaluate the quality of measures used in federal reporting programs, convened an expert panel, to recommend which social factors should be used in risk-adjustment for performance measures. The following year the group changed its rules to allow measures to be adjusted for patients who are poor, homeless and illiterate and announced plans to examine the impact of socio-economic factors.