In June 2019, we invited experts from across the state to look at the health challenges New York State faces and ways to address them. Symposium organizers Thomas Gais and Manas Chatterji (at the time Senior Fellow and Nathan Fellow, respectively) synthesize and summarize the findings here.
By Thomas Gais and Manas Chatterji
New York is a national leader in responding to the fast-growing evidence that people’s health is greatly influenced by social determinants, and that the effects are greater than the impacts of medical care. The state’s governments, providers, researchers, advocacy organizations, and community leaders have contributed to many initiatives—including DSRIP, the Prevention Agenda, First 1,000 Days of Medicaid, and Health in All Agencies—aimed at mitigating the health effects of social and economic disadvantage and long-term influences such as adverse childhood experiences and environmental toxins.
It is too early to know the effects of these policies and interventions. Implementation is still incomplete. The shift to value-based payment arrangements where the contractors bear even minimal risk remains incomplete. Based on a 2018-19 survey, only 40 percent of the Medicaid Managed Care payments have achieved that goal (Level 2 or higher contracts); most contracts provide subsidies with no downside risk (Level 1).[1] The effects of interventions addressing social determinants are still unclear, as is future funding, which is expected to depend on unspecified public savings in other health areas and on partnerships with “third parties,” such as social service agencies, community organizations, foundations, and other institutions with similar interests.[2]
It is no surprise that it will take considerable patience, persistent work, and yet-to-be specified sources of funding to transform New York’s huge healthcare system into one that works with a wide range of non-health services and communities to treat health problems generated by highly unequal social and economic conditions. One general point gleaned from the symposium was that the Medicaid program has been an essential vehicle for initiating the reforms. Medicaid has funded nearly all the activities to date, largely through the federal government’s authority to negotiate waivers for innovative state programs under section 1115 of the Social Security Act.[3] Savings from reduced hospital admissions and readmissions under Medicaid have been used to establish a stronger information infrastructure for care aimed at improving health outcomes as well as subsidies for managed care organizations and providers to focus more on quality care rather than volume alone. Also, because waivers are negotiated between individual states and the federal executive branch, Medicaid waivers have offered opportunities for states like New York to adopt new approaches to care if they can find common ground with the federal administration.
To be sure, Medicaid is not a perfect vehicle. System reform will require more than the five years of the initial DSRIP (Delivery System Reform Incentive Payment) waiver, and the current administration in Washington may view DSRIP 2.0 from a perspective quite different from the one that guided CMS when the original DSRIP waiver was awarded in 2015. Budget neutrality may also be more challenging, since future savings from reduced hospital admissions and readmissions may be more difficult after years of making cuts; and without savings, fewer resources are available for investments in reform.
Nonetheless, it is important in the current fights over healthcare reform to keep in mind the value of maintaining Medicaid in something like its current form. It is a huge yet flexible and accountable financing mechanism for innovative states to respond to changing ideas and new research findings about how to increase the health of people and the communities they live in.[4] Yet some leaders in both parties are proposing ending Medicaid as we know it, as many Republicans support ending its status as an entitlement, while some Democrats push for a single-payer system that would eliminate Medicaid and state flexibility. It is unclear how advanced system reforms supported by a handful of states, like New York, could proceed under either scenario. That would not just be a loss for the states that first push for reforms. In past waves of reform, such as Medicaid Managed Care, the experiences of early adopters have led to the diffusion of similar changes among many other states.
Medicaid’s unique value lies in part in its capacity to support non-medical services. By itself, however, it cannot rectify the nation’s comparatively weak investments in policies and programs addressing social determinants. An OECD study comparing the public social spending across OECD countries found that the U.S. was high in public health expenditures (8.5 percent of GDP in 2017) but low in all other public social services (1.3 percent of GDP). Its spending on income support programs other than pensions was also among the lowest (1.9 percent of GDP).[5] And despite the extensive research on the effects of social determinants and early experiences of children for their long-term health and well-being, federal expenditures for programs benefiting children are declining.[6]
But the symposium revealed a promising development for system reform. It was clear from the participants’ discussions that many within the health care community recognize the importance of social determinants and their impacts on population health. To the degree that health plans, practitioners, and professionals are aware of the close connections between their missions and inequalities in the living conditions within the U.S., a powerful part of the U.S. economy can provide a more stable and authoritative base of support for non-medical measures to reduce social and economic disadvantages. That awareness is likely to grow; the research base is growing, and its significance is increasingly taught to health professionals. Younger physicians, for example, are more likely than older ones to believe that addressing the social needs of their patients would help them.[7] Thus, to the extent that health care professions and institutions come to see that medical care alone cannot serve their missions, and that the health of the people they serve depends on the “conditions in which [they] are born, grow, live, work, and age,” we may see a changing political frame and a growing constituency for improving those conditions.[8]
[1] New York State Department of Health, Medicaid Redesign Team, A Path toward Value Based Payment: Annual Update: New York State Roadmap for Medicaid Payment Reform, Year 5 (September 2019): 37, at https://www.health.ny.gov/health_care/medicaid/redesign/dsrip/vbp_library/2019/docs/sept_redline2cms.pdf.
[2] Ibid.: 50-51.
[3] Michael Gusmano and Frank Thompson, “An Examination of Medicaid Delivery System Reform Incentive Payment Initiatives under Way in Six States,” Health Affairs 34:7 (2015): 1162-69.
[4] Lekisha Daniel-Robinson and Jennifer E. Moore, “Innovation and Opportunities to Address Social Determinants of Health in Medicaid Managed Care,” Institute for Medicaid Innovation (January 2019), at https://www.medicaidinnovation.org/_images/content/2019-IMI-Social_Determinants_of_Health_in_Medicaid-Report.pdf. For a discussion of Medicaid’s institutional dynamics in the federal system, see Michael S. Sparer, “Medicaid at 50: Remarkable Growth Fueled by Unexpected Politics,” Health Affairs 34:7 (July 2015), at https://www.healthaffairs.org/doi/full/10.1377/hlthaff.2015.0083.
[5] OECD, “Public Spending Is High in Many OECD Countries,” Social Expenditure Update 2019 (January 2019), Figure 2.
[6] One example is the decline in federal funding of programs supporting children. See Julia B. Isaacs, et al., Kid’s Share: Report on Federal Expenditures on Children through 2018 and Future Projections (Urban Institute, September 2019), at https://www.urban.org/research/publication/kids-share-2019-report-federal-expenditures-children-through-2018-and-future-projections.
[7] Lia Winfield, Karen DeSalvo, and David Muhlestein, Social Determinants Matter, But Who Is Responsible? (Leavett Partners, 2018). The survey found that many physicians believed that social determinants are important, though most also believed that someone else was responsible for addressing them.
[8] World Health Organization, Commission on Social Determinants of Health, Closing the Gap in a Generation: Health Equity through Action on the Social Determinants of Health (Geneva, WHO, 2008), https://www.who.int/social_determinants/final_report/csdh_finalreport_2008.pdf.
