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FOR IMMEDIATE RELEASE: February 8, 2023

FOR MORE INFORMATION:
ACAP: Jeff Van Ness, (202) 204-7515, jvanness@communityplans.net
CHCS: Lorie Martin, (609) 528-8369, lmartin@chcs.org

NEW REPORT EXAMINES STATE EFFORTS TO SUSTAINABLY FUND EFFORTS TO ADDRESS HEALTH-RELATED SOCIAL NEEDS

WASHINGTON – A new report from the Association for Community Affiliated Plans (ACAP) and the Center for Health Care Strategies (CHCS) examines how states are financing efforts by Medicaid health plans to address social factors such as housing, nutrition, and employment that can have a powerful influence on health status, even if they fall outside the traditional boundaries of the field of medicine.

Over the last ten years, addressing these factors—known as “social determinants of health” or “health-related social needs” (HRSN)—has figured increasingly prominently in Medicaid health plans’ efforts to improve members’ health and contain growing costs. But funding streams for these efforts are not always clear; plans often pay for HRSN initiative out of funds earmarked for administrative expenses rather than benefits.

The report details how 12 states with ACAP-member plans currently finance plan activities relating to HRSN. Some states allow plans to report certain services in the medical loss ratio (MLR), for example. Other states approve plans’ HRSN services approved as benefits or in-lieu-of services, or offer incentives to reward HRSN activities.

“States increasingly recognize that addressing social determinants of health is a key part of nurturing a health-care system rather than a system of payments for encounters and procedures. It’s why virtually every state that contracts with managed care plans requires HRSN programs as part of its procurement process,” said ACAP CEO Margaret A. Murray. “States have a considerable amount to learn from one another in terms of making HRSN-related programs sustainable over the long term. To that end, this paper is an invaluable resource.”

Among the paper’s key findings:

• HRSN contract requirements are now common, but their impact on rates is unclear;
• States rely on broad definitions in federal rule when providing MLR guidance;
• States are using new and diverse managed care contracting levers to support provider-level and community-level HRSN-related activities; and
• Under new Section 1115 demonstrations, MCO capitation rates will reflect approved HRSN services like never before.

“Addressing HRSNs is critical for advancing more equitable, whole-person care, for Medicaid populations,” added Tricia McGinnis, MPP, MPH, Executive Vice President and Chief Program Officer, CHCS. “Medicaid health plans are introducing whole-person care into our health care system, but states still have a lot to sort out on the financing and logistics end. Hopefully this study can help move the needle toward further adoption of HRSN initiatives.”

To read the paper in full, including 12 detailed state-level analyses of their HRSN financing initiatives, visit communityplans.net.

 

About ACAP:
ACAP represents 78 health plans, which collectively provide health coverage to more than 25 million people. Safety Net Health Plans serve their members through Medicaid, Medicare, the Children’s Health Insurance Program (CHIP), the Marketplace and other publicly sponsored health programs. For more information, visit www.communityplans.net.

About CHCS:
The Center for Health Care Strategies (CHCS) is a policy design and implementation partner devoted to improving outcomes for people enrolled in Medicaid. CHCS supports partners across sectors and disciplines to make more effective, efficient, and equitable care possible for millions of people across the nation. For more information, visit www.chcs.org.

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