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Costs Fell by 11% When Payer Addressed Social Determinants of Health

Addressing patients’ social determinants of health and connecting them to appropriate social services could reduce healthcare costs.

Costs fell by 11% when an organization addressed social determinants of health

Source: Thinkstock

By Jessica Kent

- Organizations that account for the social determinants of health and connect patients to services that meet their social needs could reduce spending by approximately 11 percent within a year, according to a recent study.  

HealthConnections, a program from WellCare Health Plans, focuses on addressing the socioeconomic needs of vulnerable patients by referring beneficiaries to community services, such as transportation to appointments or help paying for basic utility services.  

To examine the relationship between social determinants of health and healthcare costs, the team compared the change in average healthcare expenses for patients enrolled in the HealthConnections program who had all their social needs met versus a group who had no social needs met.

The team examined patient costs in the year before the social service referral and the year after social service referral.

Although both groups saw a reduction in care costs in the year following social service referrals, researchers observed an additional 10 percent reduction for those who had their social needs met, compared to those who did not.

The group reporting that all their social needs were met experienced an 11 percent reduction, or $2601, in total healthcare costs in the year after social service referrals.

Conversely, those who reported that their needs were not met experienced only a one percent reduction in total care costs in the post-referral year.  

Additionally, the researchers examined the total care costs of a group of patients who had just one social need met and compared it to the total costs of the group who had no social needs met.

Patients who had just one of their social needs met experienced a seven percent reduction in total care costs compared to those who had none of their needs met, indicating that even limited interventions may help to significantly reduce costs and improve quality of life for beneficiaries.

“These results reinforce the need for policies that encourage organizations to accept financial responsibility for addressing social determinants of health through nonmedical interventions,” the team wrote.

“Effective healthcare delivery may require interventions from a broad array of community-based organizations that act beyond the scope of the medical care provider.”

Many payers have already been taking these strategies to heart by initiating programs that identify and address patients’ social determinants of health.

For example, Humana’s Bold Goal program has worked to implement pilots and programs in several communities across the country, aiming to alleviate issues that can come from key social determinants of health, including food insecurity, loneliness, and social isolation.

Blue Cross Blue Shield has also made strides in confronting patients’ social needs with the creation of the Blue Cross Blue Shield Institute, an organization dedicated to managing the social factors that can impede a patient’s access to healthcare.

The HealthConnections research team pointed out that there were several limitations to their study, including the fact that the social service tracking database did not record why patients reported that their needs were not met. Certain participants could have felt that the services were inadequate or perceived them negatively.

Participants also could have fulfilled their social needs with services offered outside the HealthConnections program. The team noted that the lack of detailed tracking data could introduce issues that may influence the findings of the study.

Despite this, the researchers are confident that their early results show that addressing social needs could decrease care costs.

“These primary results indicate that meeting social needs may lower total health care expenditures through a reduction in a variety of medical care service types,” the group concluded.

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