Senior Living Healthcare SDOH

Authored by Catherine Birdsey

The global population health management (PHM) market, including services and software, is projected to grow to $91.4 billion in 2026 from $21.4 billion in 2018, a 19.9% compounded annual growth rate, according to Fortune Business Insights. Market growth reflects the industry’s shift to value-based from fee-for-service payment models, and the resulting expansion of integrated care delivery, new tools and resources for engaging with patients, and greater data transparency and functionality.

The focus of PHM has largely been consistent, targeting improved clinical care coordination and management of complex and chronic conditions for better health outcomes and increased revenue. Healthcare providers have demonstrated success in implementing PHM strategies, but continue to be challenged to think beyond the clinical setting and respond to the social and environmental factors affecting patients. Termed the social determinants of health (SDOH), these factors will continue to push providers to engage with new and diverse partners and consider nonclinical investments as part of their financial strategy.

Healthy People 2030 defines SDOH as “the conditions in the environments in which people are born, live, learn, work, play, worship and age that affect a wide range of health, functioning and quality-of-life outcomes and risks.” These conditions are at the forefront of new PHM initiatives as providers acknowledge the nonclinical factors, such as education, poverty and housing, that predict as much as 50% of an individual’s health. Evaluating and responding to the SDOH is central to effectively and profitably managing patient health outcomes and is perhaps the single-largest opportunity for demonstrating success in a value-based care environment.

The role of SDOH in healthcare and PHM

In 2019, the Centers for Medicare & Medicaid Services (CMS) approved new waivers to address SDOH needs as part of the Medicaid benefit package. In a February 2020 research article published by Health Affairs, researchers identified 57 health systems, encompassing 917 hospitals, that implemented new programs involving financial investment in SDOH. Housing-related programs were the top investment focus area for health systems, followed by employment, food insecurity, education, social and community context, and transportation. 

The Commonwealth Fund, an organization dedicated to supporting independent research on healthcare issues, published an evidence review of studies that demonstrate return on investment (ROI) for addressing SDOH. Housing-related studies show that providing stable housing with supportive services for vulnerable populations, including senior Medicare beneficiaries and chronically homeless people, can result in decreased skilled nursing facility and long-term care days, lower healthcare costs and fewer emergency room visits, among others. Nutrition programs, such as the Supplemental Nutrition Assistance Program (SNAP) and home-delivered and medically appropriate meals, can significantly reduce 30-day readmissions, inpatient days and overall healthcare costs.

Food insecurity

One of the most visible and actionable SDOH for healthcare providers is food insecurity. Food insecurity is a direct contributor to poor health outcomes and excess healthcare costs, primarily due to a higher prevalence and exacerbation of chronic disease among the affected population. In a 2019 study, the Centers for Disease Control and Prevention (CDC) estimated that annual healthcare spending for adults who were food insecure was $1,834 higher than for adults who were not. At the county level, annual median healthcare costs associated with food insecurity was $4,433,000. To effectively address food insecurity in the healthcare setting, providers will need to move beyond baseline screening practices to sustainable response strategies that focus on integrated interventions and bring together cross-organizational and community partners.  

Other considerations

Rural America

The rural-urban life expectancy gap is widening with higher premature mortality in nonmetropolitan areas. From 1969-1971 to 2005-2009, the life expectancy difference between urban and rural areas increased from 0.4 years to 2.0 years. Lower life expectancy in rural areas is primarily due to excess death rates from chronic disease and unintentional injuries and can be traced back to SDOH differences, including poverty and lower access to care. These differences will continue to challenge healthcare systems to consider new strategies for providing care (e.g., telehealth) and nonclinical investments (e.g., food insecurity, transportation).

COVID-19

The COVID-19 health crisis has spotlighted the negative impact of SDOH on health outcomes. Low-income communities and people of color are experiencing disproportionate illness and death due to COVID-19. The APM Research Lab reported that Black individuals had the highest COVID-19 death rate of any other race, more than two times higher than for white individuals. COVID-19 health disparities have been attributed in part to SDOH, including living and working conditions, preexisting health conditions and inequitable access to care. While these disparities are not new, health equity initiatives are gaining momentum nationwide. Healthcare providers will continue to be pushed to reduce disparities in health and to assess their own practices for providing equitable and culturally competent care.

Solutions

Success in PHM and value-based care will depend on healthcare providers’ ability to respond to SDOH across diverse communities and population groups. Providers will need to strategically consider their role in addressing SDOH, both internally and as a community partner. Internal roles should address organizational processes, such as screening and data mining to identify SDOH needs and response protocols for connecting patients to needed resources. External roles are more abstract, requiring a commitment to actively engage with community stakeholders.  

Hospitals and health systems should consider conducting or refreshing their community health needs assessment (CHNA) as an essential first step in developing a SDOH strategy. A CHNA can help providers better understand their communities’ social and environmental challenges and identify potential partnerships and resources for addressing them. Correlating CHNA findings with internal healthcare utilization trends can further help providers find service delivery gaps and barriers, implement meaningful PHM programs in partnership with community agencies and demonstrate ROI through improved patient outcomes.

Ultimately, a provider should seek to develop a SDOH action plan that serves as the organization’s road map for partnership development, strategic community investments and measured outcomes to evaluate success.

For more information on this topic, or to learn how Baker Tilly’s Value Architects™ can help, contact our team.

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