CMS recently issued guidance to state health officials designed to drive the adoption of strategies that address the social determinants of health in Medicaid and the Children’s Health Insurance Program (CHIP) so states can further improve beneficiary health outcomes, reduce health disparities, and lower overall costs in Medicaid and CHIP.
Social determinants of health describe the range of social, environmental, and economic factors that can influence health status – conditions that can often have a greater impact on health outcomes than the actual delivery of health services. The new guidance describes how states can leverage existing flexibilities under federal law to tackle adverse health outcomes that can be impacted by these social determinants and supports states with designing programs, benefits, and services that can more effectively improve population health and reduce the cost of caring for our nation’s most vulnerable and high-risk populations.
The United States spends more on health care than almost any other country yet often underperforms on key health indicators including life expectancy, reducing chronic heart disease, and maternal and infant mortality rates. According to the CMS Office of the Actuary, national health spending is projected to grow rapidly and reach $6.2 trillion by 2028. For its part, in 1985, Medicaid spending consumed less than 10% of state budgets and totaled just over $33 billion dollars. In 2019 that number had grown to consume 29% of total state spending at a total cost of $604 billion dollars.
To address the contradiction between rising costs and low health outcomes, CMS has committed to accelerating the industry’s shift away from traditional fee-for-service payment models to value-based models that hold clinicians accountable for cost and quality. “The evidence is clear: social determinants of health, such as access to stable housing or gainful employment, may not be strictly medical, but they nevertheless have a profound impact on people’s wellbeing,” said CMS Administrator Seema Verma. “Unfortunately, our fee-for-service system inherently limits the doctor-patient relationship to what can be accomplished inside the four walls of a clinician’s office.”
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