As legislators debate on how to create efficiencies in health care, one study led by an Arizona State University researcher indicates that nontraditional investments in health early on can lead to long-term health benefits with cost savings.
According to the Centers for Medicare and Medicaid Services, the health of an individual is dependent on the conditions of their environment and community, called "social drivers of health," coupled with their individual social and economic needs, or health-related social needs. These can range from access to healthy foods, housing, transportation and health care — ultimate drivers of health and health care spending.
College of Health Solutions Professor Marisa Domino, who has served on the Congressional Budget Office panel in support of nonpartisan budgetary solutions, aims to understand the potential impact of North Carolina’s Healthy Opportunities Pilots program, which allows for nonmedical services to address health-related social needs, such as healthy food boxes and housing navigation, financed by Medicaid. Her findings could have implications nationwide.
Domino said she was pleasantly surprised by the rapid improvements the health interventions were able to deliver in a rather short time period versus what sometimes can take years to see decreased spending.
We talked to her about her work and what we can learn from it.
Question: What did you hope to accomplish with your pilot study in North Carolina?
Answer: We wanted to learn more about the potential impact of covering goods and services that are not traditionally covered by health insurance and what the potential outcomes could be if they were to be covered by a Medicaid program. In this case, the North Carolina Health and Human Services compared three pilot regions in a real-world setting to determine which regions would have reduced health care spending after nearly two years.
Q: What were your findings?
A: We found that Medicaid spending increased around the time that people were using new services such as healthy meal deliveries, but then decreased to a level lower than what we expected in the absence of the program. We recorded savings of $85 per beneficiary per month. This indicates that, while spending at the outset of the program is necessary, there are savings in the long run and health improvements. So while these services don’t feel essential, simple interventions save money.
For example, a child with asthma on Medicaid may go to the emergency room to get treatment for an episode and then may go back home to other issues that are contributing to the poor health, but fairly novel social-needs programs like these are demonstrating great results worth replicating.
Q: Why is it important, based on what you learned in your pilot study in North Carolina, to invest in Medicaid supported programs — such as food boxes — to individuals with limited resources?
A: We know that many people suffer health consequences of poor access to nutritious food, adequate housing and other factors. These health consequences don’t only affect individuals, families and communities, but also the health insurance programs that pay for health care spending. By using Medicaid funds to provide services such as healthy food boxes, we can actually reduce spending in the long run on reactive health services such as emergency department visits. Not only do individuals and families benefit, but taxpayers benefit, too.
Q: How do Medicaid programs create a return for tax payers in the long run?
A: By investing in preventative goods and services, Medicaid programs can save money on reactive care, such as preventable emergency department visits and hospitalizations. The Federal 1115 Waiver program, such as the one we are evaluating in (North Carolina), allows states to try out innovative programs such as the Healthy Opportunities Pilots, to allow other states to learn from each other.
Q: What is the potential impact of cuts to Medicaid?
A: There is evidence that cuts to Medicaid have increased mortality and, conversely, that expanding Medicaid can reduce the probability of mortality.
Q: What can the rest of the nation learn from your discoveries in North Carolina?
A: We certainly need replication studies to determine whether other states would have the same success as (North Carolina’s) pilot did, but this study provides evidence that there is a potential for successfully diverting Medicaid resources in ways that address factors other than direct health services that can improve health.
We believe this research provides information that can allow states to better configure Medicaid programs to provide goods and services that have direct effects on health while still saving money. This is a win for individuals, communities, and state and federal governments who pay for these services.
This is timely because there has been a large shift recently in the support for health programs. This study shows that a larger investment initially can pay off in the long run.
This article was co-written by Eden Miller, communications specialist, College of Health Solutions.
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