Year: 2023

Targeting solutions

Healthcare organizations have leaned on several strategies to address access gaps.

Tools meant to connect to patients virtually, like telehealth, took off as the government relaxed regulations in response to the COVID-19 pandemic, and are now commonplace. Yet many in rural and low-income communities lack broadband internet service.

Major healthcare providers and other companies have expanded into alternative care sites such as retail stores and mobile clinics. Dollar General and CVS Health, for example, have the reach to thrive in underserved markets. However, only 10{bf0515afdcaddba073662ceb89fbb62b6b1bf123143c0e06b788e1946e8c353f} of patients used retail clinics last year, according to a Deloitte survey. And some consumers have trouble navigating the healthcare system without guidance.

In Mamou, Louisiana, a town of approximately 3,000 people in Evangeline Parish, an independent drugstore open since 1975 is struggling to provide for its longtime customers. In the past year, Reed’s Pharmacy has terminated long-standing contracts with insurers and pharmacy benefit managers and has transferred patients’ prescriptions to a Walmart in the next parish.

The drugstore couldn’t get by on what pharmacy benefit managers—often part of the same corporate families as insurers and chain drugstores—charge for the medications and pay for dispensing them, said Rebecca Cormier, pharmacist and co-owner.

“Grocery stores aren’t expected to buy bread for $1 and sell it for 50 cents, but that’s what they’re expecting us to do,” Cormier said.

Reed’s is one of two drugstores in Mamou. The other is on the campus of the 60-bed Savoy Medical Center on the edge of town.

Many of Reed’s customers have patronized the store their entire lives and lack the health literacy to navigate the healthcare system without help, Cormier said. Only 12{bf0515afdcaddba073662ceb89fbb62b6b1bf123143c0e06b788e1946e8c353f} of the town’s population has a college degree and one-quarter has disabilities, according to census data.

“Some of these people can’t maneuver a phone tree,” which are used by large companies, including chain drugstores, Cormier said. “We’ve been serving third and fourth generations of families over here. If you pick up the phone, you’re talking to a pharmacist and a person—you’re not pressing ‘one’ to talk to so-and-so.”

For some drugs, Reed’s managed to keep the cash price within $20 of what patients were paying with insurance, Cormier said. But for other medicines, including those treating the many locals with asthma and diabetes, the drugstore couldn’t solve the affordability problem.

The recent contract disputes leave those customers with fewer options, especially those without access to transportation, Cormier said.

“They don’t have a way to get out of town to get their medicine,” she said. “They’re going without their medicine because we can’t fill it. No one else in town is going to do it at a loss either, so they will just go without.”

Incentivizing transformation

Emerging market forces are shaping a framework of accountability and financial incentives that aim to close gaps in care. Government agencies and third-party accreditors are imposing standards for data collection, governance and quality research.

The Centers for Medicare and Medicaid Services now evaluates how providers incorporate health equity into strategic plans, data collection and analysis, and leadership. The agency also created a “birthing-friendly” designation to encourage hospitals to close maternal morbidity gaps. The Joint Commission, which accredits about 3,800 hospitals, has devised guidelines that include designating officers to lead efforts focused on eliminating disparities and screening patients for social determinants of health.

Health equity advocates also see promise in value-based payment models, but the transition has been slow and the arrangements are not deployed in the locations where they could make the greatest difference. The Medical Group Management Association reports that value-based care accounts for just 5.5{bf0515afdcaddba073662ceb89fbb62b6b1bf123143c0e06b788e1946e8c353f} to 14.74{bf0515afdcaddba073662ceb89fbb62b6b1bf123143c0e06b788e1946e8c353f} of physician office revenue. CMS is pushing to increase participation, especially for Medicare Advantage members.

Value-based arrangements pay providers a fixed amount of money per person, per month, and allow them to decide how to spend the money. The upfront investment enables providers to build teams based on patient needs and fund community health programs. That includes hiring community health workers, dietitians and social workers or offering screenings and mobile vaccination clinics.

To make it work, providers and payers have to coordinate data and care plans, negotiate risk levels and overhaul revenue models. This would mark a major shift from the fee-for-service model, and it presents significant financial and logistical challenges to providers that benefit from the status quo. Healthcare organizations also have to reach beyond medical care and invest in other interventions to be successful.

“Old habits die hard,” said Dr. Chris Dodd, chief medical officer at Franklin, Tennessee-based home health provider Emcara Health. “Health systems have been traditionally focused on building more hospitals and hiring more specialists and using [primary care providers] to just funnel patients to higher-cost services.”

CMS’ Center for Medicare and Medicaid Innovation reported in 2021 that pilot programs testing new payment models aren’t being implemented in low-income areas. The agency is working to mitigate this by experimenting with novel payment arrangements under Medicaid and prioritizing interventions in locales identified as underserved by the Center for Health Disparities Research at the University of Wisconsin-Madison.

More flexibility for spending money on social interventions is needed and the federal government should be specific about what kinds of risk-sharing arrangements are proper and what populations should be targeted, said Hugh Lytle, founder and CEO of Equality Health, a population risk management company that enables value-based care arrangements among Medicaid and Medicare beneficiaries.

“There’s more than enough money in the system to get better results, but the incentives, even under the current value-based care systems, really encourage cherry-picking of the healthy patients and dumping of the less healthy patients,” said Dr. David Ansell, senior vice president for community health equity at Rush University Medical Center in Chicago and co-founder of the Healthcare Anchor Network.