Social determinants of health matter more to health outcomes than healthcare itself. Where a person lives, their income, their access to food and housing, all of it shapes their health more than what happens in a clinic. But Medicare and Medicaid don't pay providers more for serving patients with higher social risk. Clinics in underserved communities get the same reimbursement as clinics in wealthy ones, even though the work is harder and the needs are greater.
The American Board of Family Medicine wanted to change that. They partnered withFriends From The City, Agile Six, and Social Innovation Ventures to design workshops that would bring federal officials, state Medicaid directors, health plan executives, clinicians, and policy researchers into the same room to figure out how payment models could better account for social risk.
We designed and facilitated two workshops focused on Medicare. Eighteen federal and industry experts discussed how Medicare Advantage payment adjustments could ensure that social risk payments actually address social needs rather than increasing profit margins for insurers. The second, in May 2022, brought together 22 CMS and industry experts to tackle the same question for Medicaid.
The workshops used scenario-based exercises to move participants from abstract policy discussions to concrete design decisions. Each group worked through specific payment scenarios. Should payments kick in at a threshold or follow a curve? Should data come from individual assessments or area-based indices? Should funds flow through health systems or into separate pools that clinicians could access directly?
The Medicare workshop surfaced a fundamental tension. Beneficiary-specific social need data is difficult to collect and maintain, especially for the most disadvantaged populations. Collecting it creates a burden for providers. Not collecting it means flying blind. The group recommended area-based indices like the Area Deprivation Index as a compromise: reliable, transparent, harder to game.
The Medicaid workshop revealed how much variation exists across states and communities. Solutions that work in Massachusetts, where a billion-dollar pool funds social needs without flowing through health systems, might not translate to rural states with thin provider networks. The group emphasized that flexibility was essential, but so was a common foundation. Without federal guidance, states would either not act or invent incompatible approaches.
Both workshops returned to the same question: how do you ensure that money meant for social needs actually reaches patients and communities? The answer required rethinking accountability. Resources should flow through primary care and community-based organizations, not insurers. Payment models should be hybrid or capitated, not fee-for-service. And the goal should shift from saving money to saving lives.
We synthesized the findings into two reports, each structured around key insights and actionable recommendations. The reports are now public resources, available to inform federal policy discussions.
