The US Should Change Payment To Make Health Care More Equitable

Amol S. Navathe, Risa Lavizzo-Mourey, and Joshua M. Liao co-wrote this piece as part of the Health Affairs Blog short series, “Value Assessment: Where Do We Go Post-COVID?”

From Health Affairs blog post:

As COVID-19 has spotlighted, the US health care system still produces worse outcomes for historically marginalized groups like racial and ethnic minorities and individuals with low income, compared to other patients.

By exposing existing societal fault lines, the pandemic has also shed light on reasons driving inequity. Minorities and individuals with low income often have limited resources, limited English proficiency, and limited access to healthy food, stable housing, and efficient transportation—all factors that can lead to worse health outcomes. Historically marginalized individuals and those with low income also frequently use government health insurance programs like Medicaid, which pay doctors and hospitals less than other insurers. As a result, these individuals may have fewer provider choices than other Americans and less access to services for meeting both their medical and social needs.

Changing payment won’t fix these issues by itself. But the traditional fee-for-service approach has fueled an inefficient system that fails to directly consider outcomes. Meanwhile, financial incentives and risk-adjustment approaches used in value-based programs—because they sometimes consider only clinical needs documented in insurance claims, not social ones—can penalize doctors and hospitals simply for taking care of historically marginalized patients and others with significant social needs.