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Social Determinants of Health Program Generates ROI

Analysis  |  By Christopher Cheney  
   February 03, 2020

In a Pennsylvania study, decreases in cost-of-care offset the expenses of community health worker teams.

This article appears in the May/June 2020 edition of HealthLeaders magazine. 

A community health worker program focused on addressing social determinants of health can generate a significant return on investment for Medicaid payers, new research indicates.

Medicaid accounts for about one-sixth of annual healthcare spending. There are inefficiencies in this spending because it is directed mainly to treat patients as illnesses occur rather than addressing underlying factors such as social determinants of health, which include nutrition, housing, and transportation.

The new research, which was published today by Health Affairs, examines data related to the Individualized Management for Patient-Centered Targets (IMPaCT) program at a Pennsylvania-based health system. In the IMPaCT program, community health workers provide tailored social support to patients in low-income neighborhoods.

"We have described a community health worker model that achieves a favorable return on investment for Medicaid payers by effectively responding to the social determinants of health," the research article's co-authors wrote.

Research data

The researchers conducted a randomized control trial with 302 patients—150 assigned to the IMPaCT intervention group and 152 assigned to a control group. The primary analysis compared the costs of hospital inpatient admissions and outpatient visits with expenses associated with the IMPaCT program.

The research generated several key data points:

  • The annual expenses associated with a six-member team of community health workers including salary, infrastructure, and supervisory costs were $567,950.
  • The patients in the control group had 98 hospital admissions during the study's one-year follow-up period compared to 68 admissions for patients who received IMPaCT services, amounting to a 30% reduction in admissions.
  • For Medicaid payers, the average facility and professional fees cost of an admission was nearly $16,500.
  • The total annual cost of care (inpatient admissions and outpatient visits) for the IMPaCT patients was $2,450,881, compared to $3,852,189 for the control group, amounting to a 38% cost reduction.
  • A team of community health workers saved Medicaid $1,401,307 on an annual basis. When this figure was divided by the expenses of a six-member team of community health workers ($567,950), annual ROI was $2.47 for every dollar invested.

"Within a single fiscal year, the standardized, evidence-based, Individualized Management for Patient-Centered Targets community health worker program yielded an annual return of $2.47 for every dollar invested, from the perspective of a Medicaid payer," the research article's co-authors wrote.

How the IMPaCT program works

The IMPaCT program studied at the Pennsylvania-based health system has several primary elements.

  • The IMPaCT intervention features community health workers conducting interviews of patients to help determine their social needs such as housing instability and food insecurity
  • The interviews helped form individualized action plans for the patients. "For example, one patient told her community health worker that she ate unhealthy food to cope with family stress, and she wanted to find a more healthy, creative outlet. The community health worker helped her enroll in a pottery class at a local senior center," the researchers wrote.
  • The community health workers conducted weekly support groups to build social networks for patients
  • Community health workers functioned closely with primary care practices, with workspace in the practices and access to the electronic health record
  • IMPaCT is highly structured, including recommended caseloads, training courses, and quality control
  • During the study period, the community health workers were full-time employees of the health system
  • Managers are assigned to each six-member community health worker team
  • Community health workers are centralized and can be deployed to specific primary care practices or hospitals. "This centralization allows for economies of scale: Practices that can support only one or two community health workers benefit from a robust infrastructure," the researchers wrote.

Christopher Cheney is the senior clinical care​ editor at HealthLeaders.


New research finds that a community health worker program posts an annual return of $2.47 for every dollar invested.

The program helps address the social needs of patients in low-income neighborhoods.

Over a one-year period, patients receiving community health worker services experienced 30% fewer inpatient admissions compared to a control group of patients.

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