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What to Expect in 2020: An Even Greater Focus on Social Determinants of Health

Analysis  |  By Steven Porter  
   January 02, 2020

The question now is whether emerging reimbursement models will shift things into high gear or maintain the unhurried status quo.

At the dawn of a new year in which healthcare is sure to be among the most politically charged topics ahead of this fall's presidential election, industry leaders are doing their best to anticipate what trends and twists may impact their mission.

If the past few years are any indication of what to expect, then 2020 will likely see an increased focus on the relationship between traditional healthcare service providers and the nonmedical needs that influence a patient's health outcomes.

"I think the healthcare industry, from a standpoint of mission and delivery, will increasingly acknowledge that you can't make people healthier simply by providing the conventional healthcare service. You're going to have to get involved in a broader array of social programs," says Barry H. Ostrowsky, president and CEO of RWJBarnabas Health, based in West Orange, New Jersey.

"You're going to have to invest in other services, such as housing, and chronic unemployment, and food insecurity, and safer streets, and things of that nature," he says.

The lingering question, though, is whether emerging reimbursement models will accelerate investments in these social determinants of health.

"I think the discussion around doing those social programs and how they get financed will be a dominant issue as we go through 2020," Ostrowsky says.

Lyndean Brick, JD, president and CEO of healthcare consultancy Advis, says hospital leaders generally believe social programs can deliver a significant return on investment. But there are two problems, she says: hospitals lack capital to make major investments on their own in social determinants of health, and the financial ROI for such programs doesn't accrue to the hospitals.

"Hospitals are asked to provide more service, and they want to do it, but the incentive system or the financial system hasn't been realigned to allow them to do it," Brick says.

Models Worth Watching

Although the financial incentives are misaligned, there have been some small shifts, Brick says, toward a system that more appropriately covers the costs of nonmedical social programs. "That's very, very important," she says.

Medicare Advantage: One area worth watching is the Trump administration's approach to Medicare Advantage (MA). While many value-based and risk-based contracts reimburse for nonmedical needs indirectly, the government's evolving approach to MA plans has begun allowing direct reimbursement in 2020 for supplemental benefits, such as meals and transportation, for chronically ill patients—which Brick sees as a positive development that could catch on.

"Ensuring that there is direct reimbursement is going to allow hospitals to understand that there is an ROI for addressing social determinants of healthcare, and it's that kind of direct top-line revenue impact that is going to make all the difference in the world," Brick says.

Medicare Direct Contracting: Also during 2020, healthcare providers are expected to finalize their applications and lay the groundwork for their participation in the new Direct Contracting model options being piloted by the Centers for Medicare & Medicaid Services. The agency released details in November about the new model, which is slated to begin issuing capitated reimbursement next year.

Although this particular initiative won't transform the industry overnight, it's the type of program that Ostrowsky expects to prevail.

"Medicare is trying in small dollars to introduce this idea of value and introduce this idea of seamlessness and introduce the idea of integration of various levels of healthcare," Ostrowsky says. "I think that's a very good start."

On the commercial side, Ostrowsky says, this kind of at-risk arrangement will increasingly include direct-to-employer contracts, in which providers address the overall health of a company's workforce, rather than simply treating acute medical needs.

'Medicare for All' (sort of): Democrats jockeying for a chance to challenge President Donald Trump in the general election have talked a lot about pushing toward universal healthcare, with many adopting the slogan "Medicare for All." Since voters have cited healthcare as among their top concerns—as the Trump administration continues to urge federal courts to invalidate the entire Affordable Care Act, including its protections for consumers with preexisting conditions—debate over whether and how to enact a Medicare for All system will likely continue all year long.

That's not to say, however, that such proposals are poised to be terribly consequential in the near term. Ostrowsky says the Medicare program works pretty well, but he's skeptical that Medicare for All could ever be implemented. The concept includes several political and policy considerations that will be debated fiercely, he says. His priority for now is to advocate for a policy direction that enables effective capitation.

Related: 5 Ways Healthcare Organizations Can Address Social Determinants of Health

Related: CMS Releases Details on 2021 Direct Contracting Models

Related: Social Determinants Meet the Business Case

Steven Porter is an associate content manager and Strategy editor for HealthLeaders, a Simplify Compliance brand.


Providers have known for years about the ROI social programs can deliver, but some leaders expect more acknowledgement of that fact this year.

As policy debates rage nationally, industry leaders will be looking for success stories through somewhat novel financial arrangements.

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