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If we’re not careful, value-based care could worsen health disparities

September 07, 2021
Business Affairs
Dr. John Frownfelter
By Dr. John Frownfelter

Decades in the making, the transition to value-based care may soon be complete. In June, Liz Fowler, the new deputy administrator of the Centers for Medicare & Medicaid Services (CMS) and director of its Center for Medicare & Medicaid Innovation (CMMI), suggested that CMS may soon require providers to be reimbursed based on patient outcomes. This stands in contrast to the status quo of paying providers directly for their services.

Whether this change comes to pass remains to be seen. But if it does, it will radically reshape healthcare delivery in the United States. Value-based care has tremendous potential to improve patient outcomes and lower costs. But if we’re not careful, it could have the unintended side effect of worsening existing inequities in health outcomes.

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The risk of value-based care
Value-based care has a noble goal of incentivizing providers to improve both patient outcomes and the quality of their care. Depending on the model, reimbursements may be tied to metrics including readmission rates, avoidable ED visits, or rates of hospital-acquired conditions.

But for any adverse outcome that value-based providers are trying to prevent, there are underlying, root causes that are often invisible to the care team. Up to 80% of health outcomes are determined by external, non-medical factors — none of which are easily captured in the patient’s chart. These factors can be broadly categorized as social determinants of health (SDOH): the conditions in which people live, work, and play.

Social determinants of health include factors such as whether patients live in a food desert, whether they have access to public transportation or pharmacies, or whether they can afford their medication or other health services. They can also include environmental factors such as pollution in the air or water.

By and large, however, the most detrimental social determinants are often closely linked to poverty. The result is the wide disparities in health outcomes that we see among Black, Hispanic, rural, migrant or otherwise underserved communities.

If providers don’t have the visibility to address these underlying health risks, they could end up inadvertently focusing their limited time and energy on the patients least affected by SDOH. Worse, they could end up actively perpetuating healthcare inequalities.

Case in point, a 2019 study in Science found that a predictive analytics algorithm used to help manage care for about 200 million Americans was assigning lower risk scores to Black patients relative to White patients with the same level of illness.

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