July 22, 2016

A new report from the National Academies of Sciences, Engineering, and Medicine says that Medicare’s value-based payment programs could take into account social risk factors – such as low socio-economic position, residence in disadvantaged neighborhoods, or race and ethnicity – but any proposal to do so will entail both advantages and disadvantages that need to be carefully considered.  

The committee concluded that a combination of reporting and accounting in both performance measures and payment are needed to account for social risk factors in Medicare value-based payment program.

Recommendations included stratified public reporting and adjustment of performance measure scores, as well as direct adjustment of payments and restructuring payment incentive design. These measures would address the committee’s four policy goals of reducing disparities in health care access, quality, and outcomes; improving quality and efficient care delivery for all patients; fair and accurate public reporting; and compensating providers fairly.

Ana Diez Roux, MD, PhD, MPH, dean and distinguished professor of Epidemiology with the Dornsife School of Public Health at Drexel University, serves on this ad hoc committee. The committee was convened by the National Academies of Sciences, Engineering at the request of the Department of Health and Human Services, acting through the Office of the Assistant Secretary for Planning and Evaluation, in order to identify social risk factors that affect the health outcomes of Medicare beneficiaries and methods to account for these factors in Medicare payment programs.

This is the third report in a series of five that addresses social risk factors that affect the health care outcomes of Medicare beneficiaries and ways to account for them in Medicare payment programs. It was outside the study’s statement of task to recommend whether social risk factors should be accounted for in value-based payment or how.

For more information, view the Report At A Glance.