Addressing the Social Determinants of Health Through Medicaid Managed Care

With its emphasis on coordinated care and prevention, managed care should be tailor-made to tackle social determinants of health. But various challenges discourage Medicaid health plans and providers from assisting beneficiaries with nonmedical concerns such as housing insecurity or parenting skills that are integral to improving health outcomes and lowering costs. To better address these social factors, the Centers for Medicare and Medicaid Services (CMS) updated its Medicaid managed care rule in early 2016.

To explore the impact of several provisions of the new regulation that influence states’ ability to address social determinants of health through managed care.

Several provisions in the new Medicaid managed care rule signal CMS’s intent to increase access to high-value nonmedical interventions. For instance, the regulation financially incentivizes health plans to address these needs by allowing certain nonclinical services to be included as covered services when calculating the capitated rate and medical loss ratios. In addition, the regulation encourages states to improve care coordination, adopt alternative payment models, and provide long-term services and supports in the home and community for beneficiaries with functional limitations.