A new study indicates social determinants of health (SDoH) are associated with an increase in Medicare per beneficiary spending in certain geographic variations.
SDoH play a key role in geographic variation in Medicare per beneficiary spending in the U.S., according to a study published by JAMA Network Open.
The findings indicate that Medicare spending increased in the geographic areas where people struggled with more SDoH. Addressing SDoH could reduce health care spending as well as improve quality of care, according to researchers from the division of health policy and economics, department of population health sciences, Weill Cornell Medical College.
For the study, which examined 3,038 counties across the U.S., researchers analyzed the Medicare spending and patient demographics of Medicare fee-for-service patients from the Centers for Medicare & Medicaid Services (CMS) geographic variation public use file for 2017, as well as SDoH data from the American Community Survey and the Robert Wood Johnson Foundation County Health Rankings.
The study assessed 13 SDoH measures. Five of the measures were related to socioeconomic SDoH, including median household income, percentage of residents uninsured, unemployment rate, percentage of residents without a high school degree, and food environment index. Four additional measures examined race/ethnicity using the percentages of residents who are Hispanic, non-Hispanic Black, non-Hispanic and of another race category, and not a U.S. citizen. One measure evaluated social relationships by examining the number of membership associations per 1000 population. The final three measures fell into residential and community context, including the percentages of households with severe housing problems, the percentage of residents with access to exercise opportunities, and the percentage of housing units in rural areas.
The study also measured county-level clinical risk based on CMS hierarchical condition category (HCC) scores as well as counties’ supply of health care resources, such as physicians and specialists, hospital beds, and ambulatory care centers.
Researchers found SDoH to impact Medicare spending in multiple ways. Indirectly, SDoH are commonly associated with chronic illnesses such as diabetes, heart conditions, and cancers and, therefore, increased spending. However, SDoH such as socioeconomic disadvantage can directly impact spending as it’s a direct barrier to patients’ ability to access or afford care, causing less effective treatment and higher cost.
Spending for the 33,495,776 Medicare FFS beneficiaries included in the study ranged from $4,447 to $16,570. The counties with the highest spending, which researchers labeled as quintile five counties, had higher CMS-HCC scores, fewer primary care physicians, lower household income, higher uninsured and unemployment rates, and a lower food environment index. Quintile five counties also had more residents who identified as part of a racial/ethnic minority group, were not U.S. citizens, had fewer membership associations, and had more severe housing problems.
According to the study, SDoH were directly associated with 5.8 percent of geographic variation in Medicare spending between the highest and lowest spending counties. When including the indirect associations between SDoH and Medicare spending through clinical risk and supply of health care resources, the number increased to 37.7 percent.
“Our results suggest that failure to address SDoH may indicate missed opportunities for reducing geographic variation in spending and for reducing health disparities in regions with disadvantaged social conditions,” wrote study authors, calling for greater investments in areas such as job training, healthy food access, and neighborhood exercise infrastructure to improve SDoH and contribute to downstream reduction of health care spending.