Care That’s Fair – Reducing racial disparities in health care

Aug. 17, 2020 / By Matt Gallivan

During this period of renewed reflection concerning inequality in America, we must admit that our health care system continues to disproportionately fail Black Americans.

If you are Black, you are four times more likely to be hospitalized with severe COVID-19 compared to white Americans.[1] If you are a Black woman in America, you are nearly four times more likely to die during pregnancy.[2] Black Americans die at younger ages from diabetes, high-blood pressure, and stroke.[3]

One factor is that Black Americans receive poorer quality of care compared to white Americans. They are less likely “to be given appropriate cardiac care, to receive kidney dialysis or transplants, and to receive the best treatments for stroke, cancer, or AIDS.”[4]

Poor health outcomes are also tied to non-health factors, such as unstable housing, job instability, food insecurity, unsafe environments and poor education.[5] Black Americans experience these non-health factors at disproportionate rates.[6]

Health inequality is a systemic problem that has resulted in Black Americans living shorter lives than white Americans.[7] If life is a game of poker, white Americans on average are dealt a pair of jacks, while Black Americans are dealt a two and a seven.

While inequality is a much bigger issue and affects more than health care, we in the health care community can turn words into action by finally advancing reforms that reduce disparities. For those of us working in health care policy and research, this moment demands new ideas—here’s mine: a new Medicaid model that I’m calling Care That’s Fair (CTF), which will reduce racial disparities in health care by:

  1. Tackling the non-health factors of health;
  2. Bettering health care outcomes; and
  3. Enforcing equity for similar patients of different races

Many states have restructured their Medicaid programs by paying a monthly amount to insurance companies to manage the total health of an individual. However, insurance companies are paid more than $250 billion every year to only focus on one element of health—the use of health care services when someone is sick.[8]

This misaligned approach is like giving your child a list of chores to do with the promise of an ice cream reward, but then giving them the ice cream after they have only done one chore from the list. If the job is to do all the chores, but you reward them for doing less, of course they will only do the minimum. It’s the same thing for insurance companies – with so many competing priorities, why would they focus on accomplishing the full job, when state Medicaid Departments pay for completion of only part of the job.

We should demand more value and a holistic approach to managing an individual’s health. States should combine Medicaid spending with spending on other safety-net programs (such as housing and nutrition assistance). This would go as a lump sum to what I call a Care That’s Fair Collaborative (CTFC), a partnership between an insurance company and social service organizations, which would be responsible for managing services that impact the total health of a person.

The key to this approach working is robust accountability, which would require States to adopt outcome metrics that measure the quality of health care services and the success of programs addressing non-health factors of health. Measures would be broken out by race to make certain CTFCs are ensuring equal treatment for similar patients of different races. In the Care That’s Fair model, CTFCs that meet state set targets for improved health and non-health outcomes for individuals of all races would receive a financial bonus. Those that don’t or those that fail to ensure equity would face significant financial penalties. Robust financial incentives tied to equity, non-health and health outcomes will lead to greater total health and reduced disparities for Black Americans and other people of color.

The time has come to advance disruptive reforms to address inequality in our health care system. Some states have pulled together Medicaid and Public Health Department programs to address the needs of historically marginalized populations during the COVID-19 pandemic, but I hope this is just the start, not a one-time effort. Reimagining Medicaid programs through an approach like Care That’s Fair would remove systemic barriers to better total health for Black Americans. The question is do we have the courage as health care leaders to seize this opportunity to break the status-quo?

Matt Gallivan is the Director of State and Federal Regulatory Affairs for 3M Health Information Systems.