Medicaid managed care organizations can leverage financial bonds to help increase funds for social determinants of health interventions and avoid underinvesting, according to research published in Health Affairs.
Social determinants of health, including food insecurity, transportation barriers, and housing instability, can impact health equity and lead to avoidable health outcomes and spending. Interventions to address these factors typically require significant upfront funding, with benefits occurring down the line in the form of cost savings.
Medicaid managed care organizations experience enrollment and eligibility changes, which may dissuade them from investing in interventions as they are not guaranteed a return on investment. An organization investing in something and not reaping the full return as cost savings is known as the wrong pocket problem.