Equity in Value Based Care: Aligning Payments with Patient Needs

Health Equity and Social Determinants of Health

Health equity allows every individual to access and receive the same quality care regardless of structural or social determinants. The World Health Organization defines health equity as being "achieved when everyone can attain their full potential for health and well-being."

Social Determinants of Health (SDOH) are major factors influencing access to care and health outcomes. These include socioeconomic status, education level, and environmental conditions that shape health risks and quality of life. For example, living in a low-income area may limit access to healthcare services and fresh foods. A lack of public transportation creates barriers to care, while the absence of bike lanes or sidewalks reduces opportunities for physical activity. Lower socioeconomic status can also impact health insurance coverage and the ability to afford healthier options.

So, what does provider payment have to do with this? When reimbursement models fail to account for these barriers, patients not only suffer from inequitable care, but providers serving vulnerable populations may be penalized despite facing greater challenges. Integrating equity metrics and risk adjustment into payment systems ensures that providers are resourced to meet patients where they are, reducing disparities and improving health outcomes.

Equity Metrics

Integrating SDOH into equity metrics provides a robust foundation for assessing patient needs and advancing health equity. It is essential to comprehend factors such as race, ethnicity, preferred language, geographic location (zip code, census tract), and other social risk factors to accurately assess the needs of patients.

Equity metrics can inform resource allocation in areas such as interpreter services, transportation support, mobile clinic deployment, patient engagement strategies (e.g., text reminders), and literacy-sensitive educational materials.

Addressing these areas enables the promotion of equity and facilitates the analysis of its impact on the patient population. It is crucial to consider factors such as health literacy, sensory impairments, language barriers, and limited digital access (e.g., lack of devices or WiFi) to ensure inclusivity and effectiveness. For example, patients without WiFi or devices may benefit from mobile clinics that bring care directly to the community.

Embedding equity metrics into reimbursement models ensures providers are resourced to meet diverse patient needs, ultimately reducing disparities and improving outcomes.

Integrating Equity Metrics in Value-Based Payment (VBP) Systems

There is a push for equity metrics to be included in payment models to ensure fair reimbursement and improved access for vulnerable populations. Accountable Care Organizations (ACOs) are one avenue for pushing value-based care models. ACOs are networks of providers that work together to ensure coordinated high-quality care. Below are a few ways equity is currently being implemented in VBP:

• ACO Realizing Equity, Access, and Community Health (REACH) Model:

  • This payment model enables providers to collaborate and coordinate care plans for patients with complex chronic conditions who have multiple providers, while prioritizing underserved communities by embedding equity requirements. With the ACO REACH model shifting to have a greater equity focus, the number of safety-net providers has increased, which improved access for uninsured patients, Medicaid beneficiaries, and other vulnerable populations. Previously, safety-net providers were not included in many models because of the lack of eligibility. Now there are many models that incorporate safety-net providers and federally qualified health centers (FQHCs) to ensure the access of high-quality care and improved outcomes.

  
  

• Health Affairs highlights several additional models include ACO Primary Care Flex, the Transforming Episode Accountability Model (TEAM), and the Medicare Advantage Value Based Insurance Design (MA VBID). Each model represents a distinct approach to incorporating equity into reimbursement — from primary care flexibility to episode-based accountability and benefit design — collectively advancing the integration of equity into value-based care.

Challenges and Barriers

Advancing equity in value-based care presents significant challenges, particularly for safety net providers. These organizations often face disproportionate payment penalties compared to providers serving higher-income, commercially insured populations, due to patient populations with higher rates of financial hardship, limited access to medications, and uninsurance.

Implementing robust risk adjustment methodologies is essential to ensure fair compensation and protect safety net providers from undue financial penalties. Such adjustments encourage broader participation of safety net providers in ACOs, expanding access and improving outcomes for vulnerable patient populations.

Conclusion

Equity must be at the center of value-based care if we are to truly transform healthcare delivery. By integrating Social Determinants of Health into equity metrics, expanding participation of safety net providers through models like ACO REACH, and implementing robust risk adjustment methodologies, we can ensure that reimbursement systems reflect the realities of vulnerable populations. These steps not only protect providers from undue financial penalties but also encourage broader participation in innovative care models. Ultimately, incorporating equity into payment structures is more than a technical adjustment—it is a commitment to fairness, access, and improved outcomes.