Will community-giving programs reduce burden on Medicaid?
Will community-giving programs reduce burden on Medicaid?
Many nonprofit health plans and health systems serving the publicly insured are now using formal giving programs to reinvest millions of dollars back to the communities they serve. The funds are being used to make health improvements such as expanding coverage to vulnerable groups, which is good news for Medicaid.
Marriotsville, MD-based Bon Secours Health System invested $1.6 million in Calvert Foundation, a nonprofit that provides low-interest loans in underserved communities including Richmond, VA; Baltimore; and New York City. The impact on state Medicaid plans likely would be twofold, according to Edward Gerardo, the health system's director of community and social investments.
First, community investment programs will create or undergird an economy in local neighborhoods that can reduce the number of individuals and families participating in Medicaid. "If our funds are loaned for entrepreneurial efforts, job training, job creation, affordable housing construction, and building of charter schools, I'm confident that these activities will provide income and reduce the likelihood that Medicaid rolls will increase," Mr. Gerardo says.
Secondly, the funds likely will affect the social determinants of health, including housing, education, and job skills. "These improved conditions lower or reduce unnecessary health resource utilization among people, including Medicaid recipients, so that Medicaid expenditures are lowered," says Mr. Gerardo.
Impact is great
According to the May 2009 report "Community Giving Programs of Medicaid-focused Health Plans" from the Association for Community Affiliated Plans (ACAP) in Washington, DC, these initiatives are having significant successes in improving care of vulnerable populations.
The report says community giving programs have been able to supplement other funding sources to support important initiatives. These include expanding coverage, improving access through development of the service infrastructure, supporting prevention, and other community health programs, and promoting quality improvement.
"These activities will have a positive return on the health status of the community," says Deborah Kilstein, ACAP's director of quality management and operational support.
For example, Tarrytown, NY-based Hudson Health Plan developed The Hudson Center for Health Equity & Quality (Hcheq) to promote quality improvement and use of health information technology. An application was developed to switch from a paper-based system to electronic enrollment. "We are rolling it out and trying to market it to health plans," reports Georganne Chapin, CEO of Hudson Health Plan. "Even though the initial ROI figures are for health plans-since Medicaid pays the premiums-if the health plan's costs go down, the state's costs go down, too. We know there are corresponding savings on the state side."
Hcheq also has developed innovative pay-for-performance programs, including those that reward improvement as opposed to a particular level of performance. "Our health plan spends a lot of time trying to help providers with best practices, both clinical and administrative," says Ms. Chapin. "This will help Medicaid to provide cost-effective and high-quality care."
In these times of high economic stress, there is a trend for foundations to concentrate on basic needs funding of emergency services, food, clothing, housing, and health care. "That could potentially be helpful to consumers in the Medicaid demographic," says Cathy Ponitz, executive director of Dayton, OH-based CareSource Foundation. "We've seen that pattern over and over throughout the decades."
Contact Ms. Chapin at [email protected], Mr. Gerardo at (410) 442-3361 or [email protected], Ms. Kilstein at (202) 341-4101 or [email protected], and Ms. Ponitz at (937) 531-2808 or [email protected].
Many nonprofit health plans and health systems serving the publicly insured are now using formal giving programs to reinvest millions of dollars back to the communities they serve. The funds are being used to make health improvements such as expanding coverage to vulnerable groups, which is good news for Medicaid.Subscribe Now for Access
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