The expansion of Medicaid in California resulted in dramatic increases to Medi-Cal's membership. A significant portion of these newly eligible beneficiaries are frequent users of services, low-income, previously uninsured, and have complex needs–including nonmedical needs. These nonmedical needs significantly impact health outcomes. Research has repeatedly demonstrated that social determinants of health play a larger role in determining health outcomes than health care access and services.
To respond to the adverse effects of social determinants of health that some members experience, Medicaid managed care plans (MCPs) in California have invested in strategies that address individual social needs and/or improve community conditions (referred to in this report as “social determinants–focused investments”). The current Medi-Cal rate-setting process does not have a mechanism to reflect these types of investments – a central barrier to their sustainability. One promising approach to encourage social determinants–focused investments is for the state to implement a rate adjustment that would incentivize investments that could improve members’ health and reduce health care utilization and costs but are not traditionally considered Medicaid benefits.
JSI interviewed MCP leaders across the state to understand their opinions on the concept and design of a rate-adjustment approach to support social determinants–focused investments were the state to pursue this strategy. This report summarizes the insights that leaders shared during these conversations.
This report was made possible with support from the California Health Care Foundation. JSI, 2019.
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