03/21/2014 04:09 pm ET Updated May 21, 2014

When Health Care Outcomes Are Determined Outside of Health Care

Five percent of Americans account for 50 percent of all health care spending. While this astounding statistic spans the entire population, my firsthand experience and discussions with colleagues at other health care systems suggests that the trend holds true at a more micro level too. Whether in a city, region or state, a small number of people are likely to account for a large proportion of health care. When it comes to improving the system, focusing on this 5 percent is a good place to start.

The presence of some individuals in the top 5 percent is unfortunately expected. They are afflicted with complex diseases that require intensive longitudinal treatments (i.e., progressive cancers) or perhaps they suffered an acute trauma that demands highly concentrated care. Given their circumstances, aggressive medical care is often the best option. Others are approaching the end-of-life, where America spends over 25 percent of all health care dollars. Many question whether or not our high spending on end-of-life care is reasonable. The increasing prevalence of comprehensive advance care planning programs and honest conversations about death and dying should help to ensure that aggressive end-of-life care is only delivered when both appropriate and desired by the patient.

Yet there is a another group of people within this 5 percent that shows much less disease burden and lacks a clear medical explanation for their extreme utilization. What tends to separate these individuals from other people with similar medical profiles -- but who do not use the system nearly as much -- is the presence of socioeconomic challenges (or unfavorable "social determinants of health" in public health speak). It is within this subpopulation that there lies a tremendous opportunity to decrease utilization and subsequent health care costs. But doing so is proving very challenging for a system that is neither accustomed nor equipped to manage many of the underlying issues in the lives of these patients.


American health care is very good at pulling drowning people out of the river, but has done little to address why so many people fall in. This is not surprising given:

  • A history of "fee-for-service" payment provides no financial incentive for providers to keep people out of the system. If anything, it discourages health promotion and rewards for sicker patients (i.e., payment is based on volume not value, and the more aggressive the intervention, the higher paying it tends to be).

When these factors are taken together, it becomes easy to see why our health care system waits for disease to rear its ugly head, and only then attempts to intervene. Unfortunately, the results of this approach have lead to unsustainable health care costs and outcomes that do not reflect spending. Shifting strategy to focus further "upstream" (i.e., helping to keep people from falling into the river to begin with) is a golden area at the intersection of reducing costs and improving quality. Deep in the trenches of medical care is both one of the most expensive and least desirable places for someone to be. And though our health care system will not change overnight, there is reason to believe we are beginning to shift course.

Most notably, key elements in the Affordable Care Act ("Obamacare") encourage a new approach by starting to adjust financial incentives to reimburse based on outcomes, not volume of care. The industry is responding as evidenced by the consolidation of different providers to deliver more coordinated care (i.e., Accountable Care Organizations) as well as the sprouting up of care-management programs that work with patients who have chronic disease before an acute crisis strikes. While more coordinated and proactive management of medical problems is a good start, it only represents the tip of the iceberg.

So many variables impact health care outcomes that lie far outside of what a traditional health care system does such as: housing, transportation, financial distress and domestic violence. It is very hard for someone to manage a health care problem if they are worried about paying the mortgage, putting food on the table, or their general safety. Traditionally, these issues fall under the realm of social services, an area the United States doesn't invest much in relative to its peers. Fascinating research by Elizabeth Bradley and Lauren Taylor in their recently published book, The Health Care Paradox, shows that when health care and social services spending are combined (including both public and private sector organizations), the United States ranks 13 in spending amongst developed countries. In this more holistic light, American health care outcomes are much more in line with spending.

Outcomes-based reimbursement creates a dilemma for health care providers when so many of their sickest patients will never get better inside the health care system until they get better outside of it. This undoubtedly raises questions about the scope and boundaries of health care. Although there is no clear line marking where health care ends and social services begin, there are actions health care systems can consider that carry the potential to pay huge dividends for their patients, communities and bottom lines.

  • Implement systematic approaches to identify patients with socioeconomic issues so that appropriate outreach can be targeted at them.
  • Invest in building extensive social work programs and an organizational culture that understands and values the importance of non-clinical variables in impacting health care outcomes.
  • Consider programs that include home-visits to vulnerable patients -- early pilot projects have demonstrated huge benefits of seeing these patients in their home setting.
  • Forge partnerships and coordinate holistic "care" with social service organizations.
  • Work with other health care systems to bolster the social service offerings in the community (these are common resources, the benefits of which are shared across many stakeholders).
  • Equip providers to evaluate and treat disease in the context of a person's life, which means assembling care teams that work well beyond a 10- to 15-minute visit.


It's time to start thinking about innovation in health care not just as some new fancy machine or surgical technique, but also as how we identify, approach and work with vulnerable people so there is less need to treat them as acute patients.