Addressing Social Determinants of Health via Medicaid Managed Care Contracts and Section 1115 Demonstrations

Publication Year: 2018
Patient Need Addressed: Care Coordination/Management, Patient satisfaction/engagement
Population Focus: Medicaid beneficiaries
Type of Literature: Grey

The conditions in which we are born, live, learn, work, and play affect health in myriad ways—in some cases more than the medical care we receive. State Medicaid agencies have increasingly looked at ways to address these “social determinants of health” (SDOH) in an effort to provide more efficient care and improve health outcomes. They have begun to use a variety of approaches to support such work, thinking strategically about how best to align SDOH-related activities with other reforms, such as value-based purchasing, care transformation, and the development of larger partnerships focused on population health. In this report, supported by the Association for Community Affiliated Plans (ACAP), the Center for Health Care Strategies (CHCS) examines Medicaid managed care contracts or requests for proposals (RFPs) in 40 states, in addition to 25 approved § 1115 demonstrations. CHCS compiled incentives and requirements relating to SDOH, identified common themes in the states’ approaches, and developed recommendations for federal policymakers, including the Centers for Medicare & Medicaid Services (CMS).

Insights Results

Overview of article

  • For this project, Center for Health Care Strategies (CHCS) examined how, through managed care contracts and 1115 demonstrations, states required or incentivized different entities—regional partnerships, hospitals, provider organizations, managed care organizations (MCOs), and accountable care organizations (ACOs)—to address social determinants of health (SDOH)

Methods of article

  • CHCS used 2 lenses to guide their review of SDOH in managed care contracts (MCCs): 1) Systems and partnerships (i.e., infrastructure and processes related to SDOH needs); and 2) Authority and funding (i.e., existing law that address SDOH)
  • CHCS reviewed managed care contracts in all 39 states with risk-based managed care programs, in addition to one state about to implement a managed care program in November 2019: North Carolina
  • In addition, CHCS reviewed a subset of approved 1115 demonstrations: 1115 demonstrations related to delivery system reform, Additional 1115 demonstrations that implemented a managed care model, 1115 demonstrations that implemented incentives for healthy behavior and 1115 demonstrations that implemented community engagement and work requirements


  • 4 common themes emerged from the review of 1115 demonstrations: 1) There is a focus on enhancing care coordination and community partnerships to address SDOH; 2) Payment incentives are increasingly deployed to address SDOH; 3) Healthy behavior incentives are not typically linked to SDOH; and 4) 2 states allow health plans to help members meet eligibility requirements related to work and community engagement
  • 39, soon to be 40, states provide services to Medicaid beneficiaries through risk-based managed care plans. 35 states discuss SDOH or SDOH-related activities in the context of care coordination and management requirements, primarily using either screening or linkages/coordination
  • In the review of managed care contracts, several themes emerged: 1) Variation in state approaches; 2) Coordination with other initiatives; 3) Care coordination terms; 4) Quality assessment and performance improvement; 5) Member engagement, health equity, and other approaches; 6) Additional services; 7) Contract provisions related to payment; and 7) Community investment
  • In review of the 1115 demonstrations, 7 key findings were identified: 1) 7 delivery system reform demonstrations build multi-disciplinary partnerships that include community-based organizations or social service agencies; 2) 10 delivery system reform demonstrations advance projects or programs that encourage screening for social needs and linkages to community resources that address SDOH; 3) 2 § 1115 demonstrations specifically fund Medicaid ACOs’ capacity to address SDOH; 4) 3 § 1115 demonstrations created new types of services related to SDOH and linked those services to value based payment initiatives; 5) 2 delivery system reform incentive payment (DSRIP) demonstrations referred to SDOH in the context of the state’s overall approach to sustain delivery system reform investments through managed care and value-based payment (VBP); 6) Demonstrations that refer to healthy behavior incentives largely do not discuss the ways in which MCOs or the state can address the SDOH that influence health behaviors; and 7) Demonstrations with work and community engagement requirements included standard requirements on connecting beneficiaries to community resources

Key takeaways/implications

  • States have not taken full advantage of MCC’s flexibility. 3 themes emerged in the review of SDOH in MCCs: 1) Growing focus on SDOH in state MCCs; 2) Limited provision by most states on how MCOs can use flexibilities under federal law to provide services that address SDOH; and 3) Lack of commonplace of payment incentives linked to SDOH
  • Policy recommendations to address SDOH for systems and partners include: 1) Make it easier for vulnerable populations to access needed health services and care coordination; and 2) Enhance agency collaboration at the federal level. Policy recommendations to address SDOH related to authority and funding include: 1) Provide additional guidance on how states can encourage and incent MCOs invest in SDOH; 2) Approve 1115 demonstrations that test strategies to address SDOH; and 3) Support outcomes based payment for SDOH interventions