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Transforming Care: Nonprofit Hospitals Work to Strengthen Neighboring Communities

Transforming Care: Reporting on Health System Improvement 0a4d3ad4-2bc7-4c5f-9605-e945832e7d31

In Focus: Hospitals Invest in Building Stronger, Healthier Communities

Patricia Ni'ma-Mohammed, M.S.W., of Trenton Health Team, speaks with a community member about services. Photo Credit: Matt Rainey for The Trenton Health Team

Patricia Ni'ma-Mohammed, M.S.W., of Trenton Health Team, speaks with a community member about services. Photo Credit: Matt Rainey for The Trenton Health Team

Several large health systems are using community benefit dollars and money from community investment funds to reach beyond the walls of their institutions and address the upstream determinants of health—including access to safe housing, healthy food, and employment.

To retain their tax-exempt status, private nonprofit hospitals—which make up roughly 60 percent of U.S. hospitals—have a legal obligation to give back to their communities.1  Most do so by providing free care to uninsured patients, making up for Medicaid shortfalls, offering medical training, or sponsoring disease awareness campaigns and health fairs—all of which can be declared as “community benefit” on tax returns. A small minority are going beyond this, devoting revenues and portions of their investment portfolios in innovative ways intended to address the upstream determinants of health, including lack of access to healthy food and safe housing. The hospitals that have ventured into this area do so in part out of recognition that health is the product of much more than health care, with factors like poverty and education playing an outsize role.2  Most if not all are also mission-driven organizations or integrated delivery systems that have assumed financial risk for caring for large populations of patients.

An Affordable Care Act provision requiring nonprofit hospitals to perform and publish triennial community health needs assessments may encourage others to follow their lead as the assessments shed light on what communities really need (see sidebar for more on community health needs assessments). These reports, sometimes conducted in partnership with public health agencies and organizations such as the United Way, highlight health inequities in so-called “cold spots”—the city blocks or neighborhoods that lack the clean environments, safe streets, good schools, vibrant economies, and other assets that support good health.3  They can also put firm numbers around an area’s most pressing health problems, such as high rates of obesity, suicide, and substance abuse.4


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Graphic reprinted with permission from the CDC.


This issue of Transforming Care looks at how some nonprofit hospitals are leveraging their charitable dollars, community investment funds, and purchasing decisions to promote healthier behaviors and stronger communities, often in partnership with public health departments, schools, faith-based organizations, nonprofits, businesses, local governments, and others (see sidebar for examples of how hospitals have leveraged their purchasing power).



Focusing on Hunger: ProMedica

ProMedica, a health system with 12 hospitals in Ohio and Michigan, allocates $100 million a year to community benefit spending and other charitable activities. One aim is reducing food insecurity in its hometown of Toledo, Ohio, where high poverty rates (as high as 40% in some neighborhoods) mean some residents struggle to feed themselves and their families, or subsist on cheap, unhealthy food.5


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Staff dietitians at ProMedica’s food pharmacy offer patients counseling about appropriate food choices. Photo credit: ProMedica

After the recent recession brought this issue into starker focus, ProMedica began screening all patients admitted to its hospitals for signs of food insecurity. Those who screened positive (about 4% of patients screened) were given a day’s worth of shelf stable food—much of it reclaimed from food banks—and referred to sources of nutritional support. ProMedica later integrated a two-question screen into its electronic health record system for outpatients as well (see box). “It’s helped to frame it for patients and doctors as a health issue, not a poverty issue, and the results revealed that you can’t recognize food insecurity by looking at somebody,” says Stephanie Cihon, associate vice president for community and government relations. “Many of our patients are the working poor. They have jobs, but aren’t making enough to pay bills in their entirety and we’re seeing food is something that gets sacrificed.”

 ProMedica’s Food Insecurity Screening Tool

Patients are considered to be at risk for food insecurity if they answer that either or both of the following two statements are “often true” or “sometimes true”:

  • Within the past 12 months we worried whether our food would run out before we got money to buy more.
  • Within the past 12 months the food we bought just didn’t last and we didn’t have money to get more.

To address this, ProMedica opened two “food pharmacies” in 2015 and 2016, where patients deemed to be food insecure are now referred by their primary care physicians. Staff dietitians offer patients counseling about appropriate food choices, taking into account their social circumstances (for example, whether they have a refrigerator and a working stove) and their medical conditions. Patients are then free to choose their own items at no cost—most of the food is donated from a local food bank—and can return once every 30 days for six months before they need a new referral. “This is food as medicine,” Cihon says.

Also in late 2015, ProMedica opened a full-service grocery store in downtown Toledo, in an area that had been deemed a food desert by the U.S. Department of Agriculture after a large grocer moved out. Owned and operated by the health system, the 5,500-square-foot store is part of the health system’s Ebeid Institute for Population Health, which also offers nutrition and cooking classes as well as jobs for local residents. By offering the classes, ProMedica hopes to achieve better results than stores established in food deserts in Philadelphia and New York, where researchers have found poor residents tended toward less healthy food, either because it was cheaper or it was what they preferred.6


Listening to Residents: Bon Secours

In contrast to ProMedica’s narrow focus, Bon Secours, a Catholic health system based in Marriottsville, Md., has taken a multifaceted approach to address social problems. “If a community has high unemployment, low graduation, and high infant mortality rates, you have to weave those points together or you will have limited success in transforming health status,” says Ed Gerardo, director of community commitment and social investments.


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Staff from Bon Secours and community volunteers build a greenhouse to grow fruits and vegetables on a vacant lot in West Baltimore. Participants in its workforce training program will tend the garden and manage a produce stand. Photo credit: Bon Secours

The health system, which operates 20 hospitals in six states and participates in the Medicare Shared Savings Program, has made reducing poverty and its effects a central focus, beginning by paying its lower-wage workers roughly 30 percent more than the federal minimum wage, promoting education and financial counseling, and developing career tracks designed to move employees into higher-skilled and higher-paying jobs.

Its efforts to strengthen the poor communities surrounding some of its hospitals have focused on improving housing, access to jobs, and developing loan programs that help residents avoid predatory lenders. In Southwest Baltimore, an area with extensive social problems (as depicted in the TV show The Wire), the health system has built more than 800 units of affordable housing and converted another 640 vacant lots into green spaces.7  Other efforts include youth training and employment programs, a family support center, and financial literacy programs for residents. This work has been done in partnership with local businesses, churches, neighborhood associations, and residents. “We take a catalytic approach—we seek to be an enzyme to get people talking and work from there,” Gerardo says.

Gerardo says the system learned early on it was best to let communities take the lead in setting priorities. When staff at Bon Secours Baltimore Hospital first wanted to do something about the high crime rates and pervasive drug problem in its neighborhood, “we thought the answer would be police patrolling, more arrests,” he says. “But when we set up a few community conversations, people said ‘We don’t like the crime and drugs, but if you really want to do something get rid of the trash piles. We’re tired of rats climbing into our homes and biting our children.’” This led to cleanup initiatives that fostered relationships and laid the grounds for future work, a model the system has followed in other communities.

Targeting Housing: Dignity Health

Dignity Health, a San Francisco, Calif.–based health system that operates 39 hospitals and hundreds of care centers in 21 states, has used its community investment program as well as grant dollars to address social determinants of health. Like Bon Secours, it has made housing development one of its key focus areas. For instance, the system has donated unused buildings and vacant land for the development of affordable housing and provided low- and no-interest loans to nonprofits developing housing for families, seniors, and homeless individuals, in some cases using a supportive housing model that couples housing with medical and social services.

Since 1990, Dignity Health has given a total of $62 million in grants and made $166 million in loans and equity investments in nonprofit organizations that provide access to food, housing, health, and education in low-income and minority communities. In 2015, it established a “social innovation partnership grant program” that offers grants (ranging from $100,000 to $250,000) to organizations to pursue or promote new models of care and other strategies for improving access, care coordination, and health outcomes for disadvantaged populations. The program has been used to convene housing developers, social service agencies, philanthropists, and government agencies that want to collaborate in building supportive housing models.

Direct Support and Policy Advocacy: Trinity Health

In November 2015, Trinity Health, a large Catholic health system based in Livonia, Mich., announced its $80 million Transforming Communities Initiative. The program will offer a combination of grants, low- or no-interest loans, and technical assistance to six community coalitions in which local Trinity Health hospitals are partners. The health system aims to leverage existing resources and serve as a long-term partner by offering capital and other support to promote efforts related to reducing teen smoking and obesity.


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Participants in the Faith in Prevention program—led by the Trenton Health Team, one of Trinity Health’s Transforming Communities grantees—learn about healthy nutrition and physical activity. Grants are given to faith-based organizations to help run the program. Photo Credit: Courtney Tilton for The Trenton Health Team

Each of the coalitions will receive technical assistance from community development financial institutions (CDFIs), which are private entities that offer affordable loans to local businesses, low-income housing developers, and others who may have trouble securing capital. The CDFIs will help fledgling nonprofits and new businesses “bridge the gap between community health and community development,” says Bechara Choucair, M.D., senior vice president of safety net and community health.

Each of the coalitions will also receive support from Change Lab Solutions and Tobacco Free Kids, groups that promote policy changes such as raising the legal age for cigarette purchases from 18 to 21 or taxing sugary drinks.


Community Benefit vs. Community Building Activities

When it comes to community investments, the activities taken by ProMedica, Bon Secours, Dignity Health, and Trinity Health are in many ways the exception, not the norm. Most nonprofit hospitals still focus the lion’s share of their charitable giving on covering the costs of caring for the uninsured and making up Medicaid shortfalls—practices that arguably benefit the health systems as much as their patients.8  “I’d argue a big hunk of community benefit spending may go to bad practice management. That is, it’s being used to cover losses that come from not managing Medicaid spending well,” says John Whittington, M.D., lead faculty for the Triple Aim at the Institute for Healthcare Improvement.

Community Health Needs Assessments

While some nonprofit hospitals have made a practice of assessing the health needs of their patients for years, a provision in the Affordable Care Act made this a required activity. Every three years starting in 2013, nonprofits have had to perform community health needs assessments—and publish their results (see Q&A with Kevin Barnett, Dr.P.H., M.C.P., who reviewed a subset of them). They also have to develop a strategy for addressing identified needs, though this does not need to be made public. Given the newness of these requirements, and many hospitals’ inexperience in thinking about public health, the results so far have been uneven. Jack Westfall, M.D., professor of family medicine at the University of Colorado School of Medicine, says many assessments are superficial, relying on consultants to conduct surveys that don’t really get at underlying determinants of health. “If you go into a poor or rural community they will tell you they need a doctor, and more options for health insurance,” he says. “But if you actually sit at people’s kitchen table and spend time talking with them, what you learn is they need transportation. It takes time and close contact to find out what the real barriers are.” Some nonprofits are partnering with public health departments or other hospitals in their cities to broaden their efforts; for example, in Chicago 20 hospitals working in collaboration with the Illinois Public Health Institute fielded an assessment that asked about housing, community safety, discrimination, barriers to accessing mental health care, public transit, access to food, and other issues.

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Patricia Ni'ma-Mohammed, M.S.W., of Trenton Health Team, speaks with a community member about services. Photo Credit: Matt Rainey for The Trenton Health Team

Still, Greg Paulson of Trenton Health Team, one of Trinity Health’s Transforming Communities Initiative grantee organizations, says that the process “doesn’t have to be overly engineered, overly structured, or resource intensive. You just have to go in with an interest in finding people where they are, asking the right questions, and listening to the answers.”

The way the Internal Revenue Service (IRS) distinguishes “community benefit” and “community building,” two categories of charitable activities that hospitals report to the IRS each year, also plays into allocation decisions. The IRS defines community benefit as financial assistance to cover the costs of care, participation in Medicaid and other means-tested public programs, community health improvement services such as improving access to services or enhancing public knowledge, subsidized health services, and research. By contrast, it defines community building as improvements to the physical environment, including housing; economic development activities; environmental improvements; leadership development and training for residents; coalition building; health improvement advocacy; and workforce development.

The IRS does not credit community building activities in the same way as it does community benefit work and the fact that it draws a distinction between the two gives hospitals pause. The American Hospital Association and others have been advocating for the IRS to clarify to hospitals that both categories of activities are legitimate undertakings—that in fact supporting things like stable housing or access to healthy food is supporting health—and that both will be considered by the agency when reviewing hospitals’ charitable activities. Hospitals are looking to make major investments in community revitalization but “want to be less at risk and to have greater clarity for reporting those investments,” says Maureen Mudron, deputy general counsel of the American Hospital Association.

Julie Trocchio, senior director of community benefit and continuing care at the Catholic Health Association of the United States, which provides guidance to hospitals on community benefit programming and reporting, says that while further clarification from the IRS can only help, existing guidance and instructions give hospitals more latitude that they may think. She says programs and activities--including those that fall in the community building category--can be reported to the IRS as community benefit as long as they are addressing a community health need and are provided to improve community health. “If that’s the case, it can be reported as community benefit—just so long as it’s not also reported as community building,” she says.

Investing for the Long Term

Another reason nonprofit hospitals may be reluctant to invest in community building is a concern about return on investment—in dollars or health outcomes. Denise Koo, M.D., advisor to the associate director for policy at the Centers for Disease Control and Prevention (CDC), says health system staff often ask the CDC for evidence of the financial impact of efforts to address social determinants. “They want examples to show their C-suite that people are saving per-patient costs or decreasing emergency department visits or decreasing admissions, especially if they are able to do it in the current fee-for-service environment. They want to be able to show it’s worth the risk,” she says. Hearing this concern from hospitals led the CDC to develop a community health improvement navigator, including tools for how to do the work and examples of interventions that have had some results, including financial impacts. And investigators with the National Institutes of Health–funded Centers for Population Health and Health Disparities describe some evidence of the health benefits of interventions focused on education, income enhancement, housing, among others here.

But even if evidence begins to emerge that better housing or safer streets improves people’s lives, it may still be difficult to tie those changes back to particular health outcomes. Jack Westfall, M.D., professor of family medicine at the University of Colorado School of Medicine, says that this may not be necessary since it has face validity that those who have a stable home, good nutrition, and safer neighborhoods are more likely to have good health. And it may take years, if not a generation, to demonstrate impact. “You have to be frank about the long-term nature of it. I’ve seen many people ‘sell’ activities to hospital boards, glossing over the time frame and a board scraps it within a year or two. You have to say we won’t be able to attribute returns to this in the next five years,” he says.

Gerardo agrees. One of the hardest things about this work is that “people often want results faster than they can be achieved,” he says. He feels fortunate that Bon Secours’ leaders see it as generational work. That may be the best way to position it, he says, by asking executives “what do you want to be remembered for?”

Leveraging Purchasing Power and Hiring

In addition to charitable investments and grants, large health systems like Dignity Health, Trinity Health, and Kaiser Permanente are leveraging their purchasing power to promote change. Such approaches may have more of a dramatic impact than community benefit or building dollars, given the amount of money involved.


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Hospitals are often among the largest employers in their communities and they can do a lot to help poor residents and neighborhoods through strategic hiring as well as purchasing practices. John Whittington, M.D., lead faculty for the Triple Aim at the Institute for Healthcare Improvement, notes that hospitals can procure supplies and hire contractors that are owned by and/or employ local residents, build in underserved communities, and pay higher wages to their own staff, among other activities.

When, for example, Cleveland’s University Hospitals system set out to build five new medical facilities in 2005, it set specific goals related to hiring businesses owned by minorities and women and directing its spending toward businesses based in the region. After five years, they met three of their four goals.. The system has now enshrined these practices in its purchasing policies.

Other systems, including Children’s Hospital of San Diego and University of Pittsburgh Medical Center, have for many years offered training and mentoring in the health professions to high school and college students in low-income communities—both to create more career opportunities for young people and to build the pipeline for health care workers.



1 In 2014 about 58 percent of the 4,926 U.S. community hospitals were private nonprofit entities. See American Hospital Association, Fast Facts on U.S. Hospitals,

2 See, for example, R. Chetty, M. Stepner, S. Abraham et al., “The Association Between Income and Life Expectancy in the United States, 2001–2014,” Journal of the American Medical Association, April 2016 315(16)1750–66; The Biology of Disadvantage: Socioeconomic Status and Health, Feb. 2010 issue of the Annals of the New York Academy of Sciences,; P. Braveman and L. Gottlieb, “The Social Determinants of Health: It’s Time to Consider the Causes of the Causes,” Public Health Reports, Jan./Feb. 2014 129(Suppl. 2):19–31,; and L. McGovern, G. Miller, and P. Hughes-Cromwick, “Health Policy Brief: The Relative Contribution of Multiple Determinants to Health Outcomes,” Health Affairs, Aug. 21, 2014, It’s also important to note that the ACA coverage expansions have reduced the number of uninsured patients in recent years, and thus lessened the demand for charity care in many states. This trend may also have some effect on hospitals’ community benefit allocations in some cases.

3 For more on “cold-spotting,” see J. Westfall, “Cold-Spotting: Linking Primary Care and Public Health to Create Communities of Solution,” Journal of the American Board of Family Medicine, May/June 2013 26(3):239–40. Westfall’s proposal builds on a framework laid out in a 1966 report by the National Commission on Community Health Services, Health Is a Community Affair, which was supported in part by The Commonwealth Fund.

4 Notably, hospitals do not have to disclose whether or how their community benefit spending conforms to what they find in the community health needs assessments. Nor do they have to report how their community benefit spending lines up with what they’ve said they’ll do to meet identified community needs in their implementation plans.

5 While living in poverty has many negative consequences, the effects are often exacerbated when many poor residents live in the same neighborhoods. In Toledo, 35 percent of the city’s 113,094 poor residents live in extremely poor neighborhood—where the poverty rate is 40 percent or greater. The metro area’s concentrated poverty rate was 24 percent during the recession. The 11 percentage point increase in concentrated poverty was one of the greatest of any major metro area since the recession. Toledo’s extremely impoverished neighborhoods were mostly clustered in the southeast during the recession. Since then, extreme poverty has spread southward across the Maumee River into East Toledo. See

6 M. Sanger-Katz, “Giving the Poor Easy Access to Healthy Food Doesn’t Mean They’ll Buy It,” New York Times, May 8, 2015, For more on ProMedica’s approach, see T. Hussein and M. Collins, “The Community Cure for Health Care,” Stanford Social Innovation Review, July 21, 2016,

7 D. Zuckerman, Hospitals Building Healthier Communities: Embracing the Anchor Mission, Democracy Collaborative, March 2013,

8 In 2011, financial assistance and Medicaid shortfalls accounted for 55 percent of all community benefit spending according to the IRS in its 2015 Report to Congress on private tax-exempt hospitals. Hospitals allocated the remainder across all other community benefit activities. IRS figures also show that in 2011, hospitals allocated slightly less than $2.7 billion out of nearly $62.5 billion in community benefit spending to community health improvement. See S. Rosenbaum and B. Choucair, “Expanding the Meaning of Community Health Improvement Under Tax-Exempt Hospital Policy,” Health Affairs Blog, Jan. 8, 2016, A study of hospitals’ community benefit expenditures during the 2009 tax year found that while hospitals on average spent about 7.5 percent of their operating revenues on community benefit activities, less than 0.5 percent were allocated to community health improvement activities for which there is no expectation of payment. See G. J. Young, C.-H. Chou, J. Alexander et al., “Provision of Community Benefits by Tax Exempt U.S. Hospitals,” New England Journal of Medicine, Apr. 18, 2013 386(16):1519–27.

Publication Details


Q&A with Kevin Barnett of the Public Health Institute

Kevin Barnett, Dr.P.H., M.C.P., a senior investigator with the Public Health Institute, an Oakland, Calif.–based nonprofit focused on strengthening the nation’s public health system, has spent the last two decades researching the ways nonprofit hospitals meet their charitable obligations. Part of this work includes looking at how hospitals spend their community benefit dollars. In 2013—the year nonprofit hospitals were first required to conduct and publish community health needs assessments (CHNAs)—he examined CHNAs and the resulting implementation plans for community health improvement developed by hospitals in 15 regions, looking at among other things how they defined their communities and engaged community stakeholders to identify problems and develop solutions. 


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Transforming Care: A first step in assessing community needs is identifying the community. Were you surprised by what you found about how hospitals went about this?

Barnett: In many ways yes. We selected a combination of large and small urban and rural areas that included census tracts where there was a high concentration of residents living in poverty and similarly high rates of high school non-completion. These metrics serve as effective proxies for higher concentrations of health disparities. We used a tool we developed in collaboration with the Community Commons to see to what extent hospitals included and described these areas in setting the geographic parameters for their CHNAs.  We found less than a quarter of the hospitals identified these geographic areas in their CHNAs. In a number of cases, the definitions of their communities were driven by service areas identified by their marketing departments, based on zip codes and census tracts. When we mapped them, some looked like “gerrymandered” districts that steered around areas of poverty. 

Transforming Care: Are IRS regulations part of the problem—don’t they suggest hospitals focus on their service areas rather than areas where there is unmet need or evidence of health disparities?

Barnett: That is part of the problem. On the one hand the IRS says hospitals should define their communities according to their service area but at the same time the agency indicates that hospitals should not define the geographic parameters of their CHNA in a way that would exclude communities where health disparities are concentrated. I think it’s a function of the parameters being drawn by people without population health expertise. Going forward, more clear and consistent guidance is needed from the IRS, given the market-based methods typically used by hospitals to define their service areas. 

Transforming Care: Did you find they were engaging community members in the needs assessment process, as called for by the Affordable Care Act?

Barnett: About three-quarters of hospitals in the study had engaged local stakeholders in the assessment process, but less than a quarter of those gathered input directly from people who experienced health disparities, as they defined them. They relied primarily on community-based organizations as their proxies. The hospitals in the regions we looked at rarely engaged community members and organizations in planning and implementing community benefit activities—which are supposed to be shaped and prioritized based on the findings of the assessments. The IRS regulations released in December 2015 may change some of that because they signal an expectation that hospitals will involve community stakeholders in priority setting. It’s a shot across the bow to hospitals that they need to think of themselves as public trusts rather than proprietary organizations, and part of that involves collaborating with a broader group of stakeholders to determine how they allocate their charitable resources.

Transforming Care: What did the hospitals commonly identify as priorities? 

Barnett: In the 2013 assessments, we found many were still very focused on clinical care, for example by increasing access to services including maternal and child health or improving the quality of care. Only 26 percent of the priorities they identified related to health behaviors such as diet and exercise and only 6 percent focused on social and economic factors that impede health such as education, employment, and community safety. At the time, none indicated a focus on improving the physical environment. This does not mean they were doing nothing in this arena, only that it was not addressed in their public reporting.  What we have learned from a number of hospitals is that continued ambiguity about the degree to which the IRS will give hospitals credit for contributions in the community building category is an impediment to investment in this arena.  

Transforming Care: Do you see this changing?

Barnett: Hospitals are now working on 2016 community health needs assessments and I expect to see more focus on community health and transformation. These efforts are likely to proceed at different paces, depending on whether hospitals are in states with Medicaid expansions or in markets where there is some level of shared risk emerging. To be economically viable, such hospitals eventually will have to go upstream. We are already seeing some hospitals and health systems moving a portion of their investment portfolios to supporting the development of housing, child care, and grocery stores as a way of improving health and quality of life. That said, I think it’s a hard shift for hospitals to go from focusing on what happens within their walls to looking at communities, especially those that may be outside of their primary service area. Hospital leaders have been consumed with implementing electronic medical record systems, addressing readmissions, and engaging in mergers and acquisitions. There’s a palpable sense of overload. 

Transforming Care: I imagine that many hospital boards might say this isn’t an appropriate role for hospitals—that they should concentrate on improving clinical care and ensuring it’s cost-effective rather than solving entrenched social problems. How do you respond to those folks?

Barnett: The truth is that many boards are not engaged on these issues in any detail; the CHNA and implementation strategy are typically presented for board members’ review and approval, not as an opportunity to provide input.  In my engagement of boards over the last decade plus, the most common response I get after sharing opportunities in the broader population health arena is “no one has ever shared this kind of information with me.”  This is driven by a compliance mentality, and a failure by leadership to see the opportunity not to position the hospital to do everything, but to strategically engage other sector stakeholders as partners.  As boards become increasingly informed about population health, I’ve found them to be ready to step up and support this important new direction. One of the things I am working on now is a partnership between Stakeholder Health (a coalition of health systems committed to addressing the social determinants of health) and the Governance Institute (an educational organization for hospital and health system boards), which brings board members and the senior leadership of hospitals together for a deep dive into content on population health and the intersection between community health and community development. 

Transforming Care: Do you think hospitals have the skills and staff they need to do this work?

Barnett: The short answer is no. Frontline staff, clinical and administrative leadership, and boards need more grounding in population health principles and strategies, and these need to be embedded not just into community benefit programming, but also into care design, data systems, and management and governance. Another thing they need are metrics to evaluate the impact of a more integrated, strategic approach to community benefit. The metrics they are using now focus primarily on process—the number of people they’ve served for instance. We may not be able to measure aggregate impact at the population health level for several years but we should be measuring ways in which hospitals, public health agencies, and other key community stakeholders are changing the way they do business. 

Transforming Care: What else might advance this work?

Barnett: I think we need to clarify expectations for defining communities to ensure hospitals are focusing on areas where health disparities are concentrated and we need to find ways of ensuring that opportunities for community input are meaningful. Right now hospitals are not required to post their implementation strategies on their sites, as is the case for their CHNAs. So it is difficult to build an environment of shared ownership where diverse stakeholders can participate in the design process. When implementation plans aren’t publicly disclosed, we encourage community stakeholders to ask hospitals these four questions: How are you defining your community? How are you engaging community stakeholders? How are you setting your priorities and with whom? And what is the geographic focus of your implementation strategies? Those four questions serve as an important starting point for improving practices in the field, not just by hospitals, but by all who share ownership for improving health and well-being in our communities.   

Interviewed by Sarah Klein and Martha Hostetter.

Publication Details


Newsletter Article


Publications of Note

Obama Weighs in on Health Reform
In a commentary penned for the Journal of the American Medical Association, President Barack Obama outlines the achievements of the Affordable Care Act as he sees them, including the law’s impact on health care access, affordability, and quality, as well as its promotion of new models of payment. To achieve greater benefit, he calls on policymakers to continue to implement delivery system reforms and health insurance marketplaces; increase financial assistance to marketplace enrollees; introduce a public plan option in areas lacking individual market competition; and take action to reduce prescription drug costs. B. Obama, “United States Health Care Reform: Progress to Date and Next Steps,” Journal of the American Medical Association, Aug. 2, 2016 316(5):525–32. 

Making a Business Case for Reducing Health Disparities
This commentary outlines several ways public and private payers can incentivize health care providers to address disparities in health outcomes. Among others, they include requiring providers to report clinical data stratified by factors such as race, ethnicity, and socioeconomic status; incorporating equity measures into incentive programs; providing technical and financial support to safety-net institutions; and funding demonstration projects that test new payment and delivery system reforms. Demonstrations, for instance, could help identify the most effective performance measures and risk-adjustment techniques and determine what types and magnitude of incentives are most powerful in influencing behavior for different types of care. M. H. Chin, “Creating the Business Case for Achieving Health Equity,” Journal of General Internal Medicine, July 2016 31(7):792–6. 

Documenting the Benefits of Addressing Social Determinants 
The authors of this article reviewed the evidence of the effectiveness of various interventions that address the social determinants of health—including programs focused on education and early childhood, housing, income, and employment—by documenting their positive impact on health outcomes, as well as crime rates, violence, and high-risk behaviors that carry significant financial and social costs. They say efforts to reduce disparities should focus on scaling up these evidence-based interventions at the regional, state, and national levels, since interventions focused on the health care sector alone are insufficient to address population-level health disparities. R. L. J. Thornton, C. M. Glover, C. W. Cene et al., “Evaluating Strategies for Reducing Health Disparities by Addressing the Social Determinants of Health,” Health Affairs, August 2016 35(8):1416–23.

Principles for Screening for Social Determinants of Health 
In this commentary, the authors outline some challenges associated with screening for food insecurity, lack of access to stable housing, and other social needs. If not handled sensitively and with systems in place to make referrals to community-based services, there is the potential for unintended harm, they say. To minimize the risk, they outline several principles for screening, which include engaging all of a practice’s patients, rather than targeting subgroups by apparent social status, and building on the strengths of patients and families as this practice correlates with positive long-term outcomes. A. Garg, R. Boynton-Jarrett, and P. H. Dworkin, “Avoiding the Unintended Consequences of Screening for Social Determinants of Health,” Journal of the American Medical Association, Aug. 23/30, 2016 316(8):813–4. 

Gaps in Research and Translation of Interventions to Reduce Disparities 
To guide the development of interventions and policies to reduce health disparities, the authors outline critical gaps in knowledge and call for more research into the relative benefits and interplay of interventions that target individuals; family, friends, and social supports; providers and organizations; and policy and community factors. The authors also profile promising approaches to reducing disparities related to cardiovascular disease and cancer that were developed by the Centers for Population Health and Health Disparities. They also call for greater engagement of patients in developing, testing, and disseminating interventions. T. S. Purnell, E. A. Calhoun, S. H. Golden et al., “Achieving Health Equity: Closing the Gaps in Health Care Disparities, Interventions, and Research,” Health Affairs, Aug. 2016 35(8):1410–5.

Analysis of Medicare Shared Savings Program Finds Modest Savings and Disparate Performance Among ACOs 
A study of the Medicare Shared Savings Program found declines in spending were greater among accountable care organizations (ACOs) that joined the program in 2012 compared with those that joined in 2013, suggesting early gains by more advanced ACOs may not be generalizable to less advanced ones or may be slower to develop. Per-beneficiary spending for Part A and B services in the 2012 cohort was estimated to be $144 less than for beneficiaries in the fee-for-service program, a savings of 1.4 percent, but was only $3 per beneficiary less in the 2013 cohort. Moreover, the estimated savings for the 2012 cohort were likely offset by bonus payments and the losses Medicare assumed for some ACOs under the one-sided risk model, resulting in no net savings for Medicare. ACOs in the program also demonstrated improved performance on some quality measures, but for others—including measures that track low-value care—performance was unchanged. The researchers also found independent primary care groups achieved greater savings than ACOs that included both hospitals and physicians, suggesting financial  integration between physicians and hospitals is not necessary for success. J. M. McWilliams, L. A. Hatfield, M. E. Chernew et al., “Early Performance of Accountable Care Organizations in Medicare,” New England Journal of Medicine, June 16, 2016 374(24):2357–66 

Commentary: CMS Should Jettison ACOs, Pursue Delivery Reforms That Take Advantage of Technology and Lower-Cost Models of Care
In this commentary in the Journal of the American Medical Association, the authors say the accountable care programs introduced by the Affordable Care Act—the Medicare Shared Savings Program and the Pioneer ACO program—have failed to achieve their goals. They point to three recent evaluations that found modest increases in spending or declines that were offset in some cases by incentive payments to participants. The authors also point out that the model has encouraged hospitals to acquire physician practices, allowing them to amass market power that has led to increased prices that health plans have sought to combat with high-deductible products and narrow networks. They urge the Centers for Medicare and Medicaid Services to abandon the ACO model and pursue strategies that encourage physicians to keep patients out of hospitals and away from costly facilities and tests. They also recommend the Center for Medicare and Medicaid Innovation invest in models that take advantage of telemedicine, diagnostic wearable devices, and lower-cost workers as a means of increasing efficiency. K. A. Schulman and B. D. Richman, “Reassessing ACOs and Health Care Reform,” Journal of the American Medical Association, Aug. 16, 2016 316(7):707–8. 

Vulnerable Patients Have Limited Access to ACOs
A study of physician participation in ACOs found that it varied widely across hospital referral regions—ranging from zero to 85 percent. The researchers also found participation rates were significantly lower in areas where a higher percentage of the population was black, living in poverty, uninsured, or disabled or had only a high school education, suggesting that such vulnerable populations’ access to ACOs is more limited than for other groups, which could exacerbate disparities in health care quality. They suggest several policy interventions, including offering physicians who serve vulnerable populations additional incentives to form an ACO or assistance with startup costs. L. C. Yasaitis, W. Pajerowski, D. Polsky et al., “Physicians’ Participation in ACOs Is Lower in Places with Vulnerable Populations Than in More Affluent Communities,” Health Affairs, Aug. 2016 35(8):1382–90.

High and Persistent Spending at the End of Life Associated with Chronic Conditions
Using Medicare claims data to characterize trajectories of health care spending among beneficiaries in their last year of life, researchers found:

  • nearly half (48.7%) had high persistent spending (high initial and steadily increasing spending);
  • 29.0 percent had moderate persistent spending (moderate initial spending, followed by a dip and then an increase toward end of life);
  • 10.2 percent had progressive spending (relatively low initially but increasing steeply over the year); and 
  • 12.1 percent had late rise spending (low spending up to four months before death, then increasing exponentially). 

They also found high spending over the full year before death was associated with having multiple chronic conditions but not any specific diseases, suggesting spending at the end of life is a marker of patterns set in motion long before death. M. A. Davis, B. J. Nallamothu, M. Banerjee et al., “Identification of Four Unique Spending Patterns Among Older Adults in the Last Year of Life Challenges Standard Assumptions,” Health Affairs, July 2016 35(7):1316–23.

Medical Home Model Lowers Spending for High-Need Patients
A study of Pennsylvania’s statewide patient-centered medical home initiative—which took place from 2008 to 2011—found it was associated with substantial cost savings for Medicaid patients with chronic medical conditions and comorbid psychiatric or substance abuse disorders. Researchers found spending was $4,145.28 less per patient per year for those participating in the Chronic Care Initiative, driven largely by reduced inpatient medical costs. The mean count of emergency department visits and psychiatric hospitalizations also declined (15.6% and 40.7%, respectively). They did not measure quality of care, and thus did not draw conclusions about the initiative’s overall cost-effectiveness. K. V. Rhodes, S. Basseyn, R. Gallop et al., “Pennsylvania’s Medical Home Initiative: Reductions in Healthcare Utilization and Cost Among Medicaid Patients with Medical and Psychiatric Comorbidities,” Journal of General Internal Medicine, published June 25, 2016. 

Integration of Primary and Behavioral Health Care Improves Quality, Lowers Utilization, Decreases Reimbursements 
A study of patients receiving primary care at Intermountain Healthcare clinics that integrated physical and behavioral health care services found that compared with traditional primary care clinics, the integrated practices performed better on some but not all quality and utilization measures. They found the practices had higher rates of depression screening, greater adherence to a diabetes care bundle, and greater documentation of self-care plans, but a lower proportion of patients with controlled hypertension, and no significant difference in documentation of advanced directives. They also found rates of emergency department (ED) visits, hospital admissions (including admissions for conditions sensitive to ambulatory care), and primary care physician encounters were lower, but there was no significant difference in visits to urgent care facilities or specialists. The program also reduced payments to the health system by $115 per patient per year and cost the system $12.1 million to implement between 2010 and 2013, the period studied. B. Reiss-Brennan, K. D. Brunisholz, C. Dredge et al., “Association of Integrated Team-Based Care with Health Care Quality, Utilization, and Cost,” Journal of the American Medical Association, Aug. 23/30, 2016 316(8):826–34. 

Integration of Behavioral Health Care Services into Primary Care Reduces ED Use
This article describes a collaborative care model that UCLA Health introduced to increase access to behavioral health services for its patients, half of whom are covered by risk-based contracts. Modeled on the Improving Mood-Promoting Access to Collaborative Treatment program, the Behavioral Health Services program enhances screening for behavioral health conditions, streamlines referral processes, and encourages collaboration among physicians and behavioral health providers who work together in primary care practices. Since 2012, the program has tripled the number of patients receiving behavioral health services and produced a 13 percent reduction in emergency department use among patients served, the sole measure used to assess impact on acute care services. Reimbursements for services were insufficient to cover program expenses, but UCLA Health hopes that shared savings payments from its ACO contracts will help to make up the difference. R. M. A. Clarke, J. Jeffrey, M. Grossman et al., “Delivering on Accountable Care: Lessons from a Behavioral Health Program to Improve Access and Outcomes,” Health Affairs, Aug. 2016 35(8):1487–93.

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Editorial Advisory Board

Special thanks to Editorial Advisory Board members Sara Rosenbaum, J.D., and Laura Gottlieb M.D., M.P.H., for their help with this issue.

Eric Coleman, M.D., M.P.H., professor of medicine, University of Colorado

Mike Chernew, Ph.D., professor of health policy, Harvard Medical School

Marshall Chin, M.D., M.P.H., professor of healthcare ethics, University of Chicago

Don Goldmann, M.D., chief medical and scientific officer, Institute for Healthcare Improvement

Laura Gottlieb, M.D., M.P.H., assistant professor of family and community medicine, University of California, San Francisco, School of Medicine

Carole Roan Gresenz, Ph.D., senior economist, Rand Corp.

Thomas Hartman, vice president, IPRO

Clemens Hong, M.D., M.P.H., medical director of community health improvement, Los Angeles County Department of Health Services

Lauren Murray, director of consumer engagement and community outreach, National Partnership for Women & Families

Kathleen Nolan, managing principal, Health Management Associates

J. Nwando Olayiwola, M.D., M.P.H., associate professor of family and community medicine, UCSF School of Medicine

James Pelegano, M.D., M.S., assistant professor of healthcare quality and safety, Thomas Jefferson University

Harold Pincus, M.D., professor of psychiatry, Columbia University

Chris Queram, M.A., president and CEO, Wisconsin Collaborative for Healthcare Quality

Sara Rosenbaum, J.D., professor of health policy, George Washington University

Michael Rothman, director of quality and operations support, The Permanente Medical Group

Stephen Somers, Ph.D., president and CEO of Center for Health Care Strategies

Mark A. Zezza, vice president, Lewin Group

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