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May 30, 2019

The 'secret' to lower health care costs, according to Mount Sinai's CEO

Daily Briefing

    In America's debate about how to rein in health care spending, "we're missing a critical piece of the puzzle," Kenneth Davis, president and CEO of Mount Sinai Health System, and Robert Rubin, former secretary of the Treasury Department, write in a New York Times opinion piece.

    June 13 webconference: Social Determinants 101

    Why investing in social services can reduce health care spending

    According to Davis and Rubin, the "secret" to better health care and lower spending in the United States lies in the "inverse relationship between health care costs and spending on social programs." They write that a key reason why the United States spends more than any other nation on health care is that "we spend far less on social services," such as public housing, food stamps, and school lunch programs.

    "If our spending on social programs were more in line with other developed countries, our health care costs would fall," they write. That's because those programs address "what medical professionals call the social determinants of health," which relate to "the environment in which people are born, grow, live, and work."

    When implemented effectively, Davis and Rubin write, social programs increase patients' access to things that are "critical to avoiding disease," including safe shelter, nutritious foods, and subsistence income.

    Davis and Rubin highlight two programs, one in Chicago and one in Los Angeles, to illustrate "the multidimensional benefits of social spending."

    "The Chicago program supplemented federal housing subsidies to help patients with chronic health problems afford stable housing," they write. That program reduced health care costs for the University of Illinois hospital system by about 18%.

    The Los Angeles program also offered housing assistance to patients, and it "showed even greater cost savings," Davis and Rubin write. Inpatient services declined by 75%, according to a RAND Corporation study, and overall health care and social service costs fell by 20%. The beneficiaries' mental health also improved, the study found.

    Should the US invest more in social spending?

    Despite the "reams of data" to support spending to address the social determinants of health, "the United States continues to spend a relative pittance on such programs," Davis and Rubin write. Housing programs are only .25% of the United States gross domestic product, and nutrition programs, including food stamps, are only .5% of GDP.

     "Our underinvestment sets us apart from other advanced nations around the globe," which "boast a higher life expectancy," Davis and Rubin write.

    And while there are many factors that distinguish the spending and health outcomes of the United States from those of other developed nations, "we won't effectively reduce costs, and improve outcomes, until we think bigger and recognize the critical link between health care spending and social programs," they conclude (Davis/Rubin, New York Times, 5/27).

    June 13 webconference: Social Determinants 101

    To effectively manage your patients' care, it's not enough to ask care teams to address their social needs; you also must team up with community-based organizations to provide non-clinical support.

    Join us on Thursday, June 13 at 1 pm ET to learn the case for collaboration with community partners, and the options for engagement based on resource intensity and target population.

    Register Now

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