Community health workers focusing on social needs provided return on investment for Medicaid, study finds

A community health worker model focusing on patients' social determinants of health achieved a favorable return on investment for Medicaid payers, according to a recent study.

Researchers used outcomes data from a randomized trial of the Individualized Management for Patient-Centered Targets (IMPaCT) intervention, in which community health workers address patients' unmet social needs, to estimate the cost savings generated. The data examined included the number and acuity of inpatient admissions, inpatient charges, and number of outpatient visits, as well as annual program expenses. Results were published in the February Health Affairs.

Total annual expenses for the full program team were $567,950.82, and the estimated total Medicaid cost per admission was $16,478. The intervention arm of the randomized trial had fewer and lower-cost admissions than the control arm (total inpatient cost, $2,267,900.10 vs. $3,681,206.88). Total cost of care including outpatient costs was $2,450,881.80 for the intervention arm and $3,852,189.78 for the control arm, meaning that the intervention was associated with a 38% decrease in costs.

A community health worker team was estimated to save Medicaid $1,401,307.99, which, when divided by the program expenses, meant a return of $2.47 for each dollar invested over a fiscal year. A sensitivity analysis that varied the number of admissions and outpatient visits attributable to the intervention found a return ranging from $1.84 to $3.09.

Authors stressed that these findings are specific to IMPaCT and that caution should be used when extrapolating them to other community health worker programs. They also pointed out that return on investment can vary based on who is investing and who is receiving the return, noting that clinicians often bear some of the costs for community health worker programs and only see returns if certain conditions are met. In addition, the authors said, financial return on investment underestimates the benefit of such programs focusing on unmet social needs.

“Interventions that increase recommended cancer screening, facilitate lead testing in children, or identify patients with hypertension through community outreach can enormously advance health even as they remain invisible to systems that measure only charges that flow through accounting systems with one-year time horizons,” the authors wrote. “Even accountable care drivers, which seemingly focus on value, typically focus on the value seen on balance sheets. In contrast, patients measure value in units that are almost always off the books.”

The November/December 2019 ACP Internist featured a cover story on community health worker programs, including IMPaCT.