VH Insights

Reduce Healthcare Disparities
September 19, 2022

How Does Managed Care Reduce Healthcare Disparities?

Over the past few decades, health programs such as Medicare and Medicaid have increasingly turned their attention to solving the social and economic inequalities that contribute to health disparities. As they continue to strategize on the best ways to address health disparities, many plans and states are gradually shifting to managed care models in response.

Ahead, we break down the challenges surrounding health disparities and care inequities and look at the ways managed care can help alleviate both issues and provide greater health equity for all.


Key Takeaways

  • Social and economic inequalities lead to health disparities that result in negative outcomes and a higher total cost of care.
  • Many health plans and states are shifting to managed care models to control the rising costs of healthcare and advance health equity.
  • A data-driven approach to managed care can inform targeted interventions that help reduce disparities and drive better health outcomes.

Fighting an Uphill Battle: Constant Obstacles to Care

There are several factors that influence healthcare disparities and impact one’s ability to achieve positive outcomes: race and ethnicity, geographic location, socioeconomic status, age, sex, gender identity, sexual orientation, and disability.

Generally speaking, any disadvantaged group – whether it’s a rural community with few primary care providers, underserved races and populations, or families with social determinants of health (SDoH) or other health-related social needs – is often excluded from access to the best healthcare resources.

When someone with COPD lives 40 miles from the nearest provider and doesn’t have reliable transportation, he won’t be able to get the regular checkups he needs to manage his condition. Or when a single mother is struggling to put food on the table and pay rent, preventive well checks may not be a priority. And when people don't have access to grocery stores with affordable, healthy foods, they are less likely to have good nutrition, increasing their risk of chronic health conditions such as obesity, heart disease, and diabetes.

The Problematic Impact of Health Disparities

Health disparities negatively impact health outcomes, quality of life, and the larger economy. And despite efforts to reduce healthcare disparities, they are decidedly still a major problem.

  • Black women are 3x more likely to die from a pregnancy-related cause than White women.
  • In 2020, American Indian and Alaska Native (AIAN), Black, Native Hawaiian and Other Pacific Islander (NHOPI), and Hispanic people had >3x more premature excess deaths per 100,000 people in the U.S. than White or Asian people. 
  • LGBTQ+ individuals have a 17% higher cancer death rate in rural areas of the country.

Health outcomes and SDoH – it’s a cause-and-effect relationship. If a patient has unresolved SDoH, they are more likely to have negative health outcomes. Someone who has lost their job or cannot afford basic needs such as food and housing may not be able to purchase medications to manage a chronic condition or pay for visits to address health concerns.

Moreover, health disparities are expensive – for patients, providers, and payers. Researchers estimate that disparities cost approximately $93 billion in excess medical care costs and $42 billion in lost productivity each year, plus additional economic losses due to premature deaths.

From a financial perspective, disparities can exacerbate issues certain patients may have accessing, affording, and prioritizing their health. For patients, especially those on a tight budget, preventive healthcare might be covered, but ED copays and the cost of a chronic or serious illness can be debilitating.

As noted above, health and SDoH are cyclically connected. If one suffers, the other suffers, and the cycle continues.

How Managed Care Can Combat Disparities and Improve Access to Health Care

Managed care plans are a type of health insurance where the plan contracts with a network of providers or facilities to provide care for members at a reduced cost. These plans focus on prevention and care management to serve members better, eliminate barriers to high-quality care, and increase positive outcomes.

Since it’s not driven by a fee-for-service model and typically includes a care management approach, managed care is better able to address SDoH and health disparities through:

  1. Targeted services to meet members' social needs, such as housing support, transportation assistance, mobile phone allowance, child care, and food and nutrition services.
  2. Financial savings for all parties (plans, health facilities, and patients) through controlled costs, free preventive care, no-cost screenings, and lower copays.
  3. The ability to keep families together, promoting continuity of and removing barriers to care. For example, parents can take all of their children to the same pediatrician, who understands the family dynamics, addresses social needs, and provides individualized care for each child.
  4. Enhanced benefits for eligible populations, such as dental and wellness through Medicare managed care, or maternity, transportation, and mobile phone support through Medicaid managed care.
  5. Boots-on-the-ground and grassroots approaches to care management. Managed Medicaid plans often try to fill outreach or care manager roles with local people who know and understand the needs of the community and population and can assess and address cultural differences in decision-making.
  6. A care management team focused on whole-person care, often including staff trained on health inequities, disparities, SDoH, diversity, and inclusion. The team has access to data and community resources that allow them to address SDoH, guide members through care- or social-related issues, and provide education about preventive care, medication, and disease management.
  7. Awareness, education, and health promotion resources to address the needs and conditions most commonly associated with health inequities, such as pregnancy planning and high-risk awareness, zero-cost contraceptives, care for children with complex conditions, breast and cervical cancer screenings, diabetes and hypertension management, and more.

A Data-Driven Approach to Resolving Health Inequality

One key function of managed care plans is collecting and analyzing data to uncover avoidable differences in outcomes. By analyzing claims, costs, medications, health status, and outcomes for particular populations, managed care organizations can identify the key actions to take to address racial, ethnic, socioeconomic, and other health disparities.

These efforts are even more focused and successful with a care platform that captures social and demographic data through integrations and targeted assessments. With a single, real-time view of each patient's physical, behavioral, and social health factors, organizations can perform population- and cohort-level analysis and stratification by race, ethnicity, sex, gender identity, sexual orientation, and geography to inform targeted interventions that can help reduce disparities.

By drilling down into care gaps, key health trends, patterns, and critical disparities emerge for a specific organization’s care base, such as:

  • A large percentage of people in a particular ZIP code have diabetes and have visited the ED in the past three months.
  • African American patients have higher rates of late-stage breast cancer and aren't getting regular mammograms
  • A percentage of teen patients with sickle cell disease (SCD) who are transitioning to adulthood are showing an increase in ED visits, hospital admissions, and difficulty accessing primary care resources

From there, managed care organizations can use automated workflows to develop and execute care plans and proactive interventions that close those gaps and drive efforts for health equity.

For example, if a care management team uses a platform with virtual care and remote patient monitoring (RPM) integration, they can easily and securely connect with patients via phone or video visits. In doing so, care teams can more proactively check-in with and monitor patients, as well as get ahead of high-risk issues. RPM integration also helps by automatically tracking vital signs like blood pressure or weight and triggering alerts for care managers to follow up if measures are outside of the acceptable range.

Population health and social data that’s actionable and integrated is one of the most impactful ways that managed care plans can address health disparities and inequities. But it all comes down to harnessing the power of critical data in a managed care model.

If harnessing the power of that critical data remains a hurdle for your organization, learn more about how HELIOS® can help you solve population health issues and provide more equitable care.

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