Health equity and value-based payment systems: Moving beyond social risk adjustment

Recent Health Affairs articles and blog posts have advocated for social risk adjustment in value-based payment (VBP) systems. This has been an area of significant analysis and deliberation within the Office of the Assistant Secretary for Planning and Evaluation (ASPE) at the Department of Health and Human Services. It was also the subject of two Reports to Congress by our team required by the Improving Medicare Post-Acute Care Transformation (IMPACT) Act of 2014, the first in December 2016 and the second in March 2020.

In those reports, we did not recommend wide-scale social risk adjustment in Medicare’s VBP programs. We contend that a debate over social risk adjustment in isolation is too narrow a lens for considering the systematic problem of lower-quality care and poor outcomes for vulnerable patients; we believe that it would be more fruitful to take a broader approach toward improving health equity. In this post, we describe some of the thinking and data analysis in our reports, then suggest a broader agenda for tackling policy challenges related to social risk and health equity, through our health-related programs as well as through a variety of social service programs.