Society of General Internal Medicine position statement on social risk and equity in Medicare's mandatory value-based payment programs

The Affordable Care Act (2010) and Medicare Access and CHIP Reauthorization Act (2015) ushered in a new era of Medicare value-based payment programs. Five major mandatory pay-for-performance programs have been implemented since 2012 with increasing positive and negative payment adjustments over time. A growing body of evidence indicates that these programs are inequitable and financially penalize safety-net systems and systems that care for a higher proportion of racial and ethnic minority patients. Payments from penalized systems are often redistributed to those with higher performance scores, which are predominantly better-financed, large, urban systems that serve less vulnerable patient populations - a "Reverse Robin Hood" effect. This inequity may be diminished by adjusting for social risk factors in payment policy. In this position statement, we review the literature evaluating equity across Medicare value-based payment programs, major policy reports evaluating the use of social risk data, and provide recommendations on behalf of the Society of General Internal Medicine regarding how to address social risk and unmet health-related social needs in these programs. Immediate recommendations include implementing peer grouping (stratification of healthcare systems by proportion of dual eligible Medicare/Medicaid patients served, and evaluation of performance and subsequent payment adjustments within strata) until optimal methods for accounting for social risk are defined. Short-term recommendations include using census-based, area-level indices to account for neighborhood-level social risk, and developing standardized approaches to collecting individual socioeconomic data in a robust but sensitive way. Long-term recommendations include implementing a research agenda to evaluate best practices for accounting for social risk, developing validated health equity specific measures of care, and creating policies to better integrate healthcare and social services.