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The Effects of Financial Structures to Increase Social Drivers of Health Investments in Medicaid: A Simulation Approach.

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Title: The Effects of Financial Structures to Increase Social Drivers of Health Investments in Medicaid: A Simulation Approach.
Authors: Fang, Francis Haoyu, Karaca-Mandic, Pinar, Thakor, Richard T.
Source: American Journal of Public Health. 2026 Suppl 3, Vol. 116, pS210-S217. 8p.
Subjects: Computer simulation, Statistical models, Managed care programs, Social determinants of health, Research funding, Health insurance reimbursement, Health status indicators, Investments, Cost benefit analysis, Health care reform, Organizational effectiveness, Financial management, Medicaid, Labor incentives, Medical care costs, Pay for performance, Economics
Geographic Terms: United States
Abstract: Objectives. To explore and quantify the potential effects of financial innovations aimed at increasing investments in social drivers of health (SDH). Methods. We built a simulation model in which individuals in a health care market are served by multiple Medicaid managed care organizations (MCOs). In our model, each MCO can spend money to make SDH investments that improve patient health and reduce costs to the MCO, but patients can switch between different MCOs. Results. While SDH investments improve patient health and increase the profitability of the investing MCO, the benefits also accrue to noninvesting MCOs because of the churn of patients between MCOs, resulting in a "wrong-pocket problem" where investing MCOs bear the costs but share the benefits with competitors, resulting in worse financial returns compared with making no investments and ultimately disincentivizing SDH investments. Outcomes can be improved when all MCOs participate in a financial structure—an SDH bond—which raises money from investors and distributes the proceeds to MCOs to make SDH investments. Conclusions. An SDH bond can improve patient health and increase profits for MCOs because of cost-savings. (Am J Public Health. 2026;116(S3): S210–S217. https://doi.org/10.2105/AJPH.2026.308479) [ABSTRACT FROM AUTHOR]
Copyright of American Journal of Public Health is the property of American Public Health Association and its content may not be copied or emailed to multiple sites without the copyright holder's express written permission. Additionally, content may not be used with any artificial intelligence tools or machine learning technologies. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)
Database: Psychology and Behavioral Sciences Collection
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  Data: The Effects of Financial Structures to Increase Social Drivers of Health Investments in Medicaid: A Simulation Approach.
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  Data: <searchLink fieldCode="AR" term="%22Fang%2C+Francis+Haoyu%22">Fang, Francis Haoyu</searchLink><br /><searchLink fieldCode="AR" term="%22Karaca-Mandic%2C+Pinar%22">Karaca-Mandic, Pinar</searchLink><br /><searchLink fieldCode="AR" term="%22Thakor%2C+Richard+T%2E%22">Thakor, Richard T.</searchLink>
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  Data: <searchLink fieldCode="JN" term="%22American+Journal+of+Public+Health%22">American Journal of Public Health</searchLink>. 2026 Suppl 3, Vol. 116, pS210-S217. 8p.
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  Data: Objectives. To explore and quantify the potential effects of financial innovations aimed at increasing investments in social drivers of health (SDH). Methods. We built a simulation model in which individuals in a health care market are served by multiple Medicaid managed care organizations (MCOs). In our model, each MCO can spend money to make SDH investments that improve patient health and reduce costs to the MCO, but patients can switch between different MCOs. Results. While SDH investments improve patient health and increase the profitability of the investing MCO, the benefits also accrue to noninvesting MCOs because of the churn of patients between MCOs, resulting in a "wrong-pocket problem" where investing MCOs bear the costs but share the benefits with competitors, resulting in worse financial returns compared with making no investments and ultimately disincentivizing SDH investments. Outcomes can be improved when all MCOs participate in a financial structure—an SDH bond—which raises money from investors and distributes the proceeds to MCOs to make SDH investments. Conclusions. An SDH bond can improve patient health and increase profits for MCOs because of cost-savings. (Am J Public Health. 2026;116(S3): S210–S217. https://doi.org/10.2105/AJPH.2026.308479) [ABSTRACT FROM AUTHOR]
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  Data: <i>Copyright of American Journal of Public Health is the property of American Public Health Association and its content may not be copied or emailed to multiple sites without the copyright holder's express written permission. Additionally, content may not be used with any artificial intelligence tools or machine learning technologies. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract.</i> (Copyright applies to all Abstracts.)
PLink https://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=pbh&AN=194806715
RecordInfo BibRecord:
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      – Type: doi
        Value: 10.2105/AJPH.2026.308479
    Languages:
      – Code: eng
        Text: English
    PhysicalDescription:
      Pagination:
        PageCount: 8
        StartPage: S210
    Subjects:
      – SubjectFull: Computer simulation
        Type: general
      – SubjectFull: Statistical models
        Type: general
      – SubjectFull: Managed care programs
        Type: general
      – SubjectFull: Social determinants of health
        Type: general
      – SubjectFull: Research funding
        Type: general
      – SubjectFull: Health insurance reimbursement
        Type: general
      – SubjectFull: Health status indicators
        Type: general
      – SubjectFull: Investments
        Type: general
      – SubjectFull: Cost benefit analysis
        Type: general
      – SubjectFull: Health care reform
        Type: general
      – SubjectFull: Organizational effectiveness
        Type: general
      – SubjectFull: Financial management
        Type: general
      – SubjectFull: Medicaid
        Type: general
      – SubjectFull: Labor incentives
        Type: general
      – SubjectFull: Medical care costs
        Type: general
      – SubjectFull: Pay for performance
        Type: general
      – SubjectFull: Economics
        Type: general
      – SubjectFull: United States
        Type: general
    Titles:
      – TitleFull: The Effects of Financial Structures to Increase Social Drivers of Health Investments in Medicaid: A Simulation Approach.
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            NameFull: Fang, Francis Haoyu
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            NameFull: Karaca-Mandic, Pinar
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            – D: 02
              M: 07
              Text: 2026 Suppl 3
              Type: published
              Y: 2026
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