Valuing the cross-sector benefits from improving youth health to drive investment in place-based preventive interventions in the US: A simulation modeling study

Highlights

• Place-based preventive interventions could improve population health, but they are not widely implemented in the US.

• Benefits accrue over the long-term and cross-sector, creating a challenge of aligning incentives and mobilizing investment.

• A benefit-cost simulation model was used to estimate the benefits across sectors of improving ten different youth outcomes.

• For an effect size of 0.10 on each youth outcome, the median total benefit over ten years was $242 (range: $14 to $1357).

• These estimates can guide policymakers in making investments or community stakeholders in contracting to align incentives.

Abstract

Healthcare payment reform has not produced incentives for investing in place-based, or population-level, upstream preventive interventions. This article uses economic modeling to estimate the long-term benefits to different sectors associated with improvements in population health indicators in childhood. This information can motivate policymakers to invest in prevention and provide guidance for cross-sector contracting to align incentives for implementing place-based preventive interventions. A benefit-cost model developed by the Washington State Institute for Public Policy was used to estimate total and sector-specific benefits expected from improvements to nine different population health indicators at ages 17 and 18. The magnitudes of improvement used in the model were comparable to those that could be achieved by high-quality implementation of evidence-based population-level preventive interventions. Benefits accruing throughout the lifecycle and over a ten-year time horizon were modelled. Intervention effect sizes of 0.10 and 0.20 demonstrated substantial long-term benefits for eight of the nine outcomes measured. At an effect size of 0.10, the median lifecycle benefit per participant across the ten indicators was $3080 (ranged: $93 to $14,220). The median over a 10-year time horizon was $242 (range: $14 to $1357). Benefits at effect sizes of 0.20 were approximately double. Policymakers may be able to build will for additional investment based on these cross-sector returns and communities may be able to capture these cross-sector benefits through contracting to better align incentives for implementing and sustaining place-based preventive interventions.

Introduction

Many of the greatest health-related societal costs come from chronic conditions with modifiable risk factors, such as behavioral health conditions.^1,2 While many risk factors can be altered through individual clinical encounters in medical settings, “place-based” (or population-based) interventions may offer a more cost-effective and equity-promoting strategy in some instances (Frieden, 2010; National Academies of Sciences, Engineering, and Medicine, 2017). Place-based interventions are provided to groups of people by creating new resources, programs, or other assets in the community – offering the opportunity for greater efficiencies than clinical interventions which are provided one individual at a time. For example, clinical behavioral interventions can mitigate health conditions such as obesity or depression for individuals that receive them (Cuijpers et al., 2014), but place-based interventions such as building walkable communities or incorporating social and emotional learning programs in schools can benefit all individuals in an area and drive population-level change (Taylor et al., 2017). The importance of such place-based strategies has been widely acknowledged in the US, with efforts such as the National Academy of Medicine's (NAM's) Vital Signs Initiative proposing a framework for community-level accountability for health (Institute of Medicine, 2015). However, implementation of these interventions has been slowed by incentive misalignment in healthcare financing (Briggs et al., 2018; Wong et al., 2018). To support greater incentive alignment and additional investment, this paper uses simulation modeling to project financial returns to different sectors from place-based preventive interventions.

Current misalignment across healthcare and other sectors disincentivizes the implementation of place-based preventive interventions. Traditional fee-for-service healthcare reimbursement only accommodates individualized or small group clinical interventions. Healthcare reform has begun to shift these incentives, but most of the focus is on achieving rapid returns to healthcare payers or at-risk provider organizations, rather than longer-term prevention strategies. This arises in part because healthcare cannot capture much of the financial benefit of prevention, as many of the returns ultimately accrue to other sectors – also known as the “wrong pocket problem” (Butler, 2015).

To overcome this barrer, policymakers could “invest” in place-based interventions based on the long-term returns to the entire public budget (which would thus span multiple sectors) or gain political support based on the returns to private budgets across different sectors. Alternatively, incentives could be aligned across sectors through contracting. For example, a community coalition could contract with Medicaid managed care and the county government to share the long-term benefits to each of the different sectors from reducing the rate of mental health crises in the county, incentivizing the coalition to implement and sustain new crisis response, treatment, and prevention options that will allow them to share savings from decreased jail and hospital admissions. Both approaches face policy constraints, but when flexibility is possible, policymakers and other stakeholders will need a way to value improvements in health based on the associated benefit to each sector to overcome wrong pocket problems.

The Washington State Institute for Public Policy (WSIPP) benefit-cost model offers a way to estimate the benefits to different sectors from effects on key population health indicators, which could support policymaker investment or private contracting (Lee and Aos, 2011). Since 1995, WSIPP has conducted economic analyses to inform the Washington state legislature's policy-making, and its benefit-cost analysis model has been adapted for application to other states and counties through the Pew-MacArthur Results First Initiative (Vanlandingham and Drake, 2012). WSIPP's model uses consistent methods for estimating benefits from a variety of health improvements, includes a Monte Carlo feature to assess the implications of uncertainties on parameter estimates, and is subjected to regular reviews by a panel of independent experts.

Using the WSIPP model, this paper estimates benefits to different sectors from improving health and related outcomes across a geography. Our model could be used by policymakers or community stakeholders interested in implementing place-based preventive interventions in the US and that need to demonstrate the value across sectors to motivate investment or drive contracting. The paper focuses on behavioral health and related outcomes at age 18, a critical time for developing cognitive, affective, and behavioral competencies that drive long-term health and economic outcomes. Indicators include substance use initiation (alcohol, cigarette, marijuana, and other drug use), mental health disorder (major depression and anxiety), physical health (obesity), teen pregnancy, and high school graduation.