Private capital is a key component to improving health equity

Individual Author(s) / Organizational Author
Enekwechi, Adaeze
Health Affairs
June 2023
Abstract / Description

Efforts to advance health equity are a recognition that there is significant opportunity to improve health outcomes for traditionally underserved populations. Academic research continues to offer deeper understanding of the gaps in quality, access and outcomes that suggest there is much room for improvement. Policymakers have also made recent efforts to advance health equity using levers available to large, influential purchasers. The Center for Medicare and Medicaid Innovation (CMMI) through the ACO REACH (Realizing Equity, Access and Community Health) demonstration will include some health equity measures, including person-level demographic data and a quality bonus for submission, as well as having a patient advocate on every board. Similarly, the Centers for Medicare and Medicaid Services recently finalized provisions that will require providers to describe their ability to provide linguistically, culturally competent care and strengthen marketing materials to reflect what plans can realistically cover.

Several states have also made health equity a central focus through their Medicaid programs. Medicaid coverage expansion has been linked to improvements in coverage and access to care. But with 11 states still not adopting Medicaid expansion, and millions rolling off Medicaid due to the end of the Public Health Emergency, many Americans are left with little ability to bridge widening access gaps. While these federal and state policy provisions are important, they still seem modest when compared against the scope and scale of disparities in health. The role of private capital in moving the needle on health care is not yet fully realized and could be the next frontier.

The health care sector needs access to private capital to innovate, serve individuals with complex needs, and become more efficient and equitable in service to patients. What is the alternative to private capital in health care if we have a goal of expanding models of care and types of providers, and making the technological advances needed to serve more people better? Public resources are stretched thin and cannot be relied on to grow in perpetuity above the nearly $1 trillion spent on Medicare and Medicaid alone. Federal funders like the National Institutes of Health, the National Science Foundation, and the Centers for Disease Control and Prevention support discrete research or training grants, and while they might incubate innovations, these funds will not support building or scaling new companies.

Foundations serve a meaningful purpose in augmenting public funds but do not command nearly enough resources to drive change at the scale that we contemplate. And even foundation funding can have significant strings attached, with short-term funding cycles that can end programs abruptly. Founders and innovators focused on health equity, with an understanding of what patients need in a fractured health care system, should be given an opportunity to build and grow a business, then successfully exit the business and move on to other ventures. (author introduction) #P4HEwebinarNovember2023

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