Signals | March 9, 2017

Healthcare: Beyond the Zero-Sum War Over Resources

The team at


For those of you who like your healthcare policy analysis in 140-character snippets, I wrote this as a Tweet storm Tuesday night and have now embellished it with additional details:

It’s hard to see the GOP’s proposed healthcare reform as anything but an assault on poor people, especially with the inevitable cuts to Medicaid to come.

[blockquote author=”Antony Bugg-Levine, Nonprofit Finance Fund” pull=”pullleft”]When we organize instead around desired outcome…we will more often address problems before they become a problem.[/blockquote]

This is not surprising given the current frame of the healthcare debate as a zero-sum resource war (rich white people vs. poor people of color). Instead, we need a sober debate that acknowledges the challenge inherent in building an inclusive health system within fiscal constraints.

There is a way out of this death-match: a value-based system channeling money to more efficient ways to help more people stay healthy. This requires a fight for investments in preventative, community-based interventions, not just greater share of hospital and doctor payments.

What if we discharged ER patients to supportive housing, not back onto street? What if we removed air pollutants from housing projects (and regulated nearby diesel fuel emissions) rather than treat asthma in ERs?

What if we provided homebound people with healthy meals, rather than treat their diabetes? What if we made park exercise safe, rather than treat heart attacks? What if we expand substance abuse rehab, rather than treat overdoses?

There are so many opportunities to improve health outcomes inclusively at lower cost; we see hundreds of ideas and pilots at Nonprofit Finance Fund.

Outcomes for addicts

Take opioid addiction, a public health crisis that is destroying families and communities across in blue states and red states, in cities and rural areas. Its causes are as complex as its impact is wide-ranging; solving it will require coordinated action from across the public and private sectors.

In Portland, Maine, local leaders are tackling this crisis with a collaborative effort. The Greater Portland Addiction Collaborative, catalyzed by Mercy Hospital, is bringing together healthcare providers and homeless shelter operators, as well as law enforcement and the courts, in an integrated, community-led initiative that will serve 1,200 people most in need of support.

This coordinated community response is conceptually simple. Investing upfront in a range of supportive services from local nonprofits working with the hospital and government can ultimately save taxpayers millions of dollars in avoided hospital treatments covered by Medicaid and court and jail costs.

At the center of this and other similar interventions across the country is a realization that if we do this well, we will not only address these challenges, we will also substantially reduce the costs of doing so.

This may seem obvious. But most of our social spending does not actually pay for results, such as reducing opioid overdoses. Instead, funders, usually government, pay social service organizations to undertake activities, such as providing drug counseling or giving an addict a bed in a homeless shelter. These activities are often helpful but can’t on their own address the wider problem.

When we organize instead around the desired outcome, we are forced to see how the pieces fit together and to collaborate across traditional silos of public and private sector. And we will more often address problems before they become a problem, like the Maine group is doing to prevent substance abuse, rather than just hospitalizing and jailing people who suffer from it.

Organizing around outcomes

What will take to collaboratively organize around outcomes?

Learn by doingNew ways of doing things are always held to higher levels of scrutiny than business as usual. It’s easy to get caught in an endless cycle of research and analysis to prove that collaboration is worth it or results predictable. We need to get comfortable with taking leaps and adjusting as we learn.

Identify the win-winOrganizing around outcomes is often a much more efficient way to address a social problem in theory. But individuals and institutions are oriented to getting the most out of the current way of working. For collaborative ideas to take off, they must benefit all the people we need to join us, in all levels of government, the private sector, and the ultimate beneficiaries of services. We must identify who could be threatened by change and figure out how to help them benefit as well.

Build trust: Outcomes-oriented approaches often require collaboration between people unused to working together. In the Maine example, hospital workers, homeless shelter operators, drug treatment professionals and the police have come together around common goals. We must take the time to understand the values and constraints that everyone works under, rather than allowing ourselves to fall back onto stereotypes about people and organizations we may not know well.

Invest in social service groupsLocal community-based groups hold the keys to driving improved health outcomes at lower cost. They run the community centers, organize the local self-help groups, provide healthy meals to homebound people, and a wide range of other services that can keep people healthy and out of the expensive hospital care. To play their part, they need support to expand their programs and to invest in operating in a new way. They need to know the government and private donors will have their backs if they operate in a more outcomes-driven way. The federal budget cannot both gut discretionary spending on safety net programs and reap the savings of their ability to reduce healthcare costs.

Unfortunately, as I learned at policy school: “there is no constituency for efficiency.” A huge systems-change challenge is required to pull this off, in which hospitals, community groups and government form new collaborations.

It’s also hard to see any healthcare plan working without strong regulations aimed at creating the conditions that will enable more people to enjoy better health. The medical field is coming around to recognize how much of our health is driven by “social determinants,” such as air quality, housing, clean water and good education.

Improving these drivers of health could be far more cost effective than trying to squeeze better clinical outcomes from hospital care. But to do this will require smart regulation to limit pathologies like pollution and gun violence, and broad investments in housing, public education and public transport.

[seperator style=”style1″]Disclosure[/seperator]

The Nonprofit Finance Fund works with a range of partners, including the Healthy Outcomes Initiative with the Kresge Foundation, as a co-investor with Dignity Health, and in collaboration with the Robert Wood Johnson Foundation. We are covering these issues in our forthcoming book with the Federal Reserve Bank of San Francisco. Sign up for news on that work here.  

Photo credit: AP Photo/Susan Walsh