Medicaid Spending Curbed by North Carolina Program Addressing Social Determinants of Health

A first of its kind, state-run pilot program called the Healthy Opportunity Pilots (HOP) decreased Medicaid spending by addressing health-related social needs, according to a study recently published in JAMA.

Data showed that healthcare spending for HOP enrollees increased during the first month, but spending averaged out to be $85 less per enrollee per month, compared with other Medicaid enrollees. By about eight months, healthcare spending for those in the program was about what it would have been had HOP not existed and continued to drop. Emergency room visits also dropped for HOP enrollees, with an average of 6 fewer visits per person per month when compared with other Medicaid enrollees, the evaluation shows.

“What we saw in the results suggests that [HOP] is working,” lead author Seth A. Berkowitz, M.D., M.P.H., an associate professor and section chief for research in the Division of General Medicine and Epidemiology in the UNC School of Medicine, said during a phone interview today with Managed Healthcare Executive. “We're needing to spend less on health care, [so] that people aren't having as many emergency department visits, which is a sign that people are getting healthier through participation in this program.”

Seth A. Berkowitz, M.D., M.P.H.

HOP was implemented in 33 counties across North Carolina and provided access to services such as healthy food boxes and housing navigation assistance.

Berkowitz and his colleagues researchers analyzed North Carolina Medicaid data from March 2021 through November 2023, comparing the health data of 13,227 HOP enrollees with 73,469 Medicaid recipients who expressed interest in HOP but were ineligible due to living outside of participating counties.

HOP operates under a waiver that allows states to offer services not typically covered by Medicaid. Programs like these typically require evaluations to determine effectiveness, Berkowitz noted

The most common services utilized by HOP enrollees were access to a healthy food box (74.1%), housing navigator support services (7.9%), and a fruit and vegetable prescription (7.2%), the evaluation shows. At least 89% of HOP enrollees received at least one HOP service.

“Imagine you have diabetes,” Berkowitz said. “Typically, we might prescribe you medications or have you work with a nutritionist, and that usually improves people's diabetes, and Medicaid pays for these services. But if you also are facing food insecurity, then those treatments may not work like they should. Programs like this allow us to address the factors that would otherwise make the medical care that people are getting much less effective.”

The HOP program was initially approved to run for five years, but CMS approved an extension request in December 2024, allowing it to continue for another five years.

“Building an evidence base like this study helps make an informed decision about whether programs like these should be included in Medicaid or other health insurance programs,” Berkowitz said. “This [evaluation] is good evidence for the idea that addressing health-related social needs can improve health and is panning out in the real-world interventions.”