Incentivizing healthy eating could have big payoff for Medicaid, Medicare

By | March 26, 2019

Dive Brief:

  • Helping adults on Medicare and Medicaid afford healthy foods could be a cost-effective tactic to improve population health, a study published in PLOS Medicine suggests.
  • The researchers simulated the impact of a 30% subsidy on either fruits and vegetables or a broader array of healthful foods on four measures: incidence of cardiovascular disease and diabetes, quality-adjusted life years (a measure of disease burden), health-related costs and incremental cost-effectiveness ratios. 
  • Use of the F&V incentive resulted in 1.93 million fewer CVD events, added 4.64 QALYS and saved $ 39.7 billion in formal healthcare costs. The healthy foods incentive prevented 3.28 million CVD events as well as 120,000 diabetes cases, gained 8.40 million QALYS and lopped $ 100.2 billion off costs.

Dive Insight:

The study reflects growing support for including food insecurity and other social determinants of health in population health efforts. Last year, CMS provided more flexibility for Medicare Advantage plans to offer nonmedical benefits to members with chronic diseases, including the possibility of meal delivery.

On the provider side, Intermountain Healthcare is investing $ 12 million in a collaborative effort with city, county and state government agencies and community-based organizations in Utah to address issues like housing instability, utility needs and food insecurity.

The new study found that both incentives researchers modeled were cost-effective beginning at five years, with lifetime incremental cost-effectiveness ratios of $ 18,184/QALY with F&V and $ 13,194/QALY with the healthy foods incentive.

Five and 10 years in, both programs were somewhat more cost-effective with Medicare and dual-eligible versus Medicaid populations. However, at 20 years and over simulated participants’ lifetimes, the programs proved more cost-effective in Medicaid — about $ 6,000/QALY versus $ 10,000/QALY for Medicare — suggesting a greater long-term impact on younger adults.

Subsidy costs for the F&V and health foods initiatives averaged about $ 110 and $ 185 per beneficiary per year, respectively, and were as or more cost-effective than existing medical interventions, according to the study.

“Given that economic incentives through Medicare and Medicaid are being considered to promote health, our results highlight the need to prioritize diet as a key component to improve outcomes with health insurance programs,” the authors write.

The results have policy implications at both the federal and state level. For example, public-private partnerships could provide financial incentives to buy healthy foods. At the state level, the authors cite California’s 2019 launch of a $ 6 million pilot program to cover medically tailored meals for its Medicaid population.

These results also have implications for designing and assessing interventions funded by the new Produce Prescription Program, authorized under the 2018 Farm Bill to incentivize patients to eat more fruits and vegetables, the authors note.

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