MedCity Influencers, Payers, Community

Building mutually-beneficial partnerships between payers and community-based organizations

The sustainable route to building a more integrated healthcare ecosystem is through partnerships. But for these collaborations to be successful, communication and clear financial incentives need to be aligned between payers and community-based organizations. 

As we rebuild our communities from the Covid-19 crisis, we must work together to close the health equity gaps that have become more evident.

The path to sustainability and improved health outcomes requires a collaborative effort. To meet the most pressing needs of the hardest-hit communities, we must support community-based organizations (CBOs) who actively address social drivers of health and build more effective interventions that promise longer-term solutions.

Four challenges CBOs and payers face

Payers, providers, and CBOs have a long history of contrasting objectives. It goes without saying that the sustainable route to building a more integrated healthcare ecosystem is through partnerships. But for these collaborations to be successful, communication and clear financial incentives need to be aligned. 

For both payers and CBOs, finding this alignment and building mutually-beneficial partnerships has typically been challenging. We’ve found that there are two main reasons why these partnerships have failed in the past. The first is trust and alignment. All stakeholders—CBOs, payers, and healthcare organizations—must have a seat at the decision-making table to ensure trust and alignment. The second reason is limited funding. Payers have more funds than CBOs, which can create an asymmetrical power dynamic. To support CBOs, payers should consider payment models that enable CBOs to increase capacity, resources and capabilities.

The American Journal of Public Health recently addressed the challenges of building cross-sector relationships, suggesting, “The successful integration of health and social services may depend on several components, including the level at which integration occurs, the partners taking part, whether the partners have shared goals and roughly equal willingness and ability to contribute, and the degree of integration.”

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Working toward the same goals

Moving away from the fee-for-service model, payers and CBOs can implement quality programs focused on social determinants of health (SDoH) to reimagine the impact of preventative care and quantify services based on their direct impact on population health.

Let’s say 100,000 members in a community are “at-risk for food insecurity.” Payers can make the conscious decision to allocate $5 million ($50 per person per week) to CBOs that run food programs in the area. To measure the success of that decision, payers can evaluate closed-loop referrals, emergency room visits, hospitalizations, chronic care costs, and additional health-related costs.

A value-based system like this aims to provide patients with high-value care that improves their overall health and lowers long-term medical costs. Value is measured by evaluating health outcomes in relation to the cost of achieving that improvement.

Suppose we’re successfully using this system to address SDoH. In that case, payers and CBOs will have the same goal of bettering population health and can work in alignment to integrate their systems, share data, measure patient outcomes, and participate in a reimbursement model that offers CBOs more concrete incentives.

More risk equals more reward

In a risk-sharing model driven by value, CBOs are encouraged to become more active participants. When both partners agree to take financial risks (based on predictive data, of course), they should share profits. It’s that simple. Financially supporting CBOs won’t just improve the payer-CBO partnership but will positively change the health outcomes of at-risk populations, many of whom are in low-income and rural communities.

As social services networks grow and become more valuable, CBOs may have to expand their service offerings, rework their organizational structures, and improve their coordination services, but they will at least have the funding to do so—and payers will know their money is being used for the best quality care.

The path to health equity isn’t possible without CBOs on the ground working to meet the health needs of high-risk populations. The payer-CBO relationship, if successfully executed, could prove to be the most beneficial in the healthcare ecosystem.

Photo: alphaspirit, Getty Images


Manik Bhat is the Founder and Chief Executive Officer of Healthify. He was moved to create Healthify in 2013 while working as a community health worker in East Baltimore, where he saw how social needs dramatically impacted health outcomes in the community. Manik is an advocate for addressing the social determinants of health through equitable and collaborative partnerships between healthcare and social service organizations

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