Cost Effectiveness of Health

How community partnerships can play a central role in reducing cost of care and improving health outcomes

January 24, 2023 4:30 pm

As average rent for a one-bedroom apartment in Chicago soared to nearly $2,000 a month, Illinois-based Cook County Health saw another unfortunate upward trend in housing insecurity and homelessness. That’s when the health system decided to partner with a city housing agency. The goal? To reduce healthcare costs and improve individual healthcare outcomes by connecting people to stable housing and supportive services.

“We know that homelessness makes a huge difference in terms of cost and utilization,” said Yvonne Collins, MD, chief medical officer of CountyCare within Cook County Health and Hospitals System. “It’s about helping people become and stay healthy.”

Yvonne Collins, MD

As part of this partnership, Cook County Health became one of several investors in a program called the Flexible Housing Pool (FHP). Here’s how it works.

First, Cook County Health identifies eligible patients. The health system defines these individuals as those who are homeless or housing insecure who have behavioral health and/or substance use issues, have children or are pregnant, have been incarcerated or institutionalized or have multiple chronic conditions.

Next, patients receive a referral to the Center for Housing and Health (CHH), a subsidiary of the AIDS Foundation of Chicago, which subsequently matches them with an apartment and provides case management services. For example, patients get help filling out Medicaid applications, performing employment searches, obtaining food stamps, managing conflicts with neighbors and more.

“People move in and sign a lease just like anyone else,” said Peter Toepfer, executive director for the CHH. “There’s no time limit, which means people can stay in the program for as long as they need.”

Peter Toepfer

The investment comes with a commitment to pay about $25,000 annually per household — something Collins said is well worth it, especially because she hopes the data collected from the program will help justify Medicaid coverage.

“If we can point to outcomes in terms of utilization of healthcare services, we know this will translate into savings not only for the health plans but for the state,” Collins said.

Preliminary data seems to indicate this is the case.

“Overall, we are seeing a trend toward a decrease in utilization and cost for the members who are enrolled in the Flexible Housing Pool,” said Jessica Chatman, senior manager of integrated care management programs at Cook County Health. Their continually growing cohort includes 53 members who have currently been housed between one and six months.

Jessica Chatman

Cook County Health continues to review inpatient, outpatient, emergency department (ED), ambulatory clinic and pharmacy claims for this cohort, particularly any outliers that could increase cost, said Chatman.

If the data continues to trend toward decreased cost and utilization, the health system can make a compelling argument for Medicaid coverage, Collins said.

“When housing insecurity impedes someone’s quality of life and health, we should be able to write a prescription just like we do for any other service,” she said.

Cook County Health’s partnership with the CHH is just one of many examples underscoring the growing need for collaboration to achieve value-based care.

Brian Spendley

“CFOs need to appreciate the impact these partnerships can have on addressing healthcare disparities and reducing the total cost of care,” said Brian Spendley, principal at Chicago-based Chartis. “That is easier to do when moving toward value and lowering the cost of care is a core strategy. CFOs must be proactive and think long-term about where the industry is headed in order to make these types of investments.”

Toepfer agreed, adding: “Health systems need to think about their role in addressing housing as a social determinant of health [SDOH]. If they don’t do this, they won’t achieve the outcomes they’re striving for.”

Focusing on preventive services through community partnerships

Mark Lodes

At Froedtert Health, headquartered in Menomonee Falls, Wisconsin, community partnerships are embedded into more than 20 different population health management programs.

“As we get deeper into our clinical care delivery model that involves addressing social determinants of health, we’re finding that the relationships we’ve established with community partners provide important connections for care delivery,” said Mark Lodes, MD, chief medical officer for population health and medical education at Froedtert. “It’s about closing preventive and wellness-based gaps for patients. When you do this, you undoubtedly decrease utilization and cost.”

Adam Smith, vice president of finance at Froedtert, agreed: “Partnerships allow us to engage patients and get them into the right population health programs, which drives better outcomes and helps from a bottom-line perspective. Better outcomes as a result of preventive and outpatient management from population health programs reduce inpatient admissions, which opens up capacity in our academic center.”

Adam Smith

For example, Froedtert recently partnered with a local colon cancer foundation to send 10,000 colon cancer screening tests by mail to eligible patients with care gaps.

“We have a large number of patients who are people of color, and we know they have lower screening rates,” Lodes said. “We also know that it’s hard for people to do the prep, take time off from work and get transportation to and from the hospital. At-home screening tests are very important for controlling the total cost of care.”

The health system’s executive director for community engagement oversees these partnerships and is always on the lookout for creative opportunities. For example, Froedtert employs a nurse who provides basic screenings and health risk assessments at a local barbershop.

“There was a lot of discussion around how one safe place for men is the barbershop,” Lodes said. “It’s about meeting people where they are. The barbershop is an important place, and when men see our presence there, it’s a winning formula.”

Building community partnerships is part of Froedtert’s emerging market strategy, Lodes said. For example, the hospital recently provided health screenings at the Hmong New Year celebration.

“Southeast Wisconsin has one of the largest Hmong populations in the country,” he said. “This population is becoming a bigger and bigger percentage of our workforce and community. Patients want a health system that understands them and is there for them. Community relationships help inform the services we provide.”

Building community partnerships through financial investments

CommonSpirit Health, a system of 138 hospitals and more than 2,000 care sites in 21 states, takes a slightly different approach by providing grants to various community organizations focused on improving health outcomes.

“We know that healthcare is about much more than acute care needs and episodes,” said Michael Bilton, system director for community health and community benefit at CommonSpirit Health. “The grant program is really intended to help build linkages between clinical care and community needs. We’re being very intentional about putting dollars into community-based organizations that are delivering services where there is a demonstrated need and some relationship to health status and well-being.”

Michael Bilton

In 2023, the health system’s Dignity Health Hospitals awarded grants totaling $6.4 million for 114 specific community-health-related projects focused on meeting patients’ and community residents’ behavioral health needs and addressing SDoH such as food access, employment and housing stability.

Community health needs assessments largely dictate the types of community organizations that ultimately receive the grant money, Bilton said. For example, St. Mary’s Medical Center uses grant money to partner with Self-Help for the Elderly, an organization that aids and supports seniors in the San Francisco area. The goal? To provide post-hospitalization transitional care for Chinese-speaking patients to reduce avoidable readmissions.

In Phoenix, St. Joseph’s Hospital and Medical Center uses grant money to partner with Mission of Mercy clinics to help patients with diabetes. This includes medical care, medication management, education and nutrition — all with the aim to improve the overall health of members of this population who are uninsured or underinsured.

Similarly, St. Bernardine Medical Center in San Bernardino, California, uses grant money to supplement a partnership with Lestonnac Free Clinic to provide services and a medical home to low-income patients after they’re discharged and to connect them to a range of community resources in an effort to reduce unnecessary ED visits. Over the past two years, this partnership has resulted in more than 300 visits to the free clinic for specialties including rheumatology, optometry and gynecology as well as nearly 20 free surgeries through Lestonnac’s partner, the Association of Los Angeles Physicians of Indian Origin. 

While these and other partnerships may not directly lower costs, they are aligned with needs identified by the community, tailored for specific populations and designed to reduce preventable hospitalizations, Bilton said.

Why are grants important?

 “To build and deepen community partnerships, we need to bring something to the table beyond simply referring patients to these organizations,” Bilton said. “We know that many of these organizations have limited resources and limited capacity.”

The grant money is only one aspect of the financial investment needed to move the needle on community partnerships, Bilton said. For example, CommonSpirit Health recently migrated to a cloud-based grant management program so it can capture and manage financial and outcomes data more easily. The health system is also investing in new referral technologies and a social needs analytics database so it can exchange data with community organizations and leverage that data for analytics purposes.

Leveraging employees to identify partnership opportunities

At HealthPartners, a health plan and care system based in Bloomington, Minnesota, a behavioral case manager saw a growing need for mental health services in communities of color. What grew from that observation was a partnership with the Minnesota State Baptist Convention, a network of 28 African American churches, focused on reducing mental health disparities in Black communities.

“This is a circular issue that drives healthcare costs up and hurts outcomes in this population and in most populations,” said Penny Cermak, executive vice president and CFO at HealthPartners. “In this example, we partnered with African American churches to raise awareness of mental health problems and help end the stigma associated with seeking treatment.”

Penny Cermak

The more diverse an organization’s employees, the better positioned it is to engage and partner with all of its populations, Cermak said. That’s one of the reasons why HealthPartners increased employee diversity by 40% in one hospital over the past five years.

It’s all part of an effort to reduce disparities and boost access to equity-informed care and coverage.

“We’re in the Twin Cities, which had the world’s attention when George Floyd was murdered in 2020,” Cermak said. “There’s a real emphasis on driving health equity across all populations here, and the events of the past few years have only intensified that.”

Developing a sustainable method to engage communities

Panagis Galiatsatos, MD, co-director of Medicine for the Greater Good at Johns Hopkins University, agreed that community partnerships through grants and other means are important. But he also emphasized that organizations need a more sustainable approach that involves hospital-employed community health workers (CHWs).

Panagis Galiatsatos

“We need to make sure we have the right advocates out in the community mitigating or removing risk,” Galiatsatos said.

In September 2022, Johns Hopkins was awarded a $2 million, five-year grant through the Health Resources and Services Administration to recruit and train 300 CHWs and then demonstrate that peer-to-peer education improves health outcomes. Part of this effort includes screening patients for SDoH so the hospital can submit accurate data to maintain its reputation. In 2023, CMS began requiring hospitals to report patient-level data on health-related social needs. Ratings systems such as Leapfrog and U.S. News & World Report will use this data to inform consumers about healthcare quality.

In addition, Galiatsatos said physician training programs should teach physicians how to perform community engagement through grassroots movements.

“To me, this is the future of medicine,” he said. “There are so many non-biological factors that influence health, and since we’re being held accountable, we had better start making a difference.” 

4 steps to build successful community partnerships

“Partnerships between health systems and community organizations continue to grow,” said Brian Spendley, principal at Chicago-based Chartis. “Health systems have long appreciated the importance of quality and safety, but health disparities are coming into greater focus with the evolving regulatory and reimbursement environment creating increased incentives to act,” he said. “Healthcare organizations alone do not have the capabilities or resources to address health disparities and cannot shoulder the entire burden of reducing the total cost of care.”

Experts provide the following four strategies to identify, align and develop community partnership opportunities:

Identify your community partners. There are many community organizations to consider (see the list on page 36 for examples). Community health needs assessments are a good place to start in terms of identifying need. “Understand your local agencies and the work they do,” said Mark Lodes, chief medical officer at Froedtert Hospital. “What are the connections to health, wellness and social determinants?”

It’s important to lean on community advisory boards, Lodes said. “Use these boards to inform you about the agencies in the area that are making an impact.”

Healthcare organizations can also leverage internal social needs, access and experience data if they have it, Spendley said. For example, what are the high-priority, high-cost populations by ZIP code, race, ethnicity and language? What is the organization’s capacity and expertise to provide the type of comprehensive care patients need and deserve?

Enlist the right internal stakeholders. Community partnerships require dedicated leadership as well as ongoing communication and collaboration. This often requires participation across a wide variety of stakeholders, including the C-suite as well as clinicians, the patient and family advisory council, patient experience officer, patient services lead and other community members.

Engage the right programmatic and funding partners. Health-system-led cross-sector partnerships can range from informal or loosely affiliated arrangements to more formalized collaborations with financial investment on the part of the health system. Priority should be given to organizations with the most potential for impact given the time and effort required to maintain strong relationships.

Carefully select key performance indicators (KPI) to measure success. Targeted KPIs can help organizations understand the impact (financial or otherwise) of their efforts. Examples of KPIs include:

  • Access to primary care or a medical home
  • Key preventive health measures (e.g., diabetes- and hypertension-related measures)
  • Life expectancy rates
  • Patient and community experience and trust
  • Preventable ED and inpatient utilization
  • Preventable readmissions
  • Total cost of care

Exploring potential community partners

Lowering healthcare costs and improving health outcomes isn’t something health systems can do alone. Instead, CFOs should consider partnerships with one or more of the following types of organizations:

  • Advocacy and lobbying groups
  • Community-based organizations
  • Departments of public health
  • Educational institutions
  • Employers and corporations
  • Faith-based organizations
  • Federally qualified health centers
  • Foundations
  • Legal aid organizations
  • Municipal, county and state government
  • Payers
  • Technology platforms
  • Third-party conveners and coalitions


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