6 May 2021
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How to position health equity as a long-term value driver

By Yele Aluko MD, MBA

EY Americas Chief Medical Officer

Proven MD/MBA physician executive and corporate leader with astute clinical and business healthcare industry expertise and insight.

6 May 2021

Key trends and themes that provide insight into how organizations can position health equity as a long-term value driver for their business.

In brief:

  • Defining Health Equity
  • Understanding who is at risk for health equity
  • Evaluating the economic impact of health equity

Amid the global COVID-19 pandemic, the ensuing economic crisis and our ongoing national dialogue around racial justice, an enormous paradigm shift is happening — not just within the health industry, but also in the business world. Health care leaders are wisely re-evaluating strategies and operations after the events of 2020, in many cases significantly retooling long-held protocols and points of view. Business leaders are revisiting their environmental, social and governance (ESG) obligations, and are seeking to understand how they, too, can invest in partnerships and initiatives that objectively promote health equity. As they do so, it’s important that they understand and are aligned with the systemic drivers of health disparities that result in health inequity.

Defining health equity

According to the Centers for Disease Control and Prevention (CDC), “health equity is achieved when every person has the opportunity to ‘attain his or her full health potential’ and no one is ‘disadvantaged from achieving this potential because of social position or other socially determined circumstances.’”¹ These circumstances, referred to as social determinants of health, are influenced by certain systemic drivers, and the social and physical environments in which people live, learn, work and play, affecting a range of health risks and outcomes (see Figure 1).

EY - Social determinants of health

Understanding who is at risk for health inequity

Vulnerable populations (e.g., underrepresented minorities, rural communities, the elderly, people with diverse abilities, homeless populations and the LGBT+ community) are more likely to experience certain structural drivers and community conditions,² such as housing, food and/or transportation insecurity; adverse or traumatic life experiences; risky behaviors; and systemic institutional bias, creating an increased risk for disease vulnerability and severity, reduced average life expectancy, and much more (see Figure 2). Additionally, inefficient and disparate care experienced by vulnerable populations within health systems that have committed to providing equitable quality care for all further exacerbates health inequity (see Figure 3).

EY - Health Inequities
EY - Structural drivers and community conditions that that affect health equity

These inequities have been particularly evident and publicly exposed during the pandemic, with Black, Latinx and Indigenous communities representing a disproportionate number of COVID-19 deaths (see Figure 4)³. It is critically important to understand that this insight on health disparities and its societal manifestations is not new. However, there is a growing consensus in today’s society around the idea of a moral imperative to advance social justice and eliminate health disparities in the US.

Rate ratios compared to White, Non-Hispanic persons American Indian or Alaska Native, Non-Hispanic persons Asian, Non-Hispanic persons Black or African American, Non-Hispanic persons Hispanic or Latino persons
Cases 1.9x 0.7x 1.1x 1.3x
Hospitalization 3.7x 1.1x 2.9x 3.2x
Death 2.4x 1.0x 1.9x 2.3x

Source: "Risk for COVID-19 infection, Hospitalization and Death by Race/Ethnicity". CDC Website, accessed 24 February 2021.

Figure 4: Risk for COVID-19 infection, Hospitalization and Death by Race/Ethnicity

Evaluating the economic impact of health inequity

The high costs of care delivery for vulnerable populations have far-reaching financial implications for the overall US economy. By one estimate, eliminating health care disparities would yield “a potential economic gain of $135 billion per year […] including $93 billion in excess medical care costs and $42 billion in untapped productivity” (see Figure 5).

As health care consumers across the socioeconomic spectrum navigate the complex network of health system stakeholders, vulnerable populations experience disproportionate challenges and care gaps around access, utilization and care coordination. These gaps routinely proliferate into delayed diagnoses, and many other drivers that produce predictable outcomes of health inequity. Additionally, inefficient care coordination results in excessive resource utilization from unwarranted emergency room visits and hospitalizations and much more, all combining to exponentially increase the cost of care delivery within this demographic.

One leading approach to combat health inequity is to develop a renewed focus on diversity, equity and inclusion viewed through a workforce equity and workforce resiliency lens. This awareness enables the business benefits that come with embracing diversity throughout the organization (see Figure 6) with the goal of promoting overall workforce equity. Workforce equity, in turn, enables health equity by imprinting cultural competency in an organization’s DNA such that business models of care delivery are specifically redesigned to eliminate health disparities while achieving the associated financial returns.

EY - How D&I strategies can help drive performance

This is key because health equity delivery within health systems, however, requires additional core competencies specific to the physician and clinician enterprise. This includes aligning clinician leadership with the health equity imperative; utilizing data analytics platforms that provide transparency in performance along agreed-upon health equity metrics; and leveraging governance models that foster accountability and compliance.

Moral and public health imperatives notwithstanding, these potential economic gains associated with the elimination of health disparities reveal a compelling long-term value proposition that business leaders should consider. 

The business case for achieving health equity

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While health equity hasn’t traditionally been on the board agenda, due to several recent events, boards and C-suite executives across many sectors are beginning to understand that pursuing health equity is not only the right thing to do — it also helps drive long-term business value.

Much as the recent focus on ESG matters has revealed new paths to value creation, prioritizing health equity strategies enables tremendous growth, both financial and nonfinancial. When organizations develop strategies to purposefully unlock the consumer, human and societal drivers of business value, they are better equipped to drive increased market share and both top- and bottom-line revenue (see Figure 7).

Health equity flow chart

Positioning health equity as a long-term value driver

  1. Develop a deeper understanding of the systemic factors external to the health industry, as well as the entrenched factors within the industry that contribute to health disparities.
  2. Understand where your organization can be impactful by dismantling barriers to equitable care within your control among your stakeholder group.
  3. Establish an organizational health equity strategy customized to your stakeholder group and bring the full weight of the board and executive leadership behind the goal of achieving health equity.
  4. Re-engineer and customize your business models leveraging a framework that eliminates health disparities in a manner that drives financial value to the business. 
  5. Leverage fresh thinking around your organization’s political and social impact contributions by supporting alliances that are more likely to influence policies that facilitate health equity.
  • Show article references

    "About Social Determinants of Health (SDOH)," CDC website, accessed 3 March 2021.

    ² “Populations and Vulnerabilities,” Centers for Disease Control and Prevention website, accessed 8 March 2021.

    ³ “The Color of Coronavirus: COVID-19 Deaths by Race and Ethnicity in the US.,” American Public Media Research Lab website, accessed 7 March 2021.

    ⁴ “To end the pandemic, every business leader must put worker health and equity first,” Fortune website, accessed 11 March 2021.

    ⁵ “The Business Case For Racial Equity: A Strategy For Growth,” Altarum Institute website, accessed 7 March 2021.

    ⁶ “Lessons from HealthPASS and Oxford Health Plans,” National Academies Press website, accessed 15 March 2021.

    ⁷ “To end the pandemic, every business leader must put worker health and equity first,” Fortune website, accessed 11 March 2021.

    ⁸ “To end the pandemic, every business leader must put worker health and equity first,” Fortune website, accessed 11 March 2021.

Summary

The COVID-19 pandemic has shown that health equity is an urgent imperative across the working world. While the challenges around developing industry competencies to deliver health equity are complex, implementing organizational strategies to do so will position industry players with an actionable path forward to begin to move the needle in the near term, and help effect real change in the long term.

About this article

By Yele Aluko MD, MBA

EY Americas Chief Medical Officer

Proven MD/MBA physician executive and corporate leader with astute clinical and business healthcare industry expertise and insight.