The events of the last two years, including the COVID-19 pandemic and social unrest, have increased awareness of the impact certain social determinants can have on people’s health. In their article, “Benefit Plan Design: Focusing on Social Determinants of Health” in the December issue of Benefits Magazine, authors Alaina Melena and Rachael McCann describe social determinants of health (SDoH) as well as the role that health plan sponsors can play in addressing them.

Melena is director of health and benefits and DEI for WTW in Minneapolis, Minnesota, and McCann is health and benefit DEI leader for WTW in Philadelphia, Pennsylvania.

The article answers the following questions about SDoH and offers steps for plan sponsors to take.

What are SDoH?

According to the World Health Organization, social determinants of health (SDoH) are the nonmedical factors that influence health outcomes. They include education, financial stability, social support and equality, the environment in which people live, and access to health care.

Why are they important?

Melena and McCann point out that the pandemic, social unrest, economic loss and severe weather over the last two years have helped illustrate how SDoH can lead to disparate outcomes for different populations. For example, the COVID-19-related death rate among Hispanic or Latino and Black or African-American people is double or more than double the rate of white people in the United States. Lower income people in the U.S. have a greater risk of housing insecurity and are more likely to be homeless or living in neighborhoods more susceptible to climate shocks due to substandard infrastructure in affordable housing units and low-income communities. This places them at greater risk of poor health and premature death.

What should health and welfare plan sponsors know about SDoH?

The authors explain that health plan sponsors can influence SDoH by providing health and financial security through fair and equitable hiring practices, compensation and career development, an inclusive work culture, and affordable benefits that include advocacy and navigation support. “When employers do not act to address these factors, they may lose the ability to enhance worker health and ultimately risk unfavorable impacts to employee productivity and business results,” they write.

How can plan sponsors address SDoH?

Melena and McCann offer five steps for developing a strategy to address SDoH. They say following these steps has the potential to improve health and wealth outcomes of employees and ultimately benefit the organization.

  1. Understand employees. This involves gathering data such as where workers live, demographic information such as ethnicity and gender identification, and job roles and income.
  2. Use benefit program data to prioritize interventions. For example, a benefit plan could use human resources (HR) data to find signs of financial stress (hardship withdrawals, 401(k) opt-outs) and prioritize developing programs that would benefit those employees.
  3. Review affordability and access to health, welfare and broader employee benefits. A logical first step is to evaluate the affordability of health coverage and broader benefits such as disability and retirement savings relative to income, incorporating payroll deductions and out-of-pocket costs. Employers could address health care affordability for example by supporting health education/literacy or improving access to high-value services at a lower cost-sharing amounts. Other options include offering financial education and counseling, voluntary benefits such as hospital indemnity and critical illness insurance, and caregiving and disability leave programs for income protection.
  4. Collaborate with diversity, equity and inclusion (DEI) and talent functions within the organization. “Employers will have the greatest impact on SDoH through a focus on equitable total rewards where benefits, talent and DEI functions collaboratively place employee well-being at the center of business priorities,” Melena and McCann write.
  5. Develop a strategy to address challenges with defined target success outcomes. Employers should consider what they are trying to achieve. Examples might include attracting and retaining top talent, improving access to care or creating a better member experience.

“Benefit plan sponsors play an important role providing health and financial security to members through benefit programs,” Melena and McCann conclude. “By following these five actions to address SDoH, employers and plan sponsors will have a greater impact, creating value and custom pathways to better outcomes for populations that most need added security and support.”

Kathy Bergstrom, CEBS
Senior Editor, Publications at the International Foundation of Employee Benefit Plans

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Kathy Bergstrom, CEBS

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