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Financing Mechanisms for Reducing Adversity and Enhancing Resilience Through Implementation of Primary Prevention

      Abstract

      The experience of adversity and toxic stress in childhood is associated with the development of chronic health and behavioral health problems. These problems contribute substantially to health care expenditures and the overall burden of disease. Although a strong scientific literature documents the effectiveness of primary prevention in reducing childhood adversity, promoting well-being and lessening the incidence of negative outcomes, funding for these interventions is highly fragmented across multiple government agencies as well as private and philanthropic sectors. It is becoming increasingly clear that improving population health will require a concentrated public health effort to improve access to and the accountability of these interventions as well as the development of novel financing schemes. In this perspective we review existing financing mechanisms for funding interventions known to reduce adverse childhood experiences and discuss innovative financing approaches that use insurance as well as pay-for-success funding mechanisms. The latter require that cost savings associated with primary prevention be quantified and that these savings be used to offset program costs, sometimes with a return on investment for private investors. We provide a series of recommendations regarding better coordination and strategic oversight of existing resources as well as the need to further develop and validate methodologies for estimating the societal costs and benefits associated with the varying social policies that are designed to ameliorate the effects of adversity and to build resilience.

      Keywords

      Current health delivery system reform efforts aim to address root causes of the major drivers of chronic illness, disability, and health care expenditures. The burden of chronic disease, including mental health and substance use conditions (referred to as behavioral health disorders), has increased emphasis on preserving and strengthening population health. Because of the well documented, long-term effects on the prevalence of chronic diseases associated with adverse childhood experiences (ACEs),
      • Felitti V.J.
      • Anda R.F.
      The relationship of adverse childhood experiences to adult medical disease, psychiatric disorders, and sexual behavior: implications for healthcare.
      reducing exposure to adversity and enhancing protective factors will lessen this burden and strengthen population health. Fortunately there are several primary prevention interventions that have been shown to reduce the incidence and mitigate the effects of ACEs, as well as to provide long-term benefits for mental, emotional, and behavioral health.
      • Mendelson T.
      • Pas E.
      • Leis J.
      • et al.
      The logic and practice of the prevention of mental disorders.
      Currently underfinanced, these interventions have the potential to prevent the occurrence of ACEs (eg, parenting interventions that reduce rates of abuse
      • Olds D.L.
      The nurse family partnership: an evidence-based preventive intervention.
      ) as well as mitigate the effects of ACEs (eg, provide children with self-regulation skills to help cope with parental divorce
      • Velez C.E.
      • Wolchik S.A.
      • Tein J.
      • et al.
      Protecting children from the consequences of divorce: a longitudinal study of the effects of parenting on children's coping processes.
      ), leading to improved behavioral health. In this report we concentrate on challenges and opportunities in financing primary prevention interventions including universal (population-wide), selective (for those at risk), and indicated (for individuals with signs and symptoms) as well as some secondary prevention (treatment) interventions, which address ACEs and improve behavioral health.
      In this article we will briefly outline the existing array of funding that support these interventions to reduce and mitigate ACEs and highlight emerging financing trends that might be used to increase investment in efforts to reduce ACEs and promote population health.

      Current Landscape

      Since the 2009 Institute of Medicine report,
      • O'Connell M.E.
      • Boat T.
      • Warner K.E.
      Preventing Mental, Emotional, and Behavioral Disorders Among Young People: Progress and Possibilities.
      primary prevention of mental, emotional, and behavioral disorders has gained traction in public discourse. In 2011, the Substance Abuse and Mental Health Services Administration made the prevention of substance abuse and mental illness its first priority
      and has prioritized trauma reduction and trauma-informed care as a related strategic priority. The Affordable Care Act prioritized prevention as a reform strategy in addition to its goal of universal insurance coverage.
      Public Law 111-148
      The patient protection and affordable care act.
      Unfortunately, health care financing in the United States traditionally has not prioritized health promotion and illness prevention. The 2014 Centers for Medicare and Medicaid Services (CMS) summary of health expenditures reported only 3% of health spending was on public health.

      The nation's health dollar ($3.0 trillion), calendar year 2014, where it went. Available at: https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/Downloads/PieChartSourcesExpenditures2014.pdf. Accessed May 7, 2017.

      Compounding this meager investment, the fragmented public funding and administration of primary prevention addressing ACEs led to differences in language/terminology, financing sources, policy/administrative structures, delivery systems and settings, data systems, and desired outcomes. For example, although mental health and substance use systems are seeking improvements in mental health and reductions in substance abuse, education systems are concerned with outcomes related to academic achievement. ACEs are common risk factors undermining problems in each of these sectors and desired outcomes for both of these systems might be achieved by reducing ACEs through primary prevention interventions focused on strengthening families, schools, and communities. Unfortunately, the 2 systems do not often consider their converging goals and work together to achieve them. Additionally, categorical funding structures make it difficult to track outcomes and appropriately allocate cost savings to sectors. Reducing ACEs might result in reductions in special education, juvenile justice, and/or child welfare expenditures, but documenting societal savings and reinvesting them into ACEs prevention rarely occurs. Therefore, collaboration between sectors, alignment of incentives, development and evaluation of sustainable interventions, and reinvestment of system savings to support prevention of ACEs could be high-leverage strategies to mitigate the risk factors associated with ACEs, and enhance well-being at all levels. This paper details the range of traditional and innovative funding mechanisms to support preventive interventions that reduce the incidence or mitigate the effect of ACEs.

      Traditional Financing Mechanisms

      Funding for primary prevention has historically come from federal discretionary and block grants, state and local revenue, and foundations.

      Federal Block Grants

      The federal government provides block grants to states in many different human services sectors that can be used to reduce ACEs incidence and effects. The block grant funding identified in the Table summarizes some federal investment. Many of these interventions have direct relevance to reducing adversity (eg, abuse and neglect, violence reduction) and others target known outcomes of ACEs (eg, increased use of elicit substances, antisocial behavior). Funding spans several federal agencies and outcome areas, showing the challenge of aligning and coordinating federal investment in prevention.
      TableFederal Block Grant Mechanisms
      Grant MechanismDescription
      Substance Abuse Prevention and Treatment Block Grant (SAMHSA)States are required to spend at least 20% of total Block Grant funds for substance abuse primary prevention activities
      Drug Free Communities Support Program (ONDCP/SAMHSA)Provides funding to community coalitions to prevent and reduce youth substance use
      Title V - Maternal and Child Health Block Grants (HRSA)Encompasses infrastructure, population-based, and direct services for the entire maternal and child health population
      Child Care and Development Fund (ACF)Provides support for children of working parents to find and pay for nurturing child care programs
      Maternal, Infant, and Early Childhood Home Visiting (HRSA)Provides financing for home visitation to improve health, development, and related social outcomes. Interventions reduce abuse and neglect
      Child Abuse Prevention and Treatment Act (ACF)Supports prevention, assessment, investigation, prosecution, and treatment activities related to child maltreatment
      Title IV-B - Promoting Safe and Stable Families (ACF)Strengthens families to prevent child abuse and neglect and provides services for children in foster care
      Temporary Assistance to Needy Families (ACF)Provides cash assistance and employment support to low-income families. Can be used to expand childcare subsidies
      Social Services Block Grants (ACF)Funds locally relevant social services, including prevention/intervention programs
      Community-Based Family Resource and Support Grants (ACF)Supports coordination of resources and activities to reduce the likelihood of child abuse and neglect
      Community Services Block Grant (ACF)Provides funds to alleviate the causes and condition of poverty
      Injury Prevention and Control (CDC)Core Violence and Injury Prevention Program - funds to collect and use injury data

      National Violent Death Reporting System - assists states in tailoring violence prevention efforts

      Rape Prevention and Education Program - sexual violence prevention

      Domestic Violence Prevention Enhancement and Leadership through Alliances - addresses interpersonal violence
      Preventive Health and Health Services Block Grant (CDC/PPHF)Supports activities related to Healthy People 2020 objectives, including those related to violence prevention, employer-sponsored health promotion, MH and SU community-based prevention programs, LGBT health, social determinants of health, and older adult health promotion
      Title III-D - Disease Prevention and Health Promotion Services (AoA)Provides support for activities that promote healthy behaviors among older adults. Includes MH and SU prevention
      Evidence-Based Disease and Disability Prevention Program (AoA)Funds evidence-based programs to prevent disease and disability, including depression and SU
      Even Start (ED)Family literacy projects for low income families, including early childhood education and parenting education
      Title I Part A - Improving the Academic Achievement of the Disadvantaged (ED)Funds to improve academic achievement in high need, high poverty areas. Includes parent involvement activities
      Juvenile Justice Accountability Block Grants Program (OJJDP)Provides programs for youth in the justice system, as well as school safety, needs assessments, and screening activities
      Community Development Block Grant (HUD)Ensures affordable housing, provides services and economic opportunities for vulnerable communities
      ACF indicates Administration for Children and Families; AoA, Administration on Aging; CDC, US Centers for Disease Control and Prevention; ED, Department of Education; HRSA, Health Resources and Services Administration; HUD, Housing and Urban Development; LGBT, lesbian, gay, bisexual, transgender; MH, mental health; OJJDP, Office of Juvenile Justice and Delinquency Prevention; ONDCP, Office of National Drug Control Policy; PPHF, Prevention and Public Health Fund; SAMHSA, Substance Abuse and Mental Health Services Administration; and SU, substance use.

      Taxing Authority

      Excise taxes are federal, state, or local taxes levied on alcohol, tobacco, gambling, and marijuana that generate funds to reduce problems associated with these activities/substances and/or to accomplish other public good.
      • Elder R.W.
      • Lawrence B.
      • Ferguson A.
      • et al.
      The effectiveness of tax policy interventions for reducing excessive alcohol consumption and related harms.
      State and local tax levies also can fund prevention efforts through property, sales, or income taxes with funding dedicated to targeted prevention/promotion activities. For example, in 1990, Seattle voters approved a 23-cent tax on each $1000 in property value to be used for children's services. Among other investments, funds have been used to provide nurturing preschool environments for children from low-income families with the hope of improving outcomes for children who are at increased risk of ACEs.

      Seattle. gov. Department of Education and Early Learning. About the Families and Education Levy. Available at: http://www.seattle.gov/office-for-education/about-the-levy. Accessed May 7, 2017.

      Foundations

      Foundations are major sources of public health funding and critical state and community implementation partners. In particular, health conversion foundations are major funders of primary prevention in many communities.
      Grant Makers Health
      A Profile of Foundations Created From Health Care Conversions.
      Federal law requires the sale proceeds from nonprofit health systems to be used for charitable purposes such as the creation of foundations dedicated to improving population health.
      Grant Makers Health
      A Profile of Foundations Created From Health Care Conversions.
      The Colorado Health Foundation has funded Invest in Kids, a purveyor of Incredible Years, an evidence-based preventive program that includes parenting interventions to reduce the likelihood of abuse-related ACEs and improve outcomes for children who have experienced adversity.

      Emerging Financing Incentives and Mechanisms

      The health care system is changing in many important ways, including innovative financing mechanisms that support interventions to reduce and mitigate ACEs. Some are new government programs and incentives whereas others leverage private investment for public good.

      Insurance Mechanisms

      Insurance models have historically focused on individual beneficiaries and medically necessary care, which is a barrier to providing a service to an entire family, classroom, or community. However, with a move toward universal coverage and elimination of preexisting condition exclusions, insurers have greater incentives to promote population health because they are at risk for enrollment of any beneficiary from their service area.
      As a small state moving toward universal insurance coverage, Vermont exemplifies the incentives for a population focus. To improve quality and access and reduce costs, Vermont insurers pay a per-member per-month fee that is pooled to finance community health teams (CHTs) that work independently of any insurer to link residents with primary care, regardless of their insurance status. CHTs have flexibility to identify individuals in various settings (eg, homeless shelters, emergency departments) and address their needs regardless of traditional medical necessity criteria.
      Vermont Department of Health
      Vermont Blueprint for Health.
      In 2015, CHTs were legislatively encouraged to address ACEs and overall wellness. Vermont hopes to use CHTs in collaboration with new service, payment, and planning mechanisms to support community-driven solutions to ACEs and other determinants of population health. The CHT model shows that as insurance coverage approaches universal, insurers have increased incentive to provide population-based (rather than beneficiary-based) services.

      Per Capita, Risk-Based Financing

      Although fee for service reimbursement incentivizes plans to maximize service volume, a capitated plan might provide incentives for providers to promote beneficiaries' health. This is particularly true when plans are accountable for population health indicators. With capitated/at-risk payment, providing group preventive interventions or investing in community resources to improve population health (eg, playgrounds) might make business sense.
      Oregon, for example, has obtained a waiver from CMS to develop community-based Coordinated Care Organizations (CCOs) with the aim of reducing Medicaid costs by 2%. CCOs, a form of Accountable Care Organization, are a network of providers that work together under 1 geographically-based insurer to cover the Medicaid population.
      In Lane County, the CCO identified 5 public health goals, including preventing and reducing substance abuse and mental illness. The CCO provides $1.33 per-member per-month for primary prevention activities. The prevention funds are providing parenting education classes in low-income communities, including the evidence-based Department of Health and Human Services Family Check-Up and Triple P, to improve parent-child relationships and reduce the likelihood of abuse-related ACEs.
      Oregon Health Authority
      Coordinated Care Organizations and Public Health Authorities in Collaboration.
      Lane County Public Health Department is also using some of the funding to implement the Good Behavior Game (GBG)

      PAX Good Behavior Game. Available at: http://goodbehaviorgame.org. Accessed May 7, 2017.

      in schools with high Medicaid penetration. Fourteen of the 16 area school districts have trained 215 elementary school teachers in the GBG with the goal of reducing future tobacco use—a known outcome of the GBG and consequence of ACEs. The GBG makes fiscal sense in long-term health benefits to their covered population, especially for children who have experienced ACEs and are at risk for health, behavioral health, and educational problems (Webster J, personal communication, 2014).
      • Biglan A.
      • Lichtenstein E.
      • Webster J.
      This represents a Medicaid-funded primary prevention intervention that is not restricted to Medicaid beneficiaries—an important innovation in the use of insurance funds.

      Community Benefit Requirements

      As insurance coverage has expanded, fewer uninsured individuals seek charity care at hospitals. Freed from some uncompensated care, current law requires that nonprofit hospitals use some of these available resources to assess community health needs and implement a plan to meet these needs. Many nonprofit hospitals have identified social determinants of health—including many associated with ACEs (eg, poverty, inadequate housing)—as community needs and drivers of health care costs that can be addressed through primary prevention interventions in the community (eg, school-based programs, community-based organizations).

      CMS Incentives

      Under the Obama administration, CMS had an expanding role in providing health insurance to a broad population of individuals. Novel Medicaid reimbursement methods and waivers were tested to fund interventions to reduce ACEs.
      Washington State is implementing Triple P, a prevention intervention, in clinical pediatric settings. A select group of providers was trained to deliver brief consultations to parents regarding the antecedents of ACEs including parenting, child development, and behavior problems.

      Triple P. Available at: http://www.triplep.net. Accessed May 7, 2017.

      Although Medicaid funds do not support the universal component of Triple P, this use of Medicaid for parenting support broadens interventions from individuals to families to improve parenting competencies and reduce the likelihood of harsh punishment and abuse.
      A component of New York State's 1115 Medicaid waiver, the Delivery System Reform Incentive Payment

      New York State Department of Health. Delivery System Reform Incentive Payment (DSRIP) Program. Available at: https://www.health.ny.gov/health_care/medicaid/redesign/delivery_system_reform_incentive_payment_program.htm. Accessed May 7, 2017.

      includes explicit reference to population-based prevention services and a population focus. For example, the Nurse Family Partnership, an intervention known to prevent emotional and physical abuse, is identified as a perinatal intervention for inclusion in Medicaid plans. This waiver might indicate an important change in Medicaid where cost containment is realized through improving population health by reducing exposure to adversity.

      Pay-for-Success Contracts/Business Investment in Prevention

      Because of the growing evidence of the effectiveness and cost savings that can be realized by preventive programming,
      Washington State Institute for Public Policy
      Benefit-Cost Results.
      there is new interest in funding arrangements that use cost savings from successful interventions to repay investors. These arrangements rely on rigorous evaluation to assure that program objectives are realized and engage diverse funders—private as well as philanthropic. This mechanism has the possibility of providing an influx of funding for improving health and social outcomes that would be anticipated from the reduction of ACEs.
      Social Impact Bonds (SIBs) are pay-for-success contracts that rely on a private investor to provide funding for the implementation of a program that has shown outcomes and cost-effectiveness. A rigorous program evaluation is used to assess cost savings, and, if anticipated cost savings are realized, they are used to repay the initial investment with interest. In some instances, the government or foundations guarantee part of the SIB, reducing risk to investors. SIBs shift financial risk for a program's success from the government to an investor.
      Most SIB models are dependent on savings to the government sector that engages in the contract with investors. However, many interventions that prevent or mitigate the effects of ACEs have been shown to have effects in multiple sectors (eg, Nurse Family Partnership affects behavioral health, general health, child welfare, education, future criminal justice, etc). The effect on multiple sectors and multiple budgets might or might not be captured. In this regard, the work of the Washington State Institute on Public Policy (WSIPP) contributes to understanding the broad-scale effect of interventions on the population and global budget. As a resource for the state legislature, WSIPP has developed rigorous cost/benefit methodology that monetizes the overall societal benefit of preventive interventions. WSIPP's analysis resulted in 2000 prison beds being removed from the capital construction budget, reallocating funds to programming shown to reduce criminal justice involvement,
      Washington State Institute for Public Policy
      Evidence-Based Public Policy Options to Reduce Future Prison Construction, Criminal Justice Costs, and Crime Rates.
      • Drake E.K.
      Reducing crime and criminal justice costs: Washington state's evolving research approach.
      another ACE. Sophisticated cost/benefit models enable states and other payers to understand the results of their investments in reduction of ACEs to redirect funds and repay investors.

      Policy and Scientific Recommendations

      The fragmentation of funding across multiple levels of government as well as the private and public sectors frustrates a coordinated approach to implementing primary prevention to reduce ACEs. New focus on population health and greater acknowledgement of the antecedent conditions (eg, ACEs) of disease and disability suggest the need for further policy and scientific innovation. Six specific recommendations are as follows.
      • 1.
        A coordinating entity should be created in the federal government or the National Academy of Medicine to create a conceptual framework to understand and account for outcomes across the broad range of public and private investment. This entity could develop standardized evaluation frameworks that identify important measures of adversity and resilience and to monitor them systematically.
      • 2.
        Developing and validating metrics to estimate societal costs and benefits for preventive and treatment interventions is essential. These must be comprehensive, including proximal and long-term costs and benefits of alternative social policies. Metrics should include routinely collected data (eg, health care expenditures, corrections, social welfare, labor participation, income/tax payments) and special national surveys.
      • 3.
        An integrated global budget that combines health and social welfare funding and that is cognizant of the distributed benefits and costs across funding sectors would be optimal. This approach to funding will best support reduction of ACEs and promote the integration and coordination necessary to achieve the promise of prevention/promotion science.
      • 4.
        Systematic dissemination of innovative public policies like those in Oregon, Washington, and New York that prove effective is essential for advancing this public health agenda.
      • 5.
        Rigorous program evaluations should be a routine expectation for community-based programming or policy initiatives to assure quality, understand local adaptation, and continuously improve programs.
      • 6.
        Evaluation of innovative financing mechanisms should be prioritized by government and philanthropic sources. Pooling tariffs from existing insurance programs, like those used in Vermont, and pay-for-success financing mechanisms seem particularly attractive for study.

      Summary

      It appears that the 2016 national elections will introduce change in the American health care system. Ongoing congressional concern with controlling health care costs is an opportunity to support primary prevention of ACEs, because of their known effects on overall health and social outcomes. It is our hope that the compelling science underlying the role of ACEs in the development of chronic health problems as well as the continuing concern for population health will support the financing of upstream programming. Additionally, to the degree to which some popular features of the Affordable Care Act, such as the prohibition of exclusion on the basis of preexisting conditions, as well as delivery structures like Accountable Care Organizations and risk-based capitated systems, will preserve incentives to help assure population health regardless of the specific strategies adopted by the new administration and Congress.
      The evolving realization that investment in prevention results in savings to government has introduced novel private financing strategies for established interventions with predictable outcomes. The philanthropic sector continues to be a major supporter of prevention activities and the nation's public health. New emphasis on measuring aggregate social effects and holding entities accountable for expected health outcomes will stimulate implementation and sustainability of primary prevention interventions and the subsequent reduction in ACEs.
      These emerging financing strategies move human service systems upstream to reduce disease burden and enhance well-being and productivity. By understanding the relationship between interventions, ACEs, and changes in behavioral and general health outcomes as well as overall measures of productivity, a coherent strategy can be developed to coordinate financing, maximize return on investment, and ultimately reduce ACEs and promote health.

      Acknowledgments

      This article was prepared by Sarah M. Steverman in her personal capacity. The opinions expressed are the author's own and do not reflect the view of the Substance Abuse and Mental Health Services Administration, the Department of Health and Human Services, or the United States government.
      Financial disclosure: Development of this article was supported, in part, by the Substance Abuse and Mental Health Services Administration (contract reference number HHSS28342001T).
      Publication of this article was supported by the Promoting Early and Lifelong Health: From the Challenge of Adverse Childhood Experiences (ACEs) to the Promise of Resilience and Achieving Child Wellbeing project, a partnership between the Child and Adolescent Health Measurement Initiative (CAHMI) and Academy-Health, with support from the Robert Wood Johnson Foundation (#72512).

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