Health Disparities Exposed in the Light of COVID-19

Socioeconomic factors are the foundational drivers of community health and why a new economic design of healthcare is needed.

August 29, 2020

The COVID-19 pandemic has been a wake-up call for everyone, as its effects unveil systemic and structural deficiencies in nearly every aspect of society. While initially viewed as an isolated health crisis, the subsequent economic recession revealed that community health and the economy are highly interconnected and dependent upon each other. Sadly, record unemployment and lack of opportunity have devastated the livelihood and health status of many. After six months of fighting the virus, infection rates continued to rise across the United States. Boston Federal Reserve Bank President, Eric Rosengren, claims that the recent slowdown in U.S. economic activity is likely to persist because of difficulties states have encountered in suppressing the corona-virus pandemic. Mr. Rosengren expects the unemployment rate, which stood slightly above 10% in July, to be slow in declining given worsening public-health situations in states that were quick to lift lock-down orders in May. Easing restrictions prematurely “hurt both the economy and public health down the road.”1

In addition, corona-virus data continues to reveal troubling disparities among select income and racial groups. According to The COVID Racial Data Tracker, approximately 22 percent of COVID-19 deaths are among African Americans, yet they make up only 13% of the total population. 2 This disproportionate impact is similar with the Hispanic/Latino population, which is approximately 4 times more likely to be hospitalized for COVID-19 than white Americans.

These disparities can partially be explained by the fact that African Americans exhibit higher rates of hypertension, diabetes and obesity, that make defeating the virus more challenging. In addition, the virus initially hit urban areas the hardest, in which a higher proportion of black and Latino populations reside. However, it is the underlying economic, social and environmental factors that play the greatest role in explaining the data.

Our country’s history of racial injustice, beginning with slavery, continuing with Jim Crow segregation, followed by the war on drugs, leading to present day police brutality and mass incarceration, has resulted in discriminatory systems that have left African Americans at a disadvantaged starting point. With little generational wealth and limited economic opportunity or mobility, many low-income blacks do not have the economic luxury to work from home during the shutdown. Instead, many are forced to risk their lives as essential, or “front-line,” workers to keep the country running.

Life Expectancy Data Reveals Disparities

With the startling number of COVID-19 deaths, another key indicator of public health–life expectancy–is revealing many of these same health disparities. In 2017, the average life expectancy for Americans was 78.6, according to the U.S. Centers of Disease Control and Prevention (CDC).3 While this number has steadily risen for decades due to advancements in healthcare and technology, U.S. life expectancy hit a peak in 2014 and is now declining. When compared globally, the U.S. is near the bottom in global rankings at 43rd, according to the CIA’s World Factbook for developed economies.4 Citizens of other countries, like Japan (85.3) and Singapore (85.2), are out living Americans by 5 to 7 years on average.

According to the Institute for Health Metrics and Evaluation (IHME), reasons for the recent plateau of national life expectancy may be due to the lack of universal health insurance, rising obesity levels and correlating diseases, as well as higher rates of child mortality.5 Life expectancy is an important measure of a country’s overall health because it reveals both the quality of healthcare systems and the socioeconomic factors that influence living standards. The economic impact of this is astounding, as the U.S. government assigns the economic value of each year of life at $100,000 per person per year. When accounting for persons who die early, the cost of losing six years of life annually adds up to roughly $1.5 trillion.6 Essentially, about 10% of potential GDP is being left on the table due to low life expectancy.

Geographic disparities within the U.S. reinforce this reality. For example, states in the U.S., such as West Virginia (74.8) and Mississippi (74.5) have life expectancies comparable to less developed countries, like Bulgaria, Vietnam, Iraq and Syria.7 These disparities are not just found between regions of the U.S., but income inequalities in cities lead to a wide life expectancy gap in urban areas. Among many cities, Washington D.C. boasts the widest gap, meaning that rich residents live approximately 10 years longer than poor residents, even though these households may reside just a few miles apart. These findings certainly underscore how the physical environment and distribution of local amenities can impact community health.

There are also demographic disparities when looking at life expectancy data. African Americans exhibit the lowest life expectancy among racial groups, living 11 years shorter than Asian-Americans. When trying to uncover the reasons for this gap, there are many interconnected factors, but the driving force is some form of inequality. Remarkably, a Princeton University study from 2012 discovered that socioeconomic differences may account for about 80 percent of the observed life-expectancy divide between black and white American men.8 Socioeconomic factors would include indicators, such as income, educational attainment, and living conditions based on the local environment.

In recent years, many academic and community health leaders have called attention to these factors, which are commonly referred to as “Social Determinants of Health.”9 Communities across the country are now realizing that social determinants of health (SDOH) must be addressed to ensure sustainable and equitable public health.

Going forward thefocus must be on a new economic design that deploys holistic care, engages patient families and community services, and addresses the underlying social risk factors of health to ensure the long-term sustainability of U.S. healthcare organizations as well as the U.S. economy. A recent article in the Harvard Business Review 10 indicates that combining social workers within primary care practices significantly lowers costs and increases quality outcomes among the 5% of patients who are responsible for about half of all healthcare spending. Regardless of whether this awakening derived more by the failure to sustain a $3.5 Trillion asset than an intrinsic desire to value human life, a new economic design can accomplish both goals: health and economic vitality.

Economic Impact and Cost Benefit Assessment

Measuring the economic and social impacts associated with addressing SDOH is an important tool in attracting funding for such community health improvement programs. These tools can also help direct strategic investments for healthcare providers, resulting in the improved fiscal health of their organization, as well as the economic and physical health of their community. Tripp Umbach11 has used customized economic impact models since 2012 to measure how the award-winning Green Family Foundation Neighborhood HELP program at Florida International University College of Medicine impacts the bottom line of South Miami Baptist Hospital and the South Florida economy. The program has resulted in a return on investment (ROI) of $13.15 for every 1 dollar invested. In addition to measurably lowering unnecessary emergency department visits and increased participation in preventative care, the program also continues to advance economic vitality and job creation in the community.

Community Transformation Initiatives

Addressing SDOH requires working with a diverse cohort of organizations and individuals beyond healthcare: including leaders in education, government, social services, and/or economic development. Only then can communities achieve comprehensive transformation. Community Transformation Initiatives (CTI) seek to improve the physical, mental, economic, and environmental health of a community, by bringing these key players all to the table. A CTI can also act as a magnet for outside funding and drive strategic investments for communities of all sizes, resulting in the improved fiscal health of organizations engaged in the Initiative. Transformational initiatives represent a shift in strategy to achieve the economic benefits that result from working collaboratively across sectors within a diverse network of stakeholders.

Working together, communities are then able to improve vital social determinants of health – housing, education, environment, food access, social support networks, and other issues. One prominent issue is affordable housing, regarded as the “first step on a path to better health,” along with other essential needs such as transportation and food security.12 Of course, each community must identify and prioritize which of the SDOH to focus their efforts based on the unique needs of a community. This is why a comprehensive community health assessment is a valuable first step.

The spark for change is catching fire in communities big and small, in all regions of our country. Now more than ever, we need widely engaged community transformation initiatives. While federal and state change is important, what occurs in our cities, counties, and towns will have far greater impact on the health and wellbeing of Americans than the passage of federal laws. Local communities led the fight against COVID-19 and have proven throughout U.S. history to be the engine for economic, social, and quality of life improvement.

View Endnotes

  1. Fed Officials Warn Pandemic Response Is Hobbling Economic Rebound, The Wall Street Journal (Aug 12, 2020), https://www.wsj.com/articles/fed-official-warns-pandemic-response-is-hobbling-economic-rebound-11597241418
  2. The COVID Racial Data Tracker, The Atlantic, https://covidtracking.com/race (Data from State Health Department Reporting – Updated Daily)
  3. Average US Life Expectancy Statistics by Gender, Ethnicity, State. Simply Insurance, Accessed Aug 7, 2020. https://www.simplyinsurance.com/average-us-life-expectancy-statistics/#section-5
  4. Life expectancy at birth, Organization for Economic Co-operation and Development (OECD), (2019 or latest available), https://data.oecd.org/healthstat/life-expectancy-at-birth.htm
  5. How healthy will we be in 2040?, Institute for Health Metrics and Evaluation (2018), http://www.healthdata.org/news-release/how-healthy-will-we-be-2040
  6. Putting a Dollar Value on Life? Governments Already Do, The New York Times (May 11, 2020), https://www.nytimes.com/2020/05/11/upshot/virus-price-human-life.html
  7. If you’re an average American, you’ll live to be 78.6 years old, National Geographic (December 7, 2018) https://www.nationalgeographic.com/culture/2018/12/life-expectancy-united-states/#close
  8. Study reveals impact of socioeconomic factors on the racial gap in life expectancy, Princeton University (April 4, 2012), www.princeton.edu/news/2012/04/04/study-reveals-impact-socioeconomic-factors-racial-gap-life-expectancy
  9. Beyond Health Care: The Role of Social Determinants in Promoting Health and Health Equity, KFF Disparities Policy (May 10, 2018), https://www.kff.org/disparities-policy/issue-brief/beyond-health-care-the-role-of-social-determinants-in-promoting-health-and-health-equity/
  10. Managing the Most Expensive Patients, Harvard Business Review (January 2020), https://hbr.org/2020/01/managing-the-most-expensive-patients
  11. Tripp Umbach is among the most respected and experienced private consulting firms in the United States serving 1,000 clients in healthcare, academic medicine, and higher education. Over the past 30-years, Tripp Umbach has completed hundreds of community health and economic impact assessments for leading health systems and public health organizations. trippumbach.com
  12. In 2019, CVS Health Invested $67 Million in Affordable Housing, Health Leaders, February 2020: https://www.healthleadersmedia.com/clinical-care/2019-cvs-health-invested-67-million-affordable-housing

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