Updating the Chronic Illness and Disability Payment System.

Area of Science:

• Health Services Research
• Health Economics
• Public Health Policy

Background:

• The Chronic Illness and Disability Payment System (CDPS) is utilized by 33 of 38 state Medicaid programs for risk adjustment.
• There is growing interest in integrating social determinants of health (SDH) into healthcare risk-adjustment models.

Purpose of the Study:

• To update CDPS models with recent International Classification of Diseases version 10 (ICD-10) coded data from Medicaid managed care organizations (MCOs).
• To investigate the predictive power of SDH indicators on healthcare expenditures within Medicaid populations.

Main Methods:

• Utilized health care eligibility and claims records from 1.4 million disabled beneficiaries, 9.2 million children, and 6.4 million adults across 8 states (2017-2019).
• Updated CDPS models using ICD-10 codes and assessed the relationship between healthcare spending and the Social Deprivation Index (SDI).

Main Results:

• The revised CDPS model includes 52 categories within 19 major groups, with significant revisions in six major categories (Psychiatric, Pulmonary, Renal, Cancer, Infectious Disease, Hematological).
• No statistically significant relationship was identified between healthcare spending and the Social Deprivation Index.

Conclusions:

• Revised CDPS models incorporate updated ICD-10 coding and current managed care practices.
• States should explore alternative payment strategies to effectively address health disparities and improve health outcomes.