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Making risk adjustment work for everyone

R Kronick1, Z Zhou, T Dreyfus

  • 1Department of Family and Preventive Medicine, University of California, San Diego, La Jolla 92093, USA.

Inquiry : a Journal of Medical Care Organization, Provision and Financing
|January 1, 1995
PubMed
Summary
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This study shows health care spending for disabled individuals is predictable, informing better payment systems for health plans serving vulnerable populations. This research aids in rewarding plans that support people with disabilities and low-income residents.

Area of Science:

  • Health Services Research
  • Health Economics
  • Public Health Policy

Background:

  • Health plans serving vulnerable populations, including individuals with disabilities and those in low-income areas, require appropriate financial incentives.
  • Understanding healthcare expenditure patterns is crucial for developing equitable payment systems.

Purpose of the Study:

  • To explore methods for rewarding health plans that effectively serve individuals with disabilities and residents of low-income neighborhoods.
  • To analyze healthcare expenditure patterns for Medicaid-covered persons with disabilities to inform risk-adjusted payment systems.

Main Methods:

  • Analysis of healthcare expenditure data for Medicaid beneficiaries with disabilities across four states (Ohio, Missouri, Minnesota, Wisconsin).
  • Examination of the relationship between diagnostic classifications and healthcare resource utilization.

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  • Assessment of expenditure predictability for disabled versus non-disabled populations.

    • Main Results:

    • Diagnostic classifications are significantly related to healthcare resource utilization among persons with disabilities.
    • Healthcare expenditures are substantially more predictable for individuals with disabilities compared to the non-disabled population.
    • Findings suggest a basis for more accurate risk-adjusted payment models.

    Conclusions:

    • Predictability of expenditures for disabled individuals supports the development of refined risk-adjustment in payment systems.
    • Further consideration is needed for methods ensuring high-quality care in underserved urban communities.
    • The study provides insights for incentivizing health plans to better serve high-need populations.