Unbiased Analysis of Today's Healthcare Issues
How does Medicare measure patient case mix? For the most part, Medicare uses the Hierarchical Condition Category (HCC) model. A recent CMS presentation describes the HCC model in more detail. Today I review where CMS applies the HCC model, provide an overview of the HCC methodology, briefly describe its performance, and give some background on…
At a recent AcademyHealth presentation, Cheryl Damberg discussed her research to design a P4P program for implementation for Integrated Healthcare Association (IHA). One thing I noticed about the presentation was that smaller provider groups had patients with lower risk scores (i.e., healthier patients). Is it really the case that small providers treat much healthier patients?…
To evaluate providers based on the health outcomes or the cost of care, one must attempt to evaluate dimensions of care which are strictly within the providers control. For instance, if a physicians treats two patients with breast cancer, but one patient has a more advanced form of breast cancer, one should take this difference…
Many states rely on managed care organizations (MCOs) to provide medical services for their Medicaid beneficiaries. Contracting out medical services to private providers relies on the government’s capacity to accurately predict expected cost of care for each beneficiary. This is typically done through risk-adjusted capitation rates. Which risk adjustment strategy works best? The answer of…
Risk adjustment is important for many aspects of health care. Medicare uses risk adjustment to modify payments to Medicare Advantage (Part C) plans based on the health of the beneficiaries they cover. Private insurance companies can use risk adjustment to fine-tune capitation payments to physicians or determine a potential enrollee’s premium. Providers can use risk…
A paper by Thomas, Grazier, and Ward (2004) analyzes a variety of risk adjustment software products. Using these six risk adjustment products to calculate physician efficiency scores, they found “moderate to high levels of agreement were observed among the six risk-adjusted measures of practice efficiency.” However: “And even though our analyses suggest that 50 percent…