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dc.contributor.authorChen, Jingen_US
dc.contributor.authorEllis, Randall P.en_US
dc.contributor.authorToro, Katherine H.en_US
dc.contributor.authorAsh, Arlene S.en_US
dc.date.accessioned2019-03-21T15:30:48Z
dc.date.available2019-03-21T15:30:48Z
dc.date.issued2015-05-01
dc.identifierhttp://gateway.webofknowledge.com/gateway/Gateway.cgi?GWVersion=2&SrcApp=PARTNER_APP&SrcAuth=LinksAMR&KeyUT=WOS:000354483800001&DestLinkType=FullRecord&DestApp=ALL_WOS&UsrCustomerID=6e74115fe3da270499c3d65c9b17d654
dc.identifier.citationJing Chen, Randall P Ellis, Katherine H Toro, Arlene S Ash. 2015. "Mispricing in the Medicare Advantage Risk Adjustment Model." INQUIRY: The Journal of Health Care Organization, Provision, and Financing, Volume 52, pp. ? - ? (7). https://doi.org/10.1177/0046958015583089
dc.identifier.issn0046-9580
dc.identifier.issn1945-7243
dc.identifier.urihttps://hdl.handle.net/2144/34341
dc.description.abstractThe Centers for Medicare and Medicaid Services (CMS) implemented hierarchical condition category (HCC) models in 2004 to adjust payments to Medicare Advantage (MA) plans to reflect enrollees’ expected health care costs. We use Verisk Health’s diagnostic cost group (DxCG) Medicare models, refined “descendants” of the same HCC framework with 189 comprehensive clinical categories available to CMS in 2004, to reveal 2 mispricing errors resulting from CMS’ implementation. One comes from ignoring all diagnostic information for “new enrollees” (those with less than 12 months of prior claims). Another comes from continuing to use the simplified models that were originally adopted in response to assertions from some capitated health plans that submitting the claims-like data that facilitate richer models was too burdensome. Even the main CMS model being used in 2014 recognizes only 79 condition categories, excluding many diagnoses and merging conditions with somewhat heterogeneous costs. Omitted conditions are typically lower cost or “vague” and not easily audited from simplified data submissions. In contrast, DxCG Medicare models use a comprehensive, 394-HCC classification system. Applying both models to Medicare’s 2010-2011 fee-for-service 5% sample, we find mispricing and lower predictive accuracy for the CMS implementation. For example, in 2010, 13% of beneficiaries had at least 1 higher cost DxCG-recognized condition but no CMS-recognized condition; their 2011 actual costs averaged US$6628, almost one-third more than the CMS model prediction. As MA plans must now supply encounter data, CMS should consider using more refined and comprehensive (DxCG-like) models.en_US
dc.description.sponsorshipAsh was partially supported by NIH grants U01HL05268 and UL1TR000161. All four authors received financial support from Verisk Health for researching and writing this paper, in the form of salary support (Chen and Toro), consulting fees (Ash), and a research contract to Boston University (Ellis). (U01HL05268 - NIH; UL1TR000161 - NIH; Verisk Health)en_US
dc.languageEnglish
dc.language.isoen_US
dc.publisherSAGE Publications (UK and US)en_US
dc.relation.ispartofINQUIRY: The Journal of Health Care Organization, Provision, and Financing
dc.rightsAttribution-NonCommercial 4.0 Internationalen_US
dc.rights.urihttp://creativecommons.org/licenses/by-nc/4.0/
dc.subjectScience & technologyen_US
dc.subjectLife sciences & biomedicineen_US
dc.subjectHealth care sciences & servicesen_US
dc.subjectHealth policy & servicesen_US
dc.subjectMedicareen_US
dc.subjectCMS-HCCen_US
dc.subjectDxCGen_US
dc.subjectRisk adjustmenten_US
dc.subjectPayment modelsen_US
dc.subjectCapitation paymentsen_US
dc.subjectSystemen_US
dc.subjectCenters for Medicare and Medicaid services (U.S.)en_US
dc.subjectFee-for-service plansen_US
dc.subjectHealth care costsen_US
dc.subjectHumansen_US
dc.subjectMedicare part Cen_US
dc.subjectModels, economicen_US
dc.subjectUnited Statesen_US
dc.subjectPublic health and health servicesen_US
dc.titleMispricing in the Medicare advantage risk adjustment modelen_US
dc.typeArticleen_US
dc.description.versionPublished versionen_US
dc.description.versionPublished versionen_US
dc.identifier.doi10.1177/0046958015583089
pubs.elements-sourcemanual-entryen_US
pubs.notesEmbargo: Not knownen_US
pubs.organisational-groupBoston Universityen_US
pubs.organisational-groupBoston University, College of Arts & Sciencesen_US
pubs.organisational-groupBoston University, College of Arts & Sciences, Department of Economicsen_US
pubs.publication-statusPublisheden_US


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Except where otherwise noted, this item's license is described as Attribution-NonCommercial 4.0 International