Risk Adjustment-Lessons Learned: Experience in VHI Markets

119 Pages·2011·0.83 MB·English

Risk Adjustment-Lessons Learned:
Experience in VHI Markets
John Armstrong (Ireland),
Erasmus University, Rotterdam
Heather McLeod,
New Zealand
Francesco Paolucci
ACERH, Canberra
Webcast
30 - 31 March 2011
Agenda
(cid:1)
Risk Equalisation/Risk Adjustment: Global Experience and Future
Relevance
(cid:1)
Risk equalisation/risk adjustment — background and definitions
[Heather]
(cid:1)
Introduction to three country study [John]
(cid:1)
Summary of Australia experience [John]
(cid:1)
Summary of Ireland experience [John]
(cid:1)
Summary of South Africa experience [Heather]
(cid:1)
Three country comparison [John]
(cid:1)
Wrap up of themes and learnings [John]
(cid:1)
Listener Submitted Questions
Part 1:
Risk equalisation/ risk
adjustment:
Background / Definitions
Webcast
30 - 31 March 2011
Information
Risk Adjustment
Used
Competitive Other Predictive
Markets Settings Modeling
(cid:1)
Demographics,
(cid:1)
Health status (e.g. diagnoses)
(cid:1)
Functional status
(cid:1)
Geography
(cid:1)
Socio-economic variables
(cid:1)
Price and insurance coverage
(cid:1)
Supply side factors
(cid:1)
Consumer Taste
(cid:1)
Lagged or concurrent utilization
Source : Adapted from Prof Randy Ellis, iHEA, Barcelona, Spain, 2005
Risk-Adjusted Capitation
(cid:1)
A capitation payment is defined as the contribution to a plan’s budget
associated with a plan member for the service in question for a given
period of time.
(cid:1)
Clearly the health care expenditure needs of citizens vary
considerably, depending on personal characteristics such as age,
morbidity, and social circumstances.
(cid:1)
More refined forms of capitation systems therefore employ methods of
risk adjustment, which seek to adjust per capita payments to reflect
the relative expected health service expenditure for plan members on
the basis of personal characteristics.
Source: Rice and Smith, 2001
Risk-Adjusted Capitation
Source: Rice and Smith, 2001
England

Population
Taxation
Government
D e p a r t m e n t o f H e a l t h
A l l o c a t i o n
R i s k e q u a l i s e d a l l o c a t i o n s
Health Health Health Health
Authority Authority Authority Authority
R i s k e q u a l i s e d a l l o c a t i o n s
Primary Care Groups
Source: Oliver Adam J, “Risk Adjusting Health Care Resource Allocations”
Source : CARE Monograph 3, Parkin and McLeod
Predictive Modeling
(cid:1)
Predictive models are used for:
(cid:1)
Care management
(cid:1)
Provider selection
(cid:1)
Provider profiling
(cid:1)
Effectiveness research
(cid:1)
Forecasting financial data
(cid:1)
Quality measurement
(cid:1)
Incentives and internal face validity may matter less than with classic
risk adjustment uses.
Source : Prof Randy Ellis, Barcelona, Spain, 2005
Hospital spend
DRG: Condition X
Apparent
Distribution of
Admission Costs Age < 17
per condition X
No C.C.
< 17 yrs without C.C. with C.C.
Detailed
Breakdown
Distribution
of Admission
Costs per
With C.C.
condition X
Individual Case Mix adjusted Breakdown
Distribution of Admission Costs per
condition X
Diagnosis-based Risk Adjustment
(cid:1)
Adjusted Clinical Groups (ACG)
(cid:1)
John Hopkins University
(cid:1)
Chronic Disability Payment System (CDPS)
(cid:1)
University of San Diego and Boston University
(cid:1)
Diagnostic Cost Groups (DCG)
(cid:1)
Boston University and Health Economics Research
(cid:1)
Global Risk Adjustment Model (GRAM)
(cid:1)
Kaiser Permanente
Not an exhaustive list !
Source : Prof Randy Ellis, iHEA, Barcelona, Spain, 2005