A Framework for the Design of Risk-Adjustment Models in Health Care Provider Payment Systems

Overview

Journal Med Care Res Rev

Specialty Health Services

Date 2024 Sep 3

PMID 39225352

Authors

Andreea Panturu

Richard van Kleef

Frank Eijkenaar

Danielle Cattel

Affiliations

Soon will be listed here.

Abstract

Prospective payments for health care providers require adequate risk adjustment (RA) to address systematic variation in patients' health care needs. However, the design of RA for provider payment involves many choices and difficult trade-offs between incentives for risk selection, incentives for cost control, and feasibility. Despite a growing literature, a comprehensive framework of these choices and trade-offs is lacking. This article aims to develop such a framework. Using literature review and expert consultation, we identify key design choices for RA in the context of provider payment and subsequently categorize these choices along two dimensions: (a) the choice of risk adjusters and (b) the choice of payment weights. For each design choice, we provide an overview of options, trade-offs, and key references. By making design choices and associated trade-offs explicit, our framework facilitates customizing RA design to provider payment systems, given the objectives and other characteristics of the context of interest.

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