With health care providers taking on added patient risk, more attention is being paid to how well reimbursement is adjusted to account for the riskiness of a patient or a patient population.
The reimbursement for patient risk will only be as accurate as the gauges of risk being used, and some say current benchmarks are due for a change, starting with those used by Medicare Advantage. Researchers for the Dartmouth Atlas Project examined Medicare's approach to scoring patient risk for Medicare Advantage and found it to be "flawed."
The purpose of adjusting for risk in Medicare Advantage is to not give plans an incentive to avoid sicker patients or seek out only healthier ones, said David Wennberg, M.D., lead author of the study, adjunct associate professor at the Dartmouth Institute and CEO of Northern New England Accountable Care Collaborative. "If the goal of risk adjustment is to address differences in illness of the patient population, there should be some association between the score and an unambiguous measure of the population's health."
The researchers decided on using mortality rate as the unambiguous measure in its study, and found that Medicare Advantage's approach explained less than 5 percent of the variation between regions. Meanwhile, an index using five population health gauges explained 60 percent of the variation, according to the study. Two other approaches were tested and each outperformed Medicare's approach.
The inefficiency of risk adjustment has spawned a cottage industry for consultants who advise on how to try to maximize revenue from the process. Wennberg said the study's results also have implications for care in the general Medicare program, because many of the new value-oriented models being adopted or tested use a similar risk-adjustment process.
In a recognition of the growing interest in risk-adjustment, the standard-setting National Quality Forum decided to address the issue of whether it should consider other factors — mainly socioeconomic ones — in its endorsement process. An expert panel in April closed the comment period on the process and expects to reach a decision early this summer, said Helen Burstin, M.D., senior vice president for performance measures at the NQF. If the idea gets the go-ahead, measure developers would have to go through the process of deciding whether a particular measure needs reevaluation.
Jeff Goldman, vice president for coverage policy at the American Hospital Association, says the NQF's decision to reevaluate its treatment of risk adjustment sounds appropriate. "I think they're going down a very logical pathway."