Unbiased Analysis of Today's Healthcare Issues

Regional Variation in Medicare Spending and Risk Adjustment

What is the key driver of regional variation in Medicare spending? According to a paper by Reschovsky Hadley, and Romano (2013), the answer is regional variation in patient health. Two key casemix adjustment methods—controlling for patient conditions obtained from diagnoses on claims and expenditures of those at the end of life—were evaluated. We failed to […]

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Medicare Advantage Plan’s Response to Risk Adjustment

Medicare beneficiaries have the option to enroll in private plans to have them operate their benefits rather than use the tradiational Medicare Fee-for-services (FFS) program.  Medicare pays these private plans, known as Medicare Advantage (MA) plans, premiums based on the health status of their enrollees.   Medicare uses a risk score to measure beneficiary health status. […]

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Measuring Patient Case Mix in Medicare

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 […]

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The CMS HCC Model

The CMS-HCC risk adjustment model is used to adjust payments for Part C benefits offered by MA plans and Program of All-Inclusive Care for the Elderly (PACE) organizations to aged/disabled beneficiaries. The CMS-HCC model includes both diseases and demographic factors. There are separate sets of coefficients for beneficiaries in the community, beneficiaries in long term care […]

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