2025 SOA Health Meeting Virtual Event: Session 5C: Simplifying Risk Adjustment -07.23.25- Recording

Health care risk adjustment methodologies have become increasingly complex, largely due to the belief that complexity enhances accuracy. However, a disconnect exists between how health care risk is assessed and how payments are adjusted.
In this session, we will explore the stark difference between measuring the accuracy of a risk assessment model at a member level and that of a risk adjustment mechanism at the health plan level. I will show that a highly simplified approach that does not use diagnosis codes can have similar accuracy on risk adjusted payments to models that do.
Attendees will learn that accuracy is not a barrier to developing simpler risk adjustment methodologies, which can improve payment accuracy and reduce the financial incentive for coding diagnoses.