Description: Healthcare risk adjustment methodologies have become increasingly complex, largely due to the belief that complexity enhances accuracy. However, a disconnect exists between how healthcare risk is assessed and how payments are adjusted. This article explores 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 show that a highly simplified approach that does not use diagnosis codes can have similar accuracy on risk adjusted payments to models that do. These findings suggest 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.

Description: Risk adjustment is used to adjust the revenue stream to health insurers that sell ACA eligible plans and Medicare Advantage plans. This article compares and contrasts these risk adjustment programs.

Description: What is the difference between a Single-Payer and Universal Health Care System, and how could the U.S. implement a system that would reduce the growth of medical costs while increasing quality.