Evaluating alternative risk adjusters for Medicare
In this study the authors use 3 years of the Medicare Current Beneficiary Survey (MCBS) to evaluate alternative demographic, survey, and claims-based risk adjusters for Medicare capitation payment. The survey health-status models have three to four times the predictive power of the demographic models. The risk-adjustment model derived from claims diagnoses has 75-percent greater predictive power than a comprehensive survey model. No single model predicts average expenditures well for all beneficiary subgroups of interest, suggesting a combined model may be appropriate. More data are needed to obtain stable estimates of model parameters. Advantages and disadvantages of alternative risk adjusters are discussed
Pope, G., Adamache, W., Walsh, E., & Khandker, RK. (1998). Evaluating alternative risk adjusters for Medicare. Health Care Financing Review, 20(2), 109-129.