Assessing risk-adjustment approaches under non-random selection

Harold S. Luft, R. Adams Dudley

Research output: Contribution to journalReview articlepeer-review

6 Scopus citations

Abstract

Various approaches have been proposed to adjust for differences in enrollee risk in health plans. Because risk-selection strategies may have different effects on enrollment, we simulated three types of selection-dumping, skimming, and stinting. Concurrent diagnosis-based risk adjustment, and a hybrid using concurrent adjustment for about 8% of the cases and prospective adjustment for the rest, perform markedly better than prospective or demographic adjustments, both in terms of R2 and the extent to which plans experience unwarranted gains or losses. The simulation approach offers a valuable tool for analysts in assessing various risk-adjustment strategies under different selection situations.

Original languageEnglish (US)
Pages (from-to)203-217
Number of pages15
JournalInquiry
Volume41
Issue number2
DOIs
StatePublished - 2004
Externally publishedYes

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