Date
May 2011
Document Type
Poster
Description
Background
The Patient-Centered Medical Home (PCMH) requires fundamental reform of health care financing. We propose a Risk-Based Comprehensive Payment system with risk-adjusted base and bonus payments.
Bundled base payments cover the expected cost of primary care services but do not encourage quality. Bonus payments incentivize desired outcomes by rewarding better-than-expected performance in clinical quality, efficiency, and patient-centeredness.
Base and bonus payments require credible risk adjustment to discourage practices from cherry-picking easy patients and dumping difficult ones.
Methods
We estimated models to predict thirteen cost and utilization measures in 17.4 million commercially insured people using diagnoses, age, and sex from Thomson-Reuters MarketScan® 2007 claims data.
Using the same data, we imputed assignment of 456,781 people to 436 medium-sized primary care practitioner (PCP) panels (500 – 5000 patients).
For each measure, a PCP’s performance is judged by summing the difference between observed (O) and expected (E) outcomes across panel members.
For each outcome we calculated: mean; coefficient of variation, or CV = SD/mean; and both individual and grouped R2 as measures of predictive accuracy
Results
Using risk models to calculate expected outcomes explained 29-49% of the observed patient-level and 85-98% of practice-level variation in performance, with differential variability.
Deviation from the mean in total health spending is more variable at the PCP level than other more targeted measures.
Creative Commons License
This work is licensed under a Creative Commons Attribution-Noncommercial-Share Alike 3.0 License.
Repository Citation
Ash AS, Ellis RP. (2011). Risk-Based Bonus Payments for the Patient-Centered Medical Home. UMass Center for Clinical and Translational Science Research Retreat. Retrieved from https://escholarship.umassmed.edu/cts_retreat/2011/posters/1
Included in
Risk-Based Bonus Payments for the Patient-Centered Medical Home
Background
The Patient-Centered Medical Home (PCMH) requires fundamental reform of health care financing. We propose a Risk-Based Comprehensive Payment system with risk-adjusted base and bonus payments.
Bundled base payments cover the expected cost of primary care services but do not encourage quality. Bonus payments incentivize desired outcomes by rewarding better-than-expected performance in clinical quality, efficiency, and patient-centeredness.
Base and bonus payments require credible risk adjustment to discourage practices from cherry-picking easy patients and dumping difficult ones.
Methods
We estimated models to predict thirteen cost and utilization measures in 17.4 million commercially insured people using diagnoses, age, and sex from Thomson-Reuters MarketScan® 2007 claims data.
Using the same data, we imputed assignment of 456,781 people to 436 medium-sized primary care practitioner (PCP) panels (500 – 5000 patients).
For each measure, a PCP’s performance is judged by summing the difference between observed (O) and expected (E) outcomes across panel members.
For each outcome we calculated: mean; coefficient of variation, or CV = SD/mean; and both individual and grouped R2 as measures of predictive accuracy
Results
Using risk models to calculate expected outcomes explained 29-49% of the observed patient-level and 85-98% of practice-level variation in performance, with differential variability.
Deviation from the mean in total health spending is more variable at the PCP level than other more targeted measures.