Risk-adjusted capitation payments: how well do principal inpatient diagnosis-based models work in the German situation? Results from a large data set

Eur J Health Econ. 2007 Mar;8(1):31-9. doi: 10.1007/s10198-006-0004-7.

Abstract

Five models of risk adjusters were tested as a (proxy) measure for health status with data from a large German sickness fund. The first two models use standard demographic and socio-demographic variables. One model incorporates a simple binary indicator for hospitalization and the last two are based on the hierarchical coexisting conditions (HCCs: DxCG Risk Adjustment Software Release 6.1) using in-patient diagnoses. Special investigations were done on the subgroups of insurees who left, joined or stayed with the fund over the observation period. Age and gender grouping accounted for 3.2% of the variation in total expenditure for concurrent as well as prospective models. The current German risk adjusters age, sex, and invalidity status account for 5.1 and 4.5% of the variance in the concurrent and prospective models, respectively. Age, gender, invalidity status and in-patient HCC covariates explain about 37% of the variations of the total expenditures in a concurrent model and roughly 12% of the variations of total expenditures in a prospective model. Only modest improvement can be achieved with the long-term-care (LTC) indicator. For high-risk (cost) groups, substantial under-prediction remains; conversely, for the low-risk group, represented by enrolees who did not show any health care expense in the base year, all of the models over-predict expenditure. Special investigations were done on the subgroups of insurees who left, joined or stayed with the fund over the observation period.

MeSH terms

  • Adolescent
  • Adult
  • Age Factors
  • Aged
  • Capitation Fee*
  • Comorbidity
  • Diagnosis-Related Groups / statistics & numerical data*
  • Female
  • Germany
  • Hospitalization / economics*
  • Hospitalization / statistics & numerical data*
  • Humans
  • International Classification of Diseases / statistics & numerical data
  • Male
  • Middle Aged
  • Risk Adjustment / methods*
  • Sex Factors
  • Socioeconomic Factors
  • Young Adult