 Extreme under and overcompensation in morbidity-based health plan payments: The case of SwitzerlandLukas Kauer, Thomas G. McGuire and Konstantin Beck Health Policy, 2020, vol. 124, issue 1, 61-68 Abstract: In 2020, the Swiss insurer payment model will include a set of sophisticated morbidity indicators in the form of Pharmaceutical Cost Groups (PCGs), added to a payment model currently largely based on age, gender, and a crude morbidity indicator. Adding powerful risk adjustors reduces underpayment for previously highly underpaid groups but creates a new group of the highly overpaid. We characterize the diseases and patterns of health care spending in most extremely under and overpaid in the new Swiss payment model. We define extremely under and overpaid to be those in the top and bottom 1 and .1 percentiles of the distribution of spending less payment, respectively. The under and overpaid share some of the same health conditions, among them kidney disease. The highly underpaid account for a massively disproportionate share of the unexplained variance in the new payment model. Membership in the tails of the distribution of spending residuals after risk adjustment is persistent, implying that the highly over and underpaid merit special attention in design of insurer payment models. Keywords: Health insurance; Risk adjustment; Risk equalization; Risk selection; Payment fit (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:hepoli:v:124:y:2020:i:1:p:61-68 DOI: 10.1016/j.healthpol.2019.11.008 Access Statistics for this article Health Policy is currently edited by Katrien Kesteloot, Mia Defever and Irina Cleemput More articles in Health Policy from Elsevier |
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