Using the Diagnostic Cost Group (DCG) Model to Measure Risk Selection in the Massachusetts State Employee Health Insurance Program

W. Yu, Randall Ellis and A. Ash

Working Papers from Boston University - Industry Studies Programme

Abstract: The Diagnostic Care Group (DCG) model is applied to data from the Massachusetts Group Insurance Commission from fiscal years 1994-1995 and used to assess the extent of biased selection between one fee-for-service (FFS) plan, one preferred provider organization, and several health maintenance organizations. Average reported covered expenses in the FFS plan are 2.7 time the average of expenses in the managed care plans.

Keywords: INSURANCE; RISK; HEALTH (search for similar items in EconPapers)
JEL-codes: H51 I11 I18 (search for similar items in EconPapers)
Pages: 16 pages
Date: 1998
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