Risk adjusting for race and poverty bolsters rankings of some hospitals

Sociodemographic risk adjustment of emergency care-sensitive mortality improves the apparent performance of some hospitals treating a large number of non-white, Hispanic or poor patients -- which could be an advantage for safety net hospitals in particular.

That's the finding of a study published in the August 2018 issue of Academic Emergency Medicine, a journal of the Society for Academic Emergency Medicine, which showed there are potentially substantial financial benefits to be gleaned from sociodemographic adjustment for safety net hospitals taking care of vulnerable patients.

Within the broader debate about the role of safety net hospitals, the findings also provide key evidence on potential effects of payment reform on non-emergency care, and on hospital markets more generally.

The authors recommend including sociodemographic adjustment in payment models to avert harm to safety net hospitals and vulnerable patients. 

But they caution that close monitoring, reporting of adjustment trends (including other comorbidities), and robust data transparency -- including rankings stratified by socio-demographics -- are required to avoid exploitation of these adjustments.

Earlier this month, the Centers for Medicare and Medicaid Services issued a proposed rule to use the 2018 benefit year to determine risk adjustment payments to insurers in the Affordable Care Act.

Previously, CMS had issued a final rule which adopted the risk adjustment methodology of the 2017 benefit year, so the Department of Health and Human Services could continue operation of the program to maintain stability and predictability in the individual and small group health insurance markets. 

However, the rule only allowed the program to continue for the 2017 benefit year.  The rule proposed on Aug. 8 would allow the program to continue for the 2018 benefit year.

The study's authors said there's now growing evidence that traditional approaches to risk adjustment don't adequately account for the impact of social inequities on health outcomes. They suggested refining and improving the quality metrics that are used to evaluate hospital and physician performance by integrating social determinants of health into risk adjustment models.

Twitter: @JELagasse
Email the writer: jeff.lagasse@himssmedia.com