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Academies Continues Work on Socio-Economic Risk Adjustment

In the latest aspect of its research on socio-economic status for the purpose of its application to Medicare quality measurement and payment programs, the National Academies of Sciences, Engineering, and Medicine has taken a look at the data needed to define socio-economic status.

-academy-of-medicine-274x168In its new report Accounting for Social Risk Factors in Medicare Payment: Data, the Academies, notes that it was hired by the U.S. Department of Health and Human Services to

…convene an ad hoc committee to provide a definition of socioeconomic status for the purposes of application to Medicare quality measurement and payment programs; identify the social factors that have been shown to impact health outcomes of Medicare beneficiaries; specify criteria that could be used in determining which social factors should be accounted for in Medicare quality measurement and payment programs; identify methods that could be used in the application of these social factors to quality measurement and/or payment methodologies; and recommend existing or new sources of data and/or strategies for data collection.

Based on its deliberations, the committee offered seven recommendations addressing data collection:

  1. The committee recommends the Centers for Medicare & Medicaid Services (CMS) use five guiding principles when choosing data sources for specific indicators of social risk to be used in Medicare performance measurement and payment. These guiding principles are
  • CMS should first use data it already has.
  • CMS should second look for opportunities to use existing data collected by other government agencies (including elsewhere in the Department of Health and Human Services).
  • To the extent that a social risk factor is relatively stable, CMS should examine the feasibility of collecting additional data at the time of enrollment in Medicare.
  • Where social risk factors change over time and have clinical utility, requiring data collection through electronic health records or other types of provider reporting may be the best approach.
  • For social risk factors that reflect a person’s context or environment, existing data sources that can be used to develop area-level measures should be considered. 
  1. The committee recommends that the Centers for Medicare & Medicaid Services use existing data on dual eligibility, nativity, and urbanicity/rurality in Medicare performance measurement and payment.
  1. Data for individual measures of race and ethnicity, language, and marital/partnership status and for area-level measures of income, education, and neighborhood deprivation are currently available, and the committee recommends that the Centers for Medicare & Medicaid Services (CMS) use them for performance measurement and payment applications in the short term. However, owing to limitations in these data, CMS should research ways to improve accuracy and collection of individual- level measures of race and ethnicity, language, marital/partnership status, income, and education, as well as an area-level measure of neighborhood deprivation for use in the future.
  1. Individual measures of wealth, living alone, and social support exist, but they are sufficiently limited to preclude their use by the Centers for Medicare & Medicaid Services (CMS) in Medicare performance measurement and payment at this time. Therefore, the committee recommends that CMS research ways to accurately collect data on these indicators. 
  1. Area-level measures exist for housing, but they have limitations for use by the Centers for Medicare & Medicaid Services (CMS) in Medicare performance measurement and payment at this time. The committee recommends that CMS research ways to accurately collect housing data, whether at an individual level or an area level.
  1. The committee recommends that research be conducted on the effect of acculturation, sexual orientation and gender identity, and environmental measures of residential and community context on health care outcomes of Medicare beneficiaries, and on methods to accurately collect relevant data in the Medicare population.
  1. The committee recommends that the Centers for Medicare & Medicaid Services collect information about relevant, relatively stable social risk factors, such as race and ethnicity, language, and education, at the time of enrollment.

NAUH has long maintained that Medicare’s hospital readmissions reduction program needs to be risk-adjusted, arguing that the program treats urban safety-net hospitals unfairly because it fails to recognize the special challenges they face when serving the residents of the low-income communities in which they are located. Most recently, it conveyed these concerns to the Centers for Medicare & Medicaid Services in a letter about the FY 2017 Medicare inpatient prospective payment system and by supporting legislation currently before Congress that would address this issue.

Find the complete report of National Academies of Sciences, Engineering, and Medicine here.

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