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Derek DeLia’s Recent Articles on Health Care Savings, Spending and Outcomes

Derek DeLia provides a thorough empirical analysis of random variation in shared savings arrangements in “Monte Carlo Analysis of Payer and Provider Risks in Shared Savings Arrangements.” He uses claims data from seven provider coalitions that applied for certification to become Medicaid accountable care organizations (ACOs) in New Jersey to conduct Monte Carlo simulations under varying assumptions about true ACO savings. Among all the ACOs examined, the observed savings rate can be several percentage points higher or lower than the assumed true savings rate leading to large probabilities of Type I and Type II error in determining the existence of savings. Although the effects of random variation are smaller for larger ACOs, the ACO-level coefficient of variation in health care spending also stands out as a highly relevant parameter. The risks of overpayment and underpayment can be minimized through modified specification of the savings measurement methodology. These findings have implications for the terms of shared savings arrangements negotiated between payers and providers.

Medical Care Research and Review October, 73(5): 511-31. October, 2016. In “Mortality, Disenrollment, and Spending Persistence in Medicaid and CHIP” Derek describe patterns of expenditure persistence, mortality, and disenrollment among nondually eligible Medicaid/CHIP enrollees and identifies factors predicting these outcomes. Research on spending persistence has not focused on Medicaid and the Children's Health Insurance Program (Medicaid/CHIP), which includes a complex and growing population. The study is based on New Jersey Medicaid/CHIP claims data from 2011 to 2014 using nondually eligible NJ Medicaid/CHIP enrollees. Descriptive and multinomial regression methods were used to characterize persistently extreme spenders defined as those appearing in the top 1% of statewide spending every year, according to demographics, Medicaid/CHIP eligibility, nursing facility residence, patient risk scores, and clinical diagnostic categories measured in 2011. Similar analyses were done for persistently high spenders (i.e., always in the top 10% but not always top 1%) as well as decedents, disenrollees, and moderate spenders (i.e., at least 1 year outside of the top 10%). One fourth of extreme spenders in 2011 remained in that category throughout 2011-2014. Almost all (89.3%) of the persistently extreme spenders were aged, blind, or disabled. Within the aged, blind, or disabled population, the strongest predictors of persistently extreme spending were diagnoses involving developmental disability, HIV/AIDS, central nervous system conditions, psychiatric disorders, type 1 diabetes, and renal conditions. Individuals in nursing facilities and those with very high risk scores were more likely to die or have persistently high spending than to have persistently extreme spending. The study highlights unique features of spending persistence within Medicaid/CHIP and provides methodological contributions to the broader persistence literature. Medical Care. September 21, 2016.

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