Introduction

This presentation provides a background on risk adjustment, including the general program and policy goals of risk adjustment, the history of risk adjustment, and an overview of risk adjustment systems. It also goes into detail on one risk adjustment model, the Chronic Illness Disability payment system, and describes how diagnostic and pharmacy based models can be used to measure illness burden and to adjust payments to health plans that enroll Medicaid beneficiaries.

This presentation uses MAX data to explore three research questions related to geographic variation in Medicaid expenditures:

• Does interstate variation in Medicaid spending result primarily from variation in the volume of services or in the price per unit of service?
• How do inter- and intrastate variation in Medicaid utilization and spending compare to variation in Medicare spending and utilization?
• Is more health care better for Medicaid beneficiaries?

Successful application of MAX data to research questions requires understanding some specific issues regarding the eligibility and utilization data that is presented in the files. Among the specific topics addressed are Medicaid managed care enrollment, emergency department utilization, prenatal care, outpatient care and utility of long term care claims. The emphasis is on the application of MAX data to research study requirements and what limitations may exist.

This presentation outlines several useful algorithms that can be used to summarize Medicaid eligibility category, coverage by managed care, use of inpatient physician services, mental health services, and common groupings of expenditures.

This presentation will review the source of the data that is used to build the CMS Medicaid Analytic Extract files (MAX), which are the files released when CMS approves a research project requiring Medicaid data. The sources include state Medicaid Management Information System (MMIS) data and Medicaid Statistical Information System (MSIS) data. By understanding the data source files, researchers can understand some of the limitations and correct implementation of MAX data for research.

This video is one segment in a series of videos from ResDAC’s Introduction to the Use of the Medicaid and CHIP TAF (T-MSIS Analytic File) Data for Research. This presentation provides an overview of the Medicaid program. Understanding the programmatic structure underlying the data is key to correct interpretation.

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