
Contents
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6.1 Literature Review 6.1 Literature Review
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6.1.1 Primary-Encounter Approach 6.1.1 Primary-Encounter Approach
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6.1.2 All-Encounter Approach 6.1.2 All-Encounter Approach
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6.1.3 Episode-Based Approach 6.1.3 Episode-Based Approach
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6.1.4 Person-Based Approach 6.1.4 Person-Based Approach
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6.1.5 Estimation Techniques in the Person-Based Approach 6.1.5 Estimation Techniques in the Person-Based Approach
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6.2 Methods 6.2 Methods
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6.2.1 Data and Study Sample 6.2.1 Data and Study Sample
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Classification of Diseases Classification of Diseases
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Methods for Allocation of Spending to Diseases Methods for Allocation of Spending to Diseases
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6.2.2 Encounter-Based Allocations 6.2.2 Encounter-Based Allocations
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6.2.3 Person-Based Allocation 6.2.3 Person-Based Allocation
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6.2.4 Analyses 6.2.4 Analyses
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6.3 Results 6.3 Results
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6.4 Discussion 6.4 Discussion
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Appendix CCS Categories and ICD-9-CM Codes for All Seventeen Conditions in Table 6.9 Appendix CCS Categories and ICD-9-CM Codes for All Seventeen Conditions in Table 6.9
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References References
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12 Risk Adjustment of Health Plan Payments to Correct Inefficient Plan Choice from Adverse Selection
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6 Attribution of Health Care Costs to Diseases: Does the Method Matter?
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Published:March 2018
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Abstract
Cost of illness (COI) studies focus on allocating health expenditures to a comprehensive set of diseases. Various techniques have been used to allocate spending to diseases. We compare spending attributed to diseases using three approaches: one based on the principal diagnosis listed on each encounter’s claim, a second based on all diagnoses listed on the encounter, and a third based on decomposing a person’s total annual spending to their conditions. The study sample is large: 2.3 million commercially insured individuals under age 65. Results indicate significant differences in the allocations from the different approaches. The two claims-based encounter approaches allocate 78% of overall spending to diseases, while the person approach allocates 95% of spending to diseases. The large unallocated spending in the claims-based approach is due largely to lack of diagnosis codes for prescription medications. Spending was concentrated in a small number of conditions; the 10 most expensive diseases account for 40% of total spending with the person approach and about 18% of spending with the primary-diagnosis and all-diagnoses encounter approaches. Future research needs to pay careful attention to the choice of method in allocating spending to diseases, especially when research uses prescription medication claims data.
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