Differentiators Between Transient and Persistent High-Cost Medicare Beneficiaries: An Examination of Utilization and Cost Drivers

Research Objective: Over 70% of Medicare beneficiaries today are in some form of managed care, whether they are assigned to one of Medicare’s shared savings programs or are enrolled in a Medicare Advantage Plan. Developing case management programs for high-cost, high-need Medicare beneficiaries is expensive, but critical for successful financial risk and quality performance. Today’s case management programs are generally one-size-fits-all; however, within the high-cost, high-need Medicare beneficiary population, there exist multiple cost profiles that could lead to population segmentation in case management programs. This dissertation seeks to understand the differences between cost-based Medicare beneficiary categories and to understand if the publicly available Centers for Medicare & Medicaid Services (CMS) Medicare Advantage Hierarchical Condition Categories (HCC) risk adjustment model (CMS-HCC) and DH Kim Claims-Based Frailty Index algorithms can help predict which cost categories a Medicare beneficiary will fall in over subsequent years. As well, this research seeks to identify if there are CMS-HCC conditions and interactions that are characteristic of different categories of high-cost beneficiaries and which can be used to develop targeted case management programs.