risk-iconSection III: Risk Adjustment for Functional Status

Advanced approaches to setting MLTSS rates — such as when and how to risk adjust rates based on functional status and how to account for an extremely diverse LTSS population — can be challenging to design and implement. The resources in this section present considerations for states seeking to incorporate risk-adjustment methods based on functional status into their MLTSS rate-setting process.


Look Before You Leap: Risk Adjustment for Managed Care Plans Covering Long-Term Services and Supports (August 2016, CHCS) This brief reviews risk-adjustment strategies in MLTSS programs that account for enrollees’ functional and cognitive status to improve the accuracy of capitation rates, as well as technical challenges and state program features that may affect the need to use risk adjustment.


Building Managed Long-Term Services and Supports Risk-Adjustment Models: State Experiences Using Functional Data (August 2016, CHCS) This brief describes New York’s and Wisconsin’s sophisticated MLTSS risk-adjustment models that use functional status data to predict LTSS costs.


Population Diversity in Medicaid Managed Long-Term Services and Supports Programs: Implications for Risk Adjustment and Rate Setting (August 2016, CHCS) This brief discusses how states can use information on demographic and functional limitations to predict the cost of care for people with disabilities through risk adjustment and identifies variables that can affect the predictability of LTSS needs and costs that may not be captured in functional assessment data.


Report to the Congress on Medicaid and CHIP: Chapter 4, Functional Assessments for Long-Term Services and Supports (June 2016, Medicaid and CHIP Payment and Access Commission) This report examines the tools used by state Medicaid programs to assess applicants’ health conditions and functional needs when determining LTSS eligibility and creating care plans, and discusses opportunities and challenges for moving toward a single national assessment tool.


Uniform Assessment Practices in Medicaid Managed Long-Term Services and Supports Programs (August 2013, CHCS) This brief explores uniform assessment processes in five states with MLTSS programs to identify what tools are available, how they are administered, and considerations for development and implementation.