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Risk adjustment
Since the introduction of the Health Insurance Act in 2006, a national system of risk equalization exists among all Dutch health insurers. The purpose of risk adjustment is to avoid risk selection and variation in insurance premiums based on differences in the age, sex and health status of the insured.
Risk adjustment has an enormous impact on the management by health insurance companies of their contractual relationships with care providers and their insured members. Insured persons in poor health may suddenly prove profitable as a consequence of risk adjustment, just as losses may be suffered for subgroups of insured members in good health who incur low medical expenses. Thus, health insurers have a financial incentive for taking up the role of a prudent purchaser of healthcare and identifying opportunities that create value for money for their members in poorer health. It is important for existing and new cure and care initiatives to fully understand the incentives of health insurance in this new context, and to recognise how to align the interests of care providers and their patients with those of the insurers.
Thorough knowledge of risk adjustment is scarce. SiRM has the knowledge and skills to identify the consequences of risk adjustment specific for your organization. If preferred, SiRM will help your organization translate these consequences into plain numbers. Furthermore, SiRM can help formulate a clear strategic policy in this context. Of course, on-the-job training of people within your organization for a full understanding of the nuances of the risk adjustment system can also be arranged.
In the above video clip, the goal of risk adjustment is explained in 6 minutes and you will also find a discussion of the most important current implementation issues in the Netherlands. Source: the PhD defense of SiRM member Piet Stam (October 17, 2007).
Links:- Our answer to 10 FAQs about risk equalisation.
- The legal context of the system risk equalisation by the Dutch Ministry of Health.
- Scientific publications of SiRM partner Piet Stam on the topic of risk equalisation.
