The development of a risk-adjusted capitation payment system: the Maryland Medicaid model.

This article describes the risk-adjusted payment methodology employed by the Maryland Medicaid program to pay managed care organizations. It also presents an empirical simulation analysis using claims data from 230,000 Maryland Medicaid recipients. This simulation suggests that the new payment model will help adjust for adverse or favorable selection.

Changing prescription drug sector: new expenditure methodologies.

Estimating spending for prescription drugs has become increasingly difficult over the past 15 years as extensive changes have taken place within the retail prescription drug industry. Expenditures for prescription drugs in retail outlets grew rapidly during the 1980s and early 1990s. New retail outlets emerged and existing sites lost market share.

Managed Medicaid cost savings: the Arizona experience.

This paper reports on estimated cost savings for acute care beneficiaries in the Arizona Health Care Cost Containment System (AHCCCS) over its first nine years of operation, fiscal years 1983-1991. AHCCCS has similar eligibility and service coverage as a traditional Medicaid program has but capitates health plans to provide medical services to beneficiaries. The results indicate that the program yielded $100 million in savings over estimates of what a traditional Medicaid program would have cost in Arizona.

Costs of insuring preventive care.

Age-, sex-, and other risk factor-specific recommendations, published last year by the U.S. Preventive Services Task Force, for preventive clinical care have raised questions concerning the costs of providing health insurance for these kinds of services.