The best of both worlds? Potential of hybrid prospective/concurrent risk adjustment.

Background: There remains considerable uncertainty about whether prospective or concurrent risk adjustment (RA) is preferable. Although concurrent models have better predictive power than prospective models, the large payments associated with concurrent RA create incentives for fraudulent coding. A hybrid strategy--in which prospective payments were used for patients with low expected costs and concurrent payments were available upon the diagnosis of a small number of common, expensive conditions--might improve predictive performance while requiring less auditing than fully concurrent RA.