Analysis of cancer care under the ACA risk adjustment methodology

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By Catherine M. Murphy-Barron, Howard Kahn, Rong Yi | 22 January 2016

Health plans can no longer price based on a member’s underlying health status. To protect plans from adverse selection, the Patient Protection and Affordable Care Act of 2010 (ACA) implemented a risk mitigation program—risk adjustment. Even with the risk adjustment program, some health plans are dropping specialty providers from their networks, citing inadequate protection from adverse selection. This paper analyzes actual claims data using stochastic simulations to model if the ACA risk adjustment is able to fully compensate carriers for adverse selection on cancer claims.

This report was commissioned by Memorial Sloan Kettering Cancer Center.

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