- Title Information
- Title
- Corporate Practice of Medicine: Vertical Alignment and Medicare Advantage Risk Coding
- Type of Resource (primo)
- articles
- Abstract
- A long-appreciated, but understudied, aspect of vertical integration is the ability to align
incentives and enable coordination between principals and agents. We examine this
dynamic in the context of vertical alignment between physicians and corporate primary
care practices (CPCPs), which are often integrated with Medicare Advantage (MA) insurers.
While concerns of increased coding intensity in MA are well-documented, the mechanisms
that enable aggressive coding are less clear. Using hand-collected data on physician
employment by CPCPs and national MA encounter data, we find that switching employment
to a CPCP leads to an approximately 25% increase in MA risk score payments after 2 years
and a 35% increase by 5 years. We find no evidence of increased health care utilization or
an alternative risk score that uses pharmaceutical claims rather than recorded medical
diagnoses. The increase in risk scores is driven by low-acuity and discretionary diagnoses.
We estimate that higher risk-score payments due to integration lead to a $1.6 billion
increase in annual payments from taxpayers to MA insurers.
- Name
- Name Part
- David J. Meyers
- Role
- Role Term (marcrelator)
(authorityURI="http://id.loc.gov/vocabulary/relators", valueURI="http://id.loc.gov/vocabulary/relators/aut")
- Author
- Name
- Name Part
- Jay Shroff
- Role
- Role Term (marcrelator)
(authorityURI="http://id.loc.gov/vocabulary/relators", valueURI="http://id.loc.gov/vocabulary/relators/aut")
- Author
- Name
- Name Part
- Yashaswini Singh
- Role
- Role Term (marcrelator)
(authorityURI="http://id.loc.gov/vocabulary/relators", valueURI="http://id.loc.gov/vocabulary/relators/aut")
- Author
- Name
- Name Part
- Christopher Whaley
- Role
- Role Term (marcrelator)
(authorityURI="http://id.loc.gov/vocabulary/relators", valueURI="http://id.loc.gov/vocabulary/relators/aut")
- Author
- Origin Information
- Date Created
- 2025
- Subject (Local)
- Topic
- Medicare Advantage
- Subject (Local)
- Topic
- risk score payments
- Subject (Local)
- Topic
- principal-agent relationships
- Subject (Local)
- Topic
- health care provider consolidation
- Genre
- Working Paper
- Access Condition:
use and reproduction
- All rights reserved
- Access Condition:
rights statement
(href="http://rightsstatements.org/vocab/InC/1.0/")
- In Copyright
- Access Condition:
restriction on access
- All Rights Reserved
- Identifier:
DOI
- 10.26300/amm6-vh76