The process of risk adjustment has been indispensable for the economics of the healthcare industry. Risk adjustment ensures healthcare providers are compensated fairly and healthcare patients can plan for future expenses. The main factors affecting risk adjustment calculations are medical history and current health conditions. However, there is another crucial piece of the puzzle that many healthcare providers have overlooked. Socioeconomic status is another major factor for determining risk adjustment.
As founder and CEO of 400-person Medicare platform EasyHealth, David Duel has been making his mark on the healthcare industry. He noted, “In our industry, many doctors are intimately familiar with common risk adjustment factors like previous illnesses, surgeries, or whether a disease runs in the family. Unfortunately, I’ve seen many primary care physicians neglect to document patients’ income and socioeconomic status.”
There are several reasons why socioeconomic status is so important for risk adjustment. First, patients with lower socioeconomic status can be more vulnerable to illness and injury.
David Duel explained, “Preventative care significantly lowers your chances of being hospitalized. Patients with a lower socioeconomic status may not have the same level of access to preventative care, which means they have higher rates of illness and injury.”
Second, doctors should know a patient’s socioeconomic status so they can accurately predict the level of care the patient will need. As a result of this, patients can make payments based on a reliable idea of the future costs their treatment may incur.
David Duel commented, “Including socioeconomic status in comprehensive health screening isn’t just for the healthcare provider’s sake. It also makes things easier for long-term patients and reduces the hassle of figuring out what patients should pay.”