Because self-insured large employers bear most of the costs for providing healthcare to their employees directly, the applications of risk adjustment in these markets are less obvious. But risk adjustment can be a powerful tool for large employers, who meet certain size thresholds for credibility, looking to identify and contract with the most efficient and highest-quality providers. This paper presents a methodology for total cost of care comparisons in the self-insured employer market using longitudinal analysis of risk-adjusted costs.

This report was commissioned by Imagine Health.