Cover: Adjusting Capitation Rates Using Objective Health Measures and Prior Utilization

Adjusting Capitation Rates Using Objective Health Measures and Prior Utilization

Published 1989

by Joseph P. Newhouse, Willard G. Manning, Emmett B. Keeler, Elizabeth M. Sloss


Download Free Electronic Document

FormatFile SizeNotes
PDF file 1.3 MB

Use Adobe Acrobat Reader version 10 or higher for the best experience.


Purchase Print Copy

 Format Price
Add to Cart Paperback14 pages $20.00

Several analysts have proposed adding adjusters based on health status and prior utilization to the adjusted average per capita cost formula. This Note, reprinted from Health Care Financing Review, Vol. 10, No. 3, Spring 1989, estimates how well such adjusters predict annual medical expenditures among non-elderly adults. Both measures substantially improve on the variables currently used. If only health measures are added, 20-30 percent of the predictable variance is explained; if only prior use is added, more than 40 percent is explained. The results support including some measure of use in the formula until better health measures are developed.

This report is part of the RAND note series. The note was a product of RAND from 1979 to 1993 that reported other outputs of sponsored research for general distribution.

This document and trademark(s) contained herein are protected by law. This representation of RAND intellectual property is provided for noncommercial use only. Unauthorized posting of this publication online is prohibited; linking directly to this product page is encouraged. Permission is required from RAND to reproduce, or reuse in another form, any of its research documents for commercial purposes. For information on reprint and reuse permissions, please visit

RAND is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.