A Case-Mix System for Adults with Developmental Disabilities

Effective management of publicly funded services matches the provision of needed services with cost-efficient payment methods. Payment systems that recognize differences in care needs (eg, case-mix systems) allow for greater proportions of available funds to be directed to providers supporting individuals with more needs. We describe a new way to allocate funds spent on adults with intellectual disabilities (ID) as part of a system-wide Medicaid payment reform initiative in Arkansas. Analyses were based on population-level data for persons living at home, collected using the interRAI ID assessment system, which were linked to paid service claims. We used automatic interactions detection to sort individuals into unique groups and provide a standardized relative measure of the cost of the services provided to each group. The final case-mix system has 33 distinct final groups and explains 26% of the variance in costs, which is similar to other systems in health and social services sectors. The results indicate that this system could be the foundation for a future case-mix approach to reimbursement and stand the test of “fairness” when examined by stakeholders, including parents, advocates, providers, and political entities.