What we're reading, August 2, 2016: co-ops in New Mexico and Massachusetts sue the government over the risk-adjustment formula and why hospital ratings should be viewed with a bit of skepticism.
Co-ops in New Mexico and Massachusetts are suing the Obama administration over the management of the program. The states join Maryland, which filed a similar lawsuit in June, arguing that the “risk adjustment” formula overly rewarded big insurers, reported The Wall Street Journal. The co-ops are alleging that CMS hindered their success through the risk-adjustment program. The executives are saying they shouldn’t have to make payments to the government for 2015 based on the current system.
CMS recently released its “Star” ratings for hospital quality, but hospital ratings should be viewed with a bit of skepticism. While information may seem objective, the data points used and how they are weighted can lead to contradictory conclusions, STAT explains. Furthermore, opponents of CMS’ rating system have already made the case that the system penalizes hospitals that treat more low-income patients.