Risk Adjustment:

A Tool for Leveling the

Playing Field

Primer

Management Decision and Research Center

Health Services Research and Development Service

Office of Research and Development

Department of Veterans Affairs

In collaboration with

Association for Health Services Research
Risk Adjustment: A Tool for Leveling the Playing Field.

Boston, MA: Management Decision and Research Center; Washington, DC: VA Health Services 

Research and Development Service in collaboration with Association for Health Services 

Research, 1997.

p. cm.

Includes bibliographical references. Primer.

DNLM: 1. Hospitals, Veterans — organization and administration. 2. Outcome 

Assessment (Health Care). 3. Risk Assessment — organization and administration. 4. Risk 

Factors. 5. United States, Department of Veterans Affairs, Management Decision 

and Research Center. 6. Association for Health Services Research.

W84.AA1 R595 1997

The Health Services Research and Development Service (HSR&D) is a 

program within the Veterans Health Administration’s Office of Research

and Development. HSR&D provides expertise in health services research,

a field that examines the effects of organization, financing and management on a wide range of problems in health care delivery — quality of care,

access, cost and patient outcomes. Its programs span the continuum of

health care research and delivery, from basic research to the dissemination

of research results, and ultimately to the application of these findings to

clinical, managerial and policy decisions.
Risk Adjustment:

A Tool for Leveling the

Playing Field

Purpose of primer series: to help bridge the gap between

health services researchers, policy makers, managers and clinicians

in an effort to improve the quality and cost effectiveness of health

care for veterans. The primer series is part of a larger set of dissemination initiatives developed by VHA’s Office of Research and Development through its Management Decision and Research Center and

in collaboration with the Association for Health Services Research.

Pu r p o s e of Risk Adjustment: A Tool for Leveling

t he Playing Field: to introduce the purposes, general

approaches and limitations of risk adjustment. The primer provides

a basic framework for understanding risk adjustment and describes

the potential of risk adjustment as a management tool in health care

settings, particularly in VA. More in-depth readings and other

resources are listed in the appendices.

Suggested audience: professionals involved in health care

decision making, including managers working in administration,

clinical care, quality management and strategic planning at VA 

headquarters, Veterans Integrated Service Networks and within 

VA facilities.

Suggested uses: ■ individual study, ■ management training

programs in Veterans Integrated Service Networks and medical 

centers, ■ resource for strategic planning, ■ continuing medical

education courses and other medical and health professional 

training programs.

November 1997

Boston, Massachusetts 
Table of Contents

i

Contributors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .iii

Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .v

Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .vii

What is risk adjustment?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1

Why do we need risk adjustment?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1

Why is risk adjustment important to VA managers 

and clinicians?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2

Is risk adjustment the same as risk assessment? Is it the same 

as severity adjustment? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2

What data are used to perform risk adjustment?. . . . . . . . . . . . . . . . . .3

What role can risk adjustment play in allocating funds to networks,

facilities and other providers? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4

What role can risk adjustment play in measuring, reporting 

and managing patient outcomes?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5

What are the limitations of risk adjustment?. . . . . . . . . . . . . . . . . . . . .6

Who is coordinating risk adjustment within VA? . . . . . . . . . . . . . . . . .6

What issues should VA managers consider with respect 

to risk adjustment?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7

Concluding remarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9

References. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10

Appendix A: What reading materials are available to provide more 

in-depth information on risk adjustment to VA managers? . . . . . . . .11

Appendix B: Where can VA managers turn for additional information

about risk adjustment? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13

Appendix C: What are some examples of current VA risk adjustment

activities?. . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17
Contributors

Thomas V. Holohan, M.D., is Chief, Office of Patient Care Services,

Veterans Health Administration (VHA). Dr. Holohan directs a staff of

approximately 90 individuals assigned to Strategic Health Groups that

encompass the spectrum of clinical care delivered across VHA. The

Strategic Health Groups provide program and policy development and

direction, data collection and analyses and consultative services on

medical issues to field units, Veterans Integrated Service Network

offices and the Under Secretary for Health. They also serve as sources

of information on clinical programs and as contact points for Congress

and Congressional staff, veterans service organizations, and other governmental agencies and nongovernmental organizations. Prior to his

current appointment, Dr. Holohan was Director, Office of Health Technology Assessment at the Agency for Health Care Policy and Research.

Martin P. Charns, M.B.A., D.B.A., is director of the Management

Decision and Research Center, a program within VHA’s Health Services Research and Development Service. The MDRC’s mission is to

enhance the delivery of the highest quality health care by providing

VA senior staff with consultation, technical assistance, management

information and research findings. MDRC’s four interdependent programs —management consultation, information dissemination, technology assessment and management and organizational research —

provide VA researchers and managers powerful tools for planning and

decision making, helping them find solutions to a wide range of problems in health care delivery. Dr. Charns lectures widely on organizational change in health care organizations. He is currently the

principal investigator on a study of VISN Service Line Implementation

examining the process of change and the effectiveness of service lines.

Acknowledgments. The MDRC and AHSR staff thank the many

managers and researchers within and outside of VA who participated

in the development of this primer. Mary Darby, editorial consultant,

wrote the primer with input from a number of researchers with expertise in risk adjustment. Special thanks go to the following individuals

for their assistance: Dan R. Berlowitz, M.D., M.P.H., VHA HSR&D

Center of Excellence, Bedford, MA; Jennifer Daley, M.D., VA Medical

Center, West Roxbury, MA; Ronald L. Goldman, Ph.D., M.P.H., VHA

Office of Performance and Quality, VA Headquarters; Howard H.

Green, M.D., VHA Decision Support System, Bedford, MA; Ed 

Hannan, Ph.D., State University of New York, School of Public Health,

Rensselaer, NY; Timothy P. Hofer, M.D., M.Sc., VHA HSR&D Center of

Excellence, Ann Arbor, MI; Mark C. Hornbrook, Ph.D., Kaiser Permanente Center for Health Research, Portland, OR; Lewis E. Kazis,

Sc.D., VHA HSR&D Center of Excellence, Bedford, MA; Elisabeth

McSherry, M.D., M.P.H., VHA Decision Support System, Bedford, MA;

Mark A. Moskowitz, M.D., Boston University School of Medicine,

Boston, MA; Nancy J. Petersen, Ph.D., VHA HSR&D Center of Excellence, Houston, TX; Gary E. Rosenthal, M.D., VA Medical Center,

Cleveland, OH; Elizabeth Thiner, R.R.A., VA Medical Center, Sioux

Falls, SD; Gary J. Young, J.D., Ph.D., VHA Management Decision and

Research Center, Boston, MA.

We also extend our appreciation to colleagues throughout VA for their

thoughtful comments in reviewing an earlier draft of the primer:

Edward Deakin, VISN 11, Ann Arbor, MI; Janet A. Deneselya, Ph.D.,

iii
iv

VA Medical Center, Butler, PA; Renee Donaldson, R.N., VA Upper

Midwest Network, Minneapolis, MN; John R. Feussner, M.D., VHA

Office of Research and Development, VA Headquarters; Charles G.

Humble, Ph.D., VHA National Performance Data Resource Center,

Durham, NC; Shirley Meehan, M.B.A., Ph.D., VHA Health Services

Research and Development Service, VA Headquarters; Elvira Miller,

Ed.D., R.N., VA Medical Center, NY, NY; Ron Norby, R.N., VA Desert

Pacific Health Care System, Long Beach, CA; Thomas Parrino, M.D.,

VA New England Health Care System, Boston, MA; Alan S. Perry,

FACHE, VA Medical Center, Roseburg, OR. We also thank Maria L.

Fonseca, M.A., VHA Management Decision and Research Center,

Boston, MA, for her skilled facilitation of the focus groups.
Preface

v

As the Veterans Health Administration (VHA) moves toward objective appraisal of outcome and other clinical performance measures,

risk adjustment will become increasingly important in making

informed clinical, administrative and economic decisions. Decision

makers at all levels of VHA need to recognize how risk adjustment

can be used to isolate the outcomes of treatment interventions from

pre-existing factors, such as the severity of patients’ illnesses.

Understanding these relationships is critical in order to adopt the

best and most cost-effective practices.

Many factors play a role in determining patient outcomes yet have

nothing to do with the quality of the care provided. Types, severity

and incidence of illness vary significantly across and even within 

networks. Geographic factors, population densities and distances

between facilities may have profound effects on practice patterns,

access to care and patient outcomes. Coverage limits that differ

across state medical aid programs may influence veterans’ illness

severity, as well as the spectrum of services those veterans seek from

VHA. In addition, recent research has shown that higher patient

income is positively associated with better clinical outcomes.

These factors are particularly important for VHA to understand

because its patients generally have poorer health status and lower

economic status than other patients across the country. If, as 

proposed, VHA is to compare its performance relative to “national”

standards, these differences must be taken into consideration.

The initial publication of unadjusted Medicare mortality data illustrates this point. These data showed that the death rate for cholecystectomy was lower at a small rural Maryland community hospital

than at Johns Hopkins University Hospital. However, it is impossible to conclude on the basis of those data alone where a prudent

patient should seek the procedure, because it is likely that the more

difficult cases were referred to Hopkins. Unadjusted mortality rates

provide little information on the actual relative hazards associated

with care in different hospitals.

Risk adjustment has had a significant impact on clinical practice

and research. It has been used to determine best practices for many

malignant diseases. For example, treatment selection for Hodgkins

disease often derives from whether a patient has exhibited apparently trivial symptoms such as fever, night sweats or weight loss – all of

which have been associated with poorer prognoses. In addition,

research in oncology has demonstrated the significant pretreatment

influence of many characteristics on patient outcomes. As a result,

virtually all cancer research protocols stratify patients at entry for

such factors. 

An understanding of risk adjustment is also invaluable when

appraising clinical trial results. For example, several studies reported that organ recipients who underwent a dual-organ transplant

enjoyed a higher quality of life than single-transplant patients. But a

careful review revealed that the clinical selection criteria for the two

Decision makers at all

levels of VHA need to

recognize how risk

adjustment can be used

to isolate the outcomes

of treatment 

interventions from 

pre-existing factors . . .
interventions differed; the sickest patients were only offered a single

transplant. As a result, it is impossible to tell whether dual-transplant patients’ slight benefit was due to the second graft or to their

better health at the time of transplant. Such study designs are frequently encountered in reports alleging the benefit of a wide variety

of interventions.

These are just a few illustrations of how risk adjustment can be

used to manage and provide care more effectively. In addition, risk

adjustment is becoming increasingly important in resource allocation. As pressures to contain health care costs continue, it is important to understand where the needs are greatest in order to target

resources effectively.

Risk adjustment is an important topic that demands serious attention. This primer is designed to provide decision makers at all levels

of VHA with a basic understanding of risk adjustment and resources

to turn to for additional information.

Thomas V. Holohan, M.D.

Chief, Office of Patient Care Services

Veterans Health Administration

vi
Introduction

vii

VA’s mission of providing excellent health care service and value

to America’s veterans is becoming increasingly complex in today’s

rapidly changing health care environment. To achieve its objectives,

VA must identify and successfully implement new and emerging tools

that will promote high-quality, effective and efficient care and

deployment of resources according to local needs. Risk adjustment is

one of those critical new tools.

Risk adjustment is a method of compensating for differences in

health status among patients that may affect their health care treatment outcomes. It is a way to level the playing field by determining

how sick patients are when they enter a health care encounter. Only

then can we accurately measure and assess the effects of our interventions on patients.

Outcomes research, performance measurement, quality improvement and resource allocation under capitation are critical components of VA’s new strategy for achieving and delivering excellent

service and value. Risk adjustment is an essential tool for integrating these components at the national, network and facility levels.

VA is committed to supporting the development and use of credible

and reliable risk-adjustment mechanisms. This primer is designed to

help clinicians, managers and policy makers gain a better understanding of the fundamentals of risk adjustment and its potential

applications by VA. A question-and-answer format has been used for

easier reading. Included are several examples of VA research that

use risk adjustment, as well as three appendices of in-depth reading

resources and people and organizations involved in risk adjustment.

Martin P. Charns, M.B.A., D.B.A.

Director, Management Decision and Research Center

Health Services Research and Development Service

Office of Research and Development

Veterans Health Administration

This primer is designed

to help clinicians, 

managers and policy

makers gain a better 

understanding of the

fundamentals of risk

adjustment and its

potential applications

by VA .
What is risk adjustment?

Risk adjustment is a mechanism to compensate for differences

among patients that may affect their health care outcomes. It is a

way to level the playing field by accounting for illness, demographics

and other factors that patients bring to a health care encounter.

Why do we need risk adjustment?

Risk adjustment creates a starting point from which sound comparisons about treatment effectiveness, provider and organizational

performance and resource needs may be made. By recognizing that

not all patients are alike, risk adjustment helps assure that clinical

treatment and management decisions are grounded in sound information.

Risk adjustment is important for a number of reasons:

■ First, risk adjustment is a critical concern in internal quality

improvement initiatives and in performance measurement activities

that involve comparisons of different providers. By reconciling key

differences among patients, risk adjustment permits comparisons of

“apples with apples.” Studies have shown that failure to adjust

appropriately for patient risk produces comparisons that are flawed,

misleading and, sometimes, meaningless. Risk adjustment also figures heavily in efforts to track quality, either internally or across

facilities, over time, by helping to establish a valid baseline.

■ Second, risk adjustment is necessary in outcomes studies that seek

to ascertain the effectiveness of specific health care treatments and

interventions. Without adequate risk adjustment, it is impossible to

say whether perceived improvements in patient outcomes reflect 

better treatment, healthier patients or other factors.

■ Third, risk adjustment is an increasingly important consideration

in the allocation of funds to providers. Risk adjustment helps

providers quantify their patients’ illness burdens and predict their

resource needs and costs accordingly. In this way, risk adjustment

facilitates more rational resource allocation based on need. Most

capitated payment methods use some type of risk adjustment to

come up with payment amounts that take into account providers’

resource requirements for treating their patients. Probably the most

prominent example of this use of risk adjustment comes from the

Health Care Financing Administration, which adjusts for demographic and geographic variables in setting payment rates for

Medicare risk plans.

1

Risk adjustment creates

a starting point from

which sound 

comparisons about

treatment effectiveness,

provider performance

and resource needs may

be made.
S

Why is risk adjustment important to VA managers 

and clinicians?

ince its reorganization, VHA has embarked on a course that is

focused on achieving excellence in health care value. Performance

measurement, quality improvement and the pooling and alignment

of resources in accordance with local needs are critical components

of this strategy. Risk adjustment is an essential tool for conducting

these activities at the national, network and facility levels.

Risk adjustment will become increasingly important to VHA managers. VHA is implementing a commercial software program called

the Decision Support System (DSS) to help manage quality and

costs. Ultimately, DSS will serve as VA’s principal clinical management, budgeting and planning system. It may be used alone to

determine risk, or it may be used in conjunction with other risk

adjustment methods. DSS is a patient-focused program that can tag

each patient with a specific risk code. It can do the same with outcome codes. In this way, patients may be sorted and grouped by risk

and outcome and associated costs. DSS has significant applications

for quality improvement and budget planning at all levels of VA.

An understanding of risk adjustment will also help clinicians

make better informed assessments of new research findings and

decide whether and how they should use those findings themselves.

In addition, clinicians who are familiar with risk adjustment will

have a clearer understanding of activities related to performance

measurement, benchmarking, quality improvement and practice

guidelines. 

Is risk adjustment the same as risk assessment? 

Is it the same as severity adjustment?

Risk adjustment and risk assessment are related but different concepts. Risk adjustment must be preceded by some form of risk

assessment. The term “risk assessment” is used in two ways. Risk

assessment is the process through which insurers and decision makers attempt to predict claims costs for a specific enrollee or patient

population group. These efforts to predict costs generally factor in

claims experience or health care utilization and demographic and

geographic characteristics. In that sense, risk assessment may draw

on some of the same types of data used in certain risk adjustment

methods, but for a different purpose. Risk assessment may also

refer to attempts by clinicians to predict a patient’s risk for experiencing a specific adverse outcome or event, such as developing a 

certain type of cancer.

Risk adjustment and severity adjustment may be used interchangeably, although the term “risk adjustment” appears to be 

better understood and more widely used. Indeed, one expert

observes that the problem with the term “severity adjustment” is

that it lacks a single, precise definition and may mean different

things to different people.1 This applies to the term “case-mix

adjustment” as well.

2
What data are used to perform risk adjustment?

Good risk adjustment depends on the collection of good data that

measure various dimensions of risk. These dimensions may include:2

■ Age

■ Sex

■ Extent and severity of principal diagnosis

■ Comorbid chronic illnesses

■ Physical functional status

■ Cultural and socioeconomic attributes

■ Patient attitudes and preferences for outcomes 

These data generally have come from either administrative

sources or medical records, although some researchers are using

data from patient health status surveys as well. Each source has its

advantages and its drawbacks. Administrative data are less costly to

collect and are more readily available for populations of patients.

However, they contain limited clinical information. Medical record

data are much more difficult and costly to collect, but they are richer

in clinical detail. Patient surveys may supply information about

patient attitudes, preferences and health status that is otherwise 

difficult to obtain. But surveys are also costly because of the time

required to administer them and the expertise needed to interpret

them correctly. The choice of what data sources to use for risk

adjustment will involve some trade-offs.

The ability to distinguish pre-existing conditions from conditions

that develop subsequent to a health care encounter is critical. Hospital discharge data, for example, may tell you that a bypass surgery

patient had a secondary diagnosis of pneumonia, but they won’t 

tell you whether that pneumonia was a pre-existing condition or

whether it developed during hospitalization. It is important to collect data in such a way that the effect of health care provided can be

differentiated from the patient’s condition before receiving any care. 

Data may be used in a variety of risk adjustment methods,

depending on the questions you are trying to answer. For example, 

a comparison of hospital length-of-stay following bypass surgery

requires a different approach than an examination of emergency

room admissions for diabetics. Most risk adjustment methods rely

on a combination of clinical judgment and empirical modeling.

Commercial vendors have developed a variety of risk adjustment

products, some of which use administrative data and some of which

rely on clinical data. These systems are all designed for different

purposes. Most are geared toward risk-adjusting for hospital-based

surgical procedures, like bypass surgery, or conditions commonly

treated in hospitals, such as pneumonia. These systems focus on

particular dimensions of risk, and they use different data terms and

definitions, as well as particular variables and other methodologic

considerations. Many of these systems have been reviewed in the

medical literature. It is wise to keep in mind that the state of the art

may vary considerably, depending on the health care conditions,

treatments and settings involved.

3

Good risk adjustment

depends on the 

collection of good data

that measure various

dimensions of risk. 
Most risk adjustment activities for inpatient care at VA have

drawn on its Patient Treatment File (PTF) administrative database.

Researchers at HSR&D’s Houston Center for Quality of Care and

Utilization Studies have conducted several studies using the PTF

and are evaluating the PTF’s predictive powers compared with two

models that are based on clinical data. The researchers hope to 

produce a comprehensive analysis of the strengths and weaknesses

of the PTF with respect to risk adjustment, as well as specific 

information on how this data source may be improved or enriched

with clinical data. 

VA also is interested in developing models for outpatient risk

adjustment. A new outpatient database, called the National Patient

Care Database, will create opportunities at VA for outpatient risk

adjustment as well.3

What role can risk adjustment play in allocating funds 

to networks, facilities and other providers?

To assure optimal care for VA’s sickest and most vulnerable

patients, networks, facilities and other providers must not be penalized financially if they care for large numbers of very sick patients.

Risk adjustment can assist VA in its efforts to deploy resources

where they are needed most.

On April 1, 1997, VA began allocating its medical care funds on a

capitation-based model among the 22 Veterans Integrated Service

Networks (VISNs). The new funding model, called the Veterans

Equitable Resource Allocation (VERA) system, is designed to ensure

that the distribution of funds supports equitable access to care based

on need, rather than on historic funding patterns.

Research in progress may help refine a risk adjustment method

for VERA. In particular, the Veterans Health Study, a large-scale

observational study of veterans, has found that illness burden as

measured in health status surveys filled out by veterans is a good

indicator of resource need. Information culled from these surveys

may be used to develop risk profiles of patients at the VISN and

facility levels. These profiles may then be used to make risk comparisons across VISNs and across facilities. Discussions are underway

on how findings from this research may be integrated with the

VERA system. 

4

Risk adjustment can

assist VA in its efforts to

deploy resources where

they are needed most.
What role can risk adjustment play in measuring, 

reporting and managing patient outcomes?

Performance measurement is a critical component of VHA’s objective to promote a culture of continuous quality improvement that

will maximize the value of VA’s health care services. VA is committed to measuring, reporting and comparing performance for multiple

patient outcomes at the national, VISN and facility levels. VA also

wants to become competitive with the private sector in terms of

quality and efficiency – and that means being able to compare its

performance with that of non-VA providers.

Accurate, meaningful comparisons will require adequate risk

adjustment. The Veterans Health Study has shown that illness 

burdens vary widely across VISNs. In addition, other studies have

shown that VA patients tend to be sicker than patients treated in

non-VA facilities. Sound risk adjustment will help VA determine

which providers really provide better care – and, ultimately, identify

best practices of care.

Currently, VA’s national performance measurement system does

not incorporate much risk adjustment, although patient satisfaction

survey measures used by the National Customer Feedback Center

are risk-adjusted using several variables, including age and sex. In

addition, activities that compare VISN performance against that of

the local Medicare population are adjusted for regional factors.

Other well-established performance measurement systems within

VA are not only using risk adjustment but searching for ways to

improve it. The National VA Surgical Quality Improvement Program (NSQIP) is a good example. This program began as a multiyear investigation into clinical and management factors that

influence outcomes of surgical care. It produces risk-adjusted outcomes data on specific surgical interventions. Research from this

program has identified important links between processes, structures and outcomes of care and has served as the impetus for local

surgical quality improvement projects throughout VA.

The Center for Continuous Quality Improvement in Cardiac

Surgery, based at the Denver Veterans Ambulatory Medical Center

(VAMC), has done considerable work in the calculation and analysis

of risk-adjusted outcomes among cardiac surgery patients.

Researchers have estimated the relative risk of death for numerous

patient-specific factors. This work is now being applied to clinical

decision making through continuous feedback of quality improvement data to cardiothoracic surgeons and cardiologists, and overall

mortality has declined significantly. Researchers are now conducting

a study of how the organization and processes of cardiac services

units affect outcomes of open heart surgery for atherosclerotic 

cardiovascular disease. 

The HSR&D Center for Practice Management and Outcomes

Research in Ann Arbor, MI, has produced annual risk-adjusted

length-of-stay profiles of VA hospitals for about six years.

Researchers are now shifting the focus of their efforts from inpatient

stays toward reporting on episodes of care. In addition, the HSR&D

Center for Quality of Care and Utilization Studies in Houston, TX,

has been providing risk-adjusted data to compare VISN performance

in inpatient and outpatient utilization and mortality for several

years.4

5

. . . performance 

measurement systems

within VA are not only

using risk adjustment

but searching for ways

to improve it.
What are the limitations of risk adjustment?

The greatest limiting factors to any risk adjustment method are

the uniformity, reliability and accessibility of the data on which it is

dependent. These are issues that managers will have to consider

carefully when deciding what risk adjustment methods to use. The

data will more or less dictate what dimensions of risk for which you

may control.

Risk adjustment systems differ greatly in their ability to explain

variations in patient outcomes and resource utilization. They may

account for only a small proportion of these variations. For example,

the Physician Payment Review Commission reported that the ability

of prospective risk adjusters to explain variations in individual-level

health care costs ranged from about 1 percent to as much as 13 percent when a number of predictors were combined. “In theory, a perfect risk adjustment formula might explain as much as 25 percent of

the variation in individuals’ costs,” the commission notes.5

Risk-adjusted outcomes reports have from time to time resulted in

the publication and dissemination of information that is confusing,

contradictory and controversial. Experts disagree, for example, on

the value of risk-adjusted death rates in determining hospital 

quality. Hospitals that were identified as low-performing “outliers”

using one risk adjustment formula later were found to be average

performers using another.

There is no perfect risk adjustment system, and managers would

be wise to think of risk adjustment as a tool for accomplishing a larger purpose, such as quality improvement or more equitable resource

allocation. For example, few clinical quality improvement programs

that rely on outcomes measurement will succeed without some type

of risk adjustment, because physicians probably will not accept the

data as credible otherwise. Risk adjustment also helps minimize situations in which hospitals or physicians feel pressured to turn away

high-risk patients out of fear that they will suffer financially if they

accept them. In short, risk adjustment may be viewed as an imperfect but needed tool.

Who is coordinating risk adjustment within VA?

Risk adjustment at VA is being done at the national, VISN and

local levels. Within the Office of Policy Planning and Performance

(OPPP), the Performance Management Office oversees ongoing 

performance improvement activities, including risk adjustment.

Within the Office of Research and Development (OR&D), the Health

Services Research and Development Service (HSR&D) has and will

continue to commit resources to developing and testing risk 

adjustment methods.

A number of research projects within VA are investigating the

design and use of various risk adjustment methods to measure performance, validate treatment effectiveness, improve care and allocate resources. A subset of these projects, with contact information,

is included in Appendix C.

6

Risk adjustment systems

differ greatly in their

ability to explain 

variations in patient

outcomes and resource

u t i l i z a t i o n .
What issues should VA managers consider with 

respect to risk adjustment?

Managers need to recognize that if they are planning to do any

type of outcomes-based comparisons or evaluations, they should use

risk adjustment, or their information may be flawed. A number of

resources are available to managers, some of which are listed in

Appendix C. Some considerations while contemplating risk adjustment include: 

■ What questions are you trying to answer? Are you trying to identify mortality rates among hospitals for cardiac bypass surgery, or

evaluate length-of-stay in intensive care units? The type of risk

adjustment that you need will depend largely on the problems you

are trying to solve.

■ What type of risk adjustment instrument do you want to use? Do

you want to buy an off-the-shelf product or develop something inhouse? You could also take a commercial product and modify it to

suit your purposes. All of these choices involve trade-offs in time,

cost, quality and specificity that you will have to evaluate carefully.

■ How should you report risk-adjusted information? It is usually

helpful to include a technical explanation of the risk adjustment

method or system that you used when reporting risk-adjusted outcomes data. This is particularly important if you are sharing your

information with clinicians, who may be skeptical of the validity of

the data.

7

Managers need to 

recognize that if they

are planning to do any

type of outcomes-based

comparisons or 

evaluations, they should

use risk adjustment. . .
Concluding remarks

9

Risk adjustment is an essential tool for accomplishing several

objectives that are important to VA: clinical quality improvement

and performance measurement, assessment of the effectiveness of

new health care interventions and technologies and rational resource

allocation. For this reason, it is important for VA managers, clinicians and other decision makers to understand the fundamentals of

risk adjustment and how it can help them provide better and more

cost-effective care.

However, it is also important to point out that risk adjustment

itself does not provide the answers to the issues we are trying to

resolve – rather, it is a means for helping us find more accurate

answers. Because these issues are so critical to VHA’s new mission,

VHA will look for new ways to apply risk adjustment as it continues

its efforts to provide excellent health care services to U.S. veterans.

. . . risk adjustment

itself does not provide

the answers – rather, 

it is a means for helping

us find more accurate

a n s w e r s .
References

1

Iezzoni, L.I., “Dimensions of Risk,” in L.I. Iezzoni (ed.), Risk

Adjustment for Measuring Health Care Outcomes. Ann Arbor, MI,

Health Administration Press, 1994.

2 This list is taken from a May 7, 1997, presentation by Lisa Iezzoni

for the Center for Studying Health System Change in Alexandria,VA.

3 For more information on the National Patient Care Database, 

contact Elizabeth Thiner, RRA, phone: 605/333-6846.

4 Ashton, Carol M., et al, Assessment of Performance of Veterans Integrated Service Networks (VISNs); Clinic and Cohort Survival Rates

in Eight Disease Cohorts, Health Services Research and Development Service of the Veterans Health Administration, January 1996.

5 Physician Payment Review Commission, Annual Report to 

Congress, Washington, D.C., 1996, p. 269.

10
Appendix A: What reading materials are available

to provide more in-depth information on risk 

adjustment to VA managers? 

11

Anderson, R.V., “Can Risk Assessment Tools be Feasibly Used in the

Health Benefit Marketplace?” Advances in Health Economics and

Health Services Research, 12: 3-18, 1991.

Ashton, C.M, and Wray, N.P. “A Conceptual Framework for the Study

of Early Readmission as an Indicator of Quality of Care.” Social 

Science Medicine, 43(11): 1533-41, December 1996.

Berlowitz, D.R., Ash, A.S., Brandeis, G.H., Brand, H.K., Halpern, J.L.,

and Moskowitz, M.A. “Rating Long-Term Care Facilities on Pressure

Ulcer Development: Importance of Case-Mix Adjustment.” Annals of

Internal Medicine, 124(6): 557-63, March 15, 1996.

Bowen, B. “The Practice of Risk Adjustment.” I n q u i r y, 32: 33-40, 1995.

Daley, J.D. “Criteria by Which to Evaluate Risk-Adjusted Outcomes

Programs in Cardiac Surgery.” Annals of Thoracic Surgery, 58(6):

1827-35, December 1994.

Ellis, R.P., Pope, G., Iezzoni, L., Ayanian, J., Bates, D., Burstin, H.,

Ash, A. “Diagnosis-Based Risk Adjustment for Medicare Capitation

Payments.” Health Care Financing Review 17(3), Spring 1996.

Ellis, R.P. and Ash, A. “Refinements to the Diagnostic Cost Group

Model.” Inquiry 32:1-12, Winter 1995.

Faulkner & Gray’s Healthcare Information Center. 1996 Clinical 

Performance Data Sourcebook. New York, NY: Faulkner & Gray’s

Healthcare Information Center, 1995.

Fowles, J.B., Weiner, J.P., Knutson, D., Adlis, S., Craft, C., Fowler, E.J.,

Ireland, M., Kind, E.A., Kvanbeck, M., Petrie, D. & Tucker, A.M. 

A Comparison of Alternative Approaches to Risk Management (Final

Report submitted to the Physician Payment Review Commission),

Minneapolis: Park Nicollet Medical Foundation, Health Research 

Center and The John Hopkins University, Health Services Research

Center, School of Hygiene and Public Health, 1994.

Fowles, J.B., Weiner, J.P., Knutson, D., Fowler, E.J., Ireland, M., &

Tucker, A.M. “Taking Health Status Into Account When Setting 

Capitalization Rates.” Journal of the American Medical Association,

276(16): 1316-21, October 23/30, 1996.

Gauthier, A.K., Lamphere, J., and Barrand, N.L. “Risk Selection in 

the Health Care Market: A Workshop Overview.” I n q u i r y, 32: 14-22, 1995.

Grover, F.L., Shroyer, L.W., and Hammermeister, K.E. “Calculating

Risk and Outcome: The Veterans Affairs Database.” Annals of 

Thoracic Surgery, 62(5 suppl): S6-11, 1996.

Hofer, T.P., and Hayward, R.A. “Identifying Poor-Quality Hospitals:

Can Hospital Mortality Rates Detect Quality Problems for Medical

Diagnoses?” Medical Care, 34(8): 737-53, August 1996.
12

Hornbrook, M.C., and Goodman, M.J. “Adjusting Health Benefit Contributions to Reflect Risk.” Advances in Health Economics and

Health Services Research, 12:41-76, 1991.

Hornbrook, M.C., and Goodman, M.J. “Health Plan Case Mix: Definition, Measurement, and Use.” Advances in Health Economics and

Health Services Research,12:111-48, 1991.

Hornbrook, M.C., and Goodman, M.J. Chronic Disease, Functional

Health Status, and Demographics: A Multi-Dimensional Approach to

Risk Adjustment (9/7/94 draft). Portland, OR: Center for Health

Research, Kaiser Permanente, Northwest Region, 1994.

Hornbrook, M.C., and Goodman, M.J. “Assessing Relative Health

Plan Risk with the RAND-36 Health Survey.” Inquiry, 32: 56-74,

1995.

Iezzoni, L.I. “Using Risk-Adjusted Outcomes to Assess Clinical Practice: An Overview of Issues Pertaining to Risk Adjustment.” Annals

of Thoracic Surgery, 58(6): 1822-6, December 1994.

Iezzoni, L.I. (ed.), Risk Adjustment for Measuring Healthcare Outcomes, Second Edition, Ann Arbor, MI: Health Administration Press,

1997.

Khuri, S.F., Daley, J., Henderson, W., Barbour, G., et al. “The National Veterans Administration Surgical Risk Study: Risk Adjustment

for the Comparative Assessment of the Quality of Surgical Care.”

Journal of the American College of Surgeons, 180: 519-31, May 1995.

Lee, C., and Rogal, D. Risk Adjustment: A Key to Changing Incentives in the Health Insurance Market. Washington, DC: Produced for

The Robert Wood Johnson Foundation’s Changes in Health Care

Financing and Organization Program, Written and Published by the

Alpha Center, 1997.

Locallo, A.R., et al. “Comparing Hospital Mortality in Adult Patients

With Pneumonia; A Case Study of Statistical Methods in a Managed

Care Program.” Annals of Internal Medicine, 122: 125-32, 1995.

Newhouse, J.P. “Patients at Risk: Health Reform and Risk Adjustment.” Health Affairs, 13: 132-46, 1994.

Robinson, J.C., Luft, H.A., Gardner, L.B., and Morrison, E.M. “A

Method for Risk-Adjusting Employer Contributions to Competing

Health Insurance Plans.” Inquiry, 28: 107-116, 1991.

Rosenkranz, S.L., and Luft, H.S. “Expenditure Models for Prospective Risk Adjustment: Choosing the Measure Appropriate for the

Problem.” Medical Care Research and Review, 54: 123-143, 1997.

Wray, N.P., Ashton, C.M., Kuykendall, D.H., and Hollingsworth, J.C.

“Using Administrative Databases to Evaluate the Quality of Medical

Care: A Conceptual Framework.” Social Science and Medicine,

40(12): 1707-15, June 1995.
Appendix B: Where can VA managers turn for

additional information about risk adjustment?

Listed below are some organizations within and outside of VA that

may provide useful information about risk adjustment. This list is

not exhaustive.

Inside VA

Office of Performance and Quality

VA Headquarters

Nancy Wilson, M.D., Director

phone and FTS: 202/273-8936

fax: 202/273-9030

The Office of Performance and Quality oversees ongoing performance

improvement activities. This office is responsible for: system 

performance measures and evaluation; benchmarking and best 

practices; risk adjustment; leadership on issues related to the Joint

Commission on Accreditation of Healthcare Organizations and the

National Committee for Quality Assurance; clinical guidelines; and

the National Performance Data Resource Center and the National

Customer Feedback Center.

National Performance Data Resource Center

Durham VAMC

Eileen Ciesco, Ed.D., Acting Director

phone: 919/286-6978

FTS: 700/671-6978 x229

fax: 919/286-6864

e-mail: ciesco.eileen@forum.va.gov

The NPDRC’s mission is to enable VISNs and facilities to improve

performance and advance the delivery of health care by offering

understandable, applicable, impartial and comparable data and

information systems that support VHA’s vision and strategic 

p r i n c i p l e s .

Office of Research and Development (OR&D)

VA Headquarters

John R. Feussner, M.D., Chief Research and Development Officer

phone and FTS: 202/273-8284

fax: 202/273-6526 

OR&D focuses its efforts on the health and care of our nation’s veterans. The office oversees the full range of research in VA including:

medical research, multi-site clinical trials, rehabilitation research

and health services research. OR&D acts as a clearinghouse for VA

activities related to risk adjustment. 

Cooperative Studies Program Coordinating Center, Hines, IL

William G. Henderson, Ph.D.

Chief, CSPCC, Hines, IL

phone: 708/343-7200 x5853

FTS: 700/381-5853

fax: 708/216-2116

e-mail: henderson@research.hines.med.va.gov

The five Cooperative Studies Program Coordinating Centers

(CSPCC) provide statistical and methodological, pharmaceutical

13
and administrative support to multi-site clinical trials and other

research studies conducted through the VA Cooperative Studies

Program. The Hines CSPCC performs the data coordination and

analysis for the VA National Surgical Quality Improvement Program.

Health Services Research and Development Service

(HSR&D)

VA Headquarters

John G. Demakis, M.D., Acting Director 

phone and FTS: 202/273-8287

fax: 202/273-9007

Within the Office of Research and Development, HSR&D provides

expertise in health services research, a field that examines the effects

of health care organization, financing and management on a wide

range of delivery issues, including quality of care, access, cost and

patient outcomes. These programs span the continuum of health

care research and delivery, from research to the dissemination of

research results, and, ultimately, to the application of these findings

to clinical, managerial and policy decisions. HSR&D’s key operating

units are its nine field programs, each of which is a center of excellence in a particular domain of health services research, along with

the Management Decision and Research Center (MDRC) which facilitates the interaction between HSR&D and VHA senior managers

and policy makers. Contact information for HSR&D field programs

with expertise in risk-adjustment is listed below:

Center for Practice Management and Outcomes

Research

Ann Arbor VAMC

Rodney A. Hayward, M.D., Director

phone and FTS: 313/930-5100

fax: 313/930-5159

Center for Health Quality, Outcomes and Economic

Research

Bedford VAMC

Mark J. Prashker, M.D., M.P.H., Director

phone and FTS: 781/687-3250

fax: 781/687-3106

email: Prashker.Mark@Bedford.va.gov

Midwest Center for Health Services and Policy Research

Hines VAMC

John G. Demakis, M.D., Director

phone: 708/216-2414

FTS: 700/381-2414

fax: 708/216-2316

email: demakis@research.hines.med.va.gov

Center for Quality of Care and Utilization Studies

Houston VAMC

Nelda P. Wray, M.D., M.P.H., Director

phone: 713/794-7615

FTS: 700/528-7615

fax: 713/794-7103

HSR&D Field Program for Mental Health

Little Rock VAMC

G. Richard Smith, M.D., Director

phone: 501/688-1622

FTS: 700/742-1622

fax: 501/688-1621

14
Center for Health Care Evaluation

Palo Alto VAMC

Rudolf H. Moos, Ph.D., Director

phone: 415/858-3996

FTS: 700/463-5527

fax: 415/852-3420

e-mail: ms.rhm@forsythe.stanford.edu

Management Decision and Research Center

Martin P. Charns, M.B.A., D.B.A., Director

phone: 617/278-4433

FTS: 700/839-4433

fax: 617/278-4438

e-mail: vhaboscharnm@med.va.gov

Outside VA

Agency for Health Care Policy and Research (AHCPR)

Center for Outcomes and Effectiveness Research

Carolyn M. Clancy, M.D., Director

phone: 301/594-1485, ext. 1199

website: http://www.ahcpr.gov

AHCPR is a good source of information about issues related to outcomes and effectiveness research. Its website contains a search area

where articles and reports with information on risk adjustment may

be found. In addition, AHCPR’s CONQUEST 1.0 database, also

available at the website, summarizes information on more than

1,000 clinical performance measures developed by public and 

private-sector organizations to examine the quality of clinical care.

Health Care Financing Administration (HCFA)

Office of Research and Demonstrations (ORD)

7500 Security Boulevard

Baltimore, MD 21244-1850

website: http://www.hcfa.gov

H C FA’s ORD has invested considerable energy in the development of

various types of risk-adjusters, and is exploring the development of

new risk adjustment mechanisms. HCFA’s website contains a 28-page

description of ORD’s activities as well as published articles from ORD.

National Library of Medicine (NLM)

National Information Center on Health Services Research and 

Health Care Technology (NICHSR)

8600 Rockville Pike

Building 38, Mail Stop 20

Bethesda, MD 20894

phone: 301/496-0176

fax: 301/402-3193

e-mail: nichsr@nlm.nih.gov

website: http://nlm.nih.gov/nichsr/nichsr.html

NICHSR was established to improve “the collection, storage, analysis,

retrieval and dissemination of information on health services research,

clinical practice guidelines and on health care technology, including the

assessment of such technology.” It coordinates the development of new

information products and services related to health services research

and maintains some useful databases, including:

■ HealthSTAR, an online bibliographic database that provides access

to literature on health services technology, administration and

research; 

15
16

■ HSRProj (Health Services Research Projects), a database of citations to research in progress funded by federal and foundation

grants and contracts;

■ HSTAT (Health Services/Technology Assessment Texts), a free

full-text electronic resource for clinical practice guidelines; and

■ DIRLINE (Director of Information Resources on LINE), an NLM

database of organizations that has a special subfile covering health

services research organizations.

Private Sector Groups

Kaiser Permanente Center for Health Research

Mark C. Hornbrook, Ph.D.

Program Director

3800 North Kaiser Center Drive

Portland, OR 97227-1098

phone: 503/335-6746

e-mail: hornbrookma@chr.mts.kpnw.org

Kaiser Permanente’s Center for Health Research (CHR) conducts a

program of research and demonstration projects on a broad range of

health and medical care issues. Although the CHR is professionally

independent, it is affiliated with the Northwest Division of Kaiser

Permanente, and uses this large operating medical care system as a

research setting and laboratory for answering health-related

research questions and for testing innovations in health care delivery and financing. The CHR has produced a significant body of work

on risk adjustment.

RAND

Health Sciences Program

Robert H. Brook, M.D., Sc.D., Director

1700 Main Street

Santa Monica, CA 90407

phone: 310/393-0411, ext. 7368

fax: 310/451-6917

website: www.rand.org/organization/drd/health

RAND conducts one of the largest private, not-for-profit programs of

health policy research and analysis in the world. The mission of this

program is to advance knowledge about how costs, quality and access

to care can be altered to promote a better health care system.

Among the areas in which the Health Sciences Program is conducting studies are: quality and appropriateness of care, health care

financing and delivery, health services research methods, mental

health, maternal and child health, care of the elderly, substance

abuse and HIV and AIDS.

State University of New York, School of Public Health

Ed Hannan, Ph.D., Professor and Chair

Department of Health Policy, Management and Behavior

1 University Place

Rensselaer, NY 12144

phone: 518/402-0333

fax: 518/402-0414

e-mail: ELH03@albanydh2.health.state.ny.us

Dr. Hannan has been involved in the development and use of clinical

databases for cardiac surgery, angioplasty and trauma care. These

databases have been used to identify risk factors related to mortality

and complications, to predict these adverse events and to assess

provider performance after adjusting for differences in patients’ 

preprocedural risk.
Appendix C: What are some examples of current

VA risk adjustment activities?

Listed below is a sampling of risk adjustment projects within VA.

The list is illustrative, rather than exhaustive. Contact information

is followed by a short summary of relevant activities.

VISTA Severity of Illness Index

Cincinnati VAMC

Marta L. Render, M.D.

phone: 513/475-6366

fax: 513/475-6409

e-mail: Render_Marta@Cincinnati.VA.GOV

This multi-center study is developing and evaluating a Severity 

Illness model to predict 60-day mortality in ICU patients using 

variables found in the Veterans Health Information Systems and

Technology Architecture (VISTA). The Severity Illness model will 

be a tool for administration and quality assurance.

The Veterans Health Study

Center for Health Quality, Outcomes and Economics Research

Bedford VAMC

Lewis E. Kazis, Sc.D.

phone and FTS: 781/687-2860

fax: 781/687-3106

This large-scale observational study of veterans in New England has

found that disease burden as measured in health status surveys

filled out by veterans is a good indicator of resource need. Information culled from these surveys may be used to develop risk profiles of

patients at the VISN and facility levels. These profiles may then be

used to make risk comparisons across VISNs and across facilities.

Hospital Length-of-Stay 

Center for Practice Management and Outcomes Research

Ann Arbor VAMC

Timothy Hofer, M.D.

phone: 313/930-5108

FTS: 313/930-5100

fax: 313/930-5159

email: thofer@umich.edu

The Ann Arbor HSR&D Center of Excellence produced annual riskadjusted length-of-stay profiles of VA hospitals for about six years.

Researchers are now shifting the focus of their efforts from inpatient

stays toward reporting on episodes of care.

The Utility of PTF Data in Monitoring Outcomes of 

Surgical Care

Center for Quality of Care and Utilization Studies

Houston VAMC

Nancy J. Petersen, Ph.D.

phone: 713/794-7713

fax: 713/794-7103

e-mail: petersen@bcm.tmc.edu

VA’s Patient Treatment File is an administrative database that provides the data for most of VA’s risk adjustment activities in inpatient

17
care. The Houston HSR&D Center of Excellence is evaluating the

PTF’s predictive powers compared with two models based on clinical

data. The researchers hope to produce a comprehensive analysis of

the strengths and weaknesses of the PTF with respect to risk adjustment, as well as specific information on how this data source may be

improved or enriched with clinical data.

Health Services Utilization and Survival in Nine Cohorts

Center for Quality of Care and Utilization Studies

Houston VAMC

Carol M. Ashton, M.D., M.P.H.

phone: 713/794-7351

FTS: 700/528-7615

fax: 713/794-7103

Investigators at the Houston HSR&D Center of Excellence are analyzing risk adjusted hospital and clinic utilization rates and survival

rates in nine disease cohorts of patients. Network-level and, in some

cases, hospital-level data have been analyzed for six consecutive fiscal years. Risk adjustment variables being used include patient

demographics, proxies for social support and physiologic reserve,

principal diagnosis within DRG, count of comorbidities, and body

systems affected by comorbid conditions.

Provider Profiling

Center for Quality of Care and Utilization Studies and the 

Northwest VA Network

Houston VAMC

Carol M. Ashton, M.D., M.P.H. and James Tuchschmidt, M.D.,

M.B.A.

phone: 713/794-7351

FTS: 700/528-7615

fax: 713/794-7103

Investigators at the Houston HSR&D Center of Excellence are working on the risk-adjustment aspects of the Northwest Network’s

provider profiling project, part of their Consumer Health Information

and Performance Set (CHIPS) program. Risk adjustment equations

are being evaluated and validated that take into account the influence

of patient age, gender, and disease burden on the provider-level

patient outcomes and utilization measures of interest to the network.

Pressure Ulcer Prevention and Treatment Improvement

Center for Health Quality, Outcomes and Economic Research

Bedford VAMC

Dan Berlowitz, M.D.

phone and FTS: 781/687-2962

fax: 781/687-3106

The Bedford HSR&D Center of Excellence has developed a risk

adjustment model using administrative data for the prediction of

pressure ulcer development among patients in long-term care facilities. This model became the foundation for a successful quality

improvement program that has lowered the rate of pressure ulcer

incidence.

18
Hospital Quality

Cleveland VAMC

Gary E. Rosenthal, M.D.

phone: 216/231-3262

fax: 216/231-3420

The Cleveland VAMC is using risk-adjusted data to produce the first

regional market-based analysis of the relative quality and efficiency

of care in a large VA hospital. This study will compare a wide range

of outcomes in a VA hospital and in private-sector hospitals serving

the same major metropolitan area. In another study, Cleveland

health services researchers are evaluating severity-adjusted mortality, patient perceptions of hospital quality and costs associated with

cardiac bypass surgery in VA and private-sector hospitals. 

Early Readmission Rates

Houston Center for Quality of Care and Utilization Studies

Houston VAMC

Nancy J. Petersen, Ph.D.

phone: 713/794-7713

fax: 713/794-7103

e-mail: petersen@bcm.tmc.edu

Researchers at the Houston HSR&D Center of Excellence have

developed a methodology using variables available in administrative

databases to predict unplanned hospital readmissions. The goal is to

use this model to identify hospitals with quality-of-care problems. 

AIDS/HIV

Houston Center for Quality of Care and Utilization Studies

Houston VAMC

Linda Rabeneck, M.D., M.P.H. 

phone: 713/794-7345 or 794-7719

fax: 713/790-1040

The Houston HSR&D Center of Excellence has developed two illness

severity systems that predict progression to AIDS in HIV-infected

patients, and a third system that predicts survival in AIDS patients.

These systems were based on relatively few variables, for which the

data are readily available in clinical practice settings. 

Chronic Disease

Center for Health Quality, Outcomes and Economic Research

Bedford VAMC

Dan R. Berlowitz, M.D.

phone and FTS: 781/687-2962

fax: 781/687-3106

e-mail: dberlow@bu.edu

Amy K. Rosen, Ph.D.

phone: 781/687-2960

fax: 781/687-3106

e-mail: akrosen@bu.edu

This program identified predictors of poor outcomes among patients

with hypertension, diabetes and chronic obstructive pulmonary 

disease. Project researchers are now using risk-adjusted diagnostic

information from VA databases to try to predict resource utilization

in outpatient settings. 

19
The National VA Surgical Quality Improvement Program

Brockton/West Roxbury VAMC and Hines VAMC

Jeanette Spenser, R.N., M.S., C.S., National Coordinator

phone: 617/323-7700, ext. 6738/6740

FTS: 700/885-6738

fax: 617/363-5567

e-mail: spenser.jeanette@brockton.va.gov

William G. Henderson, Ph.D.

Chief, CSPCC, Hines, IL

phone: 708/343-7200 x5853

FTS: 700/381-5853

fax: 708/216-2116

email: henderson@research.hines.med.va.gov

Continuous collection and analysis of valid information about surgical practice and outcomes within VHA are critical for monitoring

and improving the quality of care in all VAMCs. The NSQIP produces risk-adjusted data for specific surgical interventions that are

used to measure surgical outcomes and achieve substantive clinical

improvement at the local level.

The National Customer Feedback Center (NCFC)

Brockton/West Roxbury VAMC

Eileen Tarsky, R.N.D., Director

phone: 617/323-7700, ext. 5538

FTS: 700/885-5538

fax: 617/363-5539

The NCFC surveys inpatients and outpatients annually, collecting

data on patients’ perceptions of care continuity and coordination,

access to needed services, waiting times and whether the care they

received met their expectations. These measures are risk-adjusted

using several variables, including age and sex. This and other information forms the basis of VHA’s customer service standards. The

NCFC provides each VA medical center with information about how

well each medical center compares with its peers.

The Center for Continuous Quality Improvement in 

Cardiac Surgery (CCQICS)

Denver VAMC

Karl E. Hammermeister, M.D.

phone: 303/399-8020, ext. 2826

FTS: 700/322-2826

fax:303/393-4694

email: khammer@sembilan.uchsc.edu

The CCQICS has done considerable work in the calculation and

analysis of risk-adjusted outcomes among cardiac surgery patients.

Researchers have estimated the relative risk of death for numerous

patient-specific factors. This work is now being applied to clinical

decision making through continuous feedback of quality improvement data to cardiothoracic surgeons and cardiologists, and overall

mortality has declined significantly. The Center is now investigating

how the organization and processes of cardiac services units affect

outcomes of open heart surgery for atherosclerotic cardiovascular

disease. 

20
21

Decision Support System (DSS)

Bedford VAMC

Howard H. Green, M.D., Deputy Director for Technical 

Implementation

phone and FTS: 781/275-9175, ext. 111

fax: 781/275-9829

email: howard.h.green.md@med.va.gov

Elisabeth McSherry, M.D., M.P.H., Deputy Director for Data Systems

phone and FTS: 781/275-9175, ext. 107

fax: 781/275-5416

email: Elisabeth.mcsherry@med.va.gov

DSS is a commercial software product that VA is implementing to

help manage quality and costs. It may be used alone to determine

risk, or it may be used in conjunction with other risk adjustment

methods. DSS is a patient-focused program that can translate

patient risk into an alpha-numeric code and tag each patient with a

specific risk code. It can do the same with outcome codes. In this

way, patients may be sorted and grouped by risk and outcome and

associated costs. The product is meant to be used by hospital managers. Implementation is underway; ultimately, DSS will serve as

VA’s principal clinical management, budgeting and planning system.
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