Profile of medical charges for children by health status group and severity level in a Washington State health plan

Objective. To identify children and evaluate patterns of charges for pediatric medical care, by overall health status, severity of illness, and categories of medical service. Data Sources. Enrollment, claims, and charges data from a Washington State health plan. The study population includes all children ages 0 to 18 years during calendar year 1999. Study Design. Children were classified into clinically defined health status groups and severity levels using Clinical Risk Groups (CRGs). Health plan charges were analyzed according to core health status group, severity level, and category of service. Data Collection. The three secondary data sources were obtained electronically from the health plan and cleaned for unique members and data quality before analysis. Principal Findings. Children classified as healthy (85.2 percent) had mean and median annual charges of $485 and $191. Children with one or more chronic conditions (9.5 percent) had mean and median charges increasing by status and severity group from $2,303 to $76,143 and from $1,151 to $19,456, and accounted for 45.2 percent of all charges. Distribution of charges varied across health status groups. Healthy children had 70.6 percent of their charges in outpatient and physician services. Children classified in the complex, catastrophic, and malignancy groups had 67 percent of their charges in inpatient encounters. Children with chronic conditions accounted for 31.8 percent of all physician, 41.8 percent of outpatient, 47.7 percent of pharmacy, 60.7 percent of inpatient, and 75.8 percent of all other charges. Conclusions. Children with chronic conditions account for a disproportionately high percentage of children's health expenditures. They account for different percentages of expenses for different medical services. These percentages vary according to health status and severity. This analysis can be used to identify and track groups of children for various purposes.