Skip to content
Subscriber Only
Peter R. Orszag and Tim Ferris

We Already Have Health-Risk Scores. Now Let's Use Them.

One good way to improve insurance and strengthen the Obamacare exchanges.
Better data make better scores.

Better data make better scores.

Photographer: Kiyoshi Ota/Bloomberg

Most Americans know they have a personal credit score, and many know where to find it. Few know they also have a personal health-risk score. If these were better known, and better constructed, health insurance markets in the U.S. would work more smoothly.

Commercial health insurance plans, as well as Medicare, Medicaid and other government programs, generate risk scores every year for most of the people they cover. These scores are estimates of each person’s cost of care, compared with the average costs in a large population. And they play a big role in health insurance; they’re often used, for example, to determine how much more insurers are paid for sicker beneficiaries.