Charles Yang, Ph.D., associate professor of finance and Kaye Family Research Fellow in Insurance at Florida Atlantic University’s College of Business, is being honored by the Society of Actuaries with its North American Actuarial Journal Annual Prize for an article analyzing Medicare Advantage and Accountable Care Organizations (ACOs).
Yang and his co-authors, Patrick Brockett and Linda Golden of the University of Texas’ McCombs School of Business, were also invited to present their research on Medicare savings and Data Envelopment Analysis (DEA) approaches to Medicare cost efficiency at the 2019 health meeting of the Society of Actuaries, the world’s largest actuarial professional organization.
Medicare is one of the largest health insurance programs in the world, providing nearly universal health insurance to the elderly and many disabled, and it creates a significant impact on healthcare and the economy. Medicare faces serious financial challenges because of rising overall health care costs. The 2010 Affordable Care Act includes a number of provisions to reform and refine Medicare to reduce expenditures while preserving or enhancing the quality of care.
The purpose of the research by Yang, Brockett and Golden is to apply DEA models to assess the potential savings of Medicare obtainable through an efficiency analysis of ACOs and Medicare Advantage plans with a focus on minimizing costs for the health service provision subject to expanding availability and utilization outputs.
DEA efficiency comparisons across plans achieves this purpose by identifying which Medicare plans operate more efficiently and which are inefficient, and, for inefficient plans, DEA analysis generates target levels of inputs and outputs required to bring the plan into efficient operation. Their article, “Potential ‘Savings’ of Medicare: The Analysis of Medicare Advantage and Accountable Care Organizations (ACOs),” provides important insights to Medicare reform, such as Medicare privatization and innovation models.
“We are much honored to be recognized by the world’s largest, most prestigious actuarial professional organization,” Yang said. “Health care reform is an ongoing innovative endeavor. It is a shared responsibility of all the stakeholders to help achieve the overarching triple aims of health care: better care, better health and lower costs. It is exciting that our research would inform policymakers, regulators, the insurance industry and the public on efficiency improvement and cost savings while preserving the quality of care.”
Recently, Yang has been working on various topical issues on health insurance and health care reform, including Medicaid quality of care, Medicare health outcomes, the Affordable Care Act individual markets, interstate health insurance markets and association health plans. Over the last five years, the FAU College of Business ranks No. 9 in actuarial science research among North American business schools, based on Yang’s publications in the top actuarial science journals.