Area Deprivation Index (ADI)

Key facts

Maintained by

University of Wisconsin-Madison, through the Neighborhood Atlas

Geographic unit

Census block group

Inputs

17 indicators from American Community Survey 5-year estimates

Rankings

National percentile (1 to 100) and within-state decile (1 to 10)

Origin

Developed by Gopal Singh (2003) using 1990 census data

What is the Area Deprivation Index?

The Area Deprivation Index summarizes how socioeconomically disadvantaged a neighborhood is. It was first developed in 2003 by Gopal Singh, then at the Health Resources and Services Administration, using 1990 census data. Researchers at the University of Wisconsin-Madison later rebuilt it at the census block group level and publish it through the Neighborhood Atlas.

Higher ranks mean more disadvantage. Because the ADI is a rank, it shows where a neighborhood stands relative to others, not an absolute level of poverty.

How the ADI is built

The Neighborhood Atlas version works in three steps:

• Inputs: 17 indicators from American Community Survey 5-year estimates, covering income, poverty, education, employment, housing costs and housing quality.
• Scoring: the indicators are combined using weights derived from the original factor analysis.
• Ranking: block groups are ranked nationally into percentiles from 1 to 100 and within each state into deciles from 1 to 10.

How the ADI is used

The ADI is widely used in health services research to link neighborhood disadvantage to outcomes such as readmissions and mortality. CMS used it in the ACO REACH Model health equity benchmark adjustment, which raised spending benchmarks for organizations serving patients in more deprived neighborhoods. Health systems and payers use it to target outreach and social needs programs.

Limitations of the ADI

The Neighborhood Atlas cautions that the ADI is validated only at the block group level, and mapping it to ZIP codes, ZIP Code Tabulation Areas or census tracts is not a validated approach. Published critiques have argued that because the input variables are not standardized, dollar-based measures such as median home value dominate the index, which can understate deprivation in low-cost rural areas and overstate it in high-cost cities. The maintainers dispute parts of that critique, so analysts should test how their conclusions change with an alternative index.