Risk Scoring and Population Risk Adjustments

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By now, almost all healthcare providers have been affected by the shift to value-based care and are either working with or are aware of HCC coding.

It is practically impossible to participate in Medicare and not be subject to the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), the Consumer Assessment of Health Providers and Systems (CAHPS), or other programs that adjust payment based on quality and cost.

With this change, it can be difficult to manage the clinical documentation and diagnosis coding that impacts the population risk-adjustment factors that improve financial opportunity.

Unfortunately, most physicians and practice managers understand only part of the fee-for-value (FFV) equation. While they know the quality data they report to payers under FFV will affect their reimbursement, many do not understand exactly how payers use this data to adjust payment.

What is the missing piece of the equation? Patient risk scoring.

What is risk scoring?

Under many value-based payment models, payers adjust reimbursement to reflect the relative health or sickness of patients. These adjustments are meant to reflect expected costs, so they can have a big impact on payment. In fact, depending on what risk factors are present, appropriate risk scoring can double or triple per-patient reimbursement.

The challenge is that patient risk scoring is complex. It is easy for medical practices to under-report risk and, therefore, to miss out on full reimbursement. There are some crucial challenges they must confront in order to understand and properly utilize patient risk scoring.

The CMS HCC Model

CMS created the HCC model to capture diagnosis codes that better reflect individual patient risk for predicting future healthcare expenditures. The Medicare Shared Savings Program (MSSP) and Medicare Advantage use HCCs to help set financial benchmarks for budgetary performance. The best approach to capturing HCCs is a combination of provider education, technology, and patient engagement.

Capturing HCCs

Traditionally, medical record documentation was a way for providers to tell the patient’s story, communicate with other providers, and justify the evaluation and management (E&M) coding by capturing the time and complexity of the encounter. This worked well in fee-for-service (FFS) models. Now, with the focus shifting to FFV, providers need to also focus on capturing important elements about each condition and diagnosis, coding to the highest degree of specificity.

Certain specific ICD-10 codes will map to specific HCCs, which carry a risk adjustment factor for that patient. For chronic conditions, the chart documentation and ICD-10 coding needs to be completed each year to recapture the HCCs. Once providers are educated in this paradigm shift, the next phase is to support them through continued training and technology.

HCC capture and recapture

There are two very important ways that technology can support providers in capture and recapture of HCCs each year. Once an HCC has been established, it is usually subject to mining and analytics from either claims data or the EHR. Reminder systems can be put in place, so these patients are targeted each year for annual visits and HCC recapture.

Special care must be taken to not code for HCCs that were acute and where the condition no longer exists. In some cases, claims and EHR data may suggest a diagnosis that has yet to be documented that can map to an HCC. An example of this may be a patient with abnormal pulmonary function tests and who is taking long-acting respiratory medications but has yet to be diagnosed with chronic obstructive pulmonary disease (COPD). Analytics can help identify these patients for potential HCC capture.

Annual HCC capturing

Capturing HCCs on an annual basis requires a face-to-face visit with the patient. Annual preventive visits, “welcome to Medicare” exams, and annual wellness visits are good opportunities to capture your patients’ HCC conditions when they visit the office.

In addition to being a great opportunity to connect with patients, these visits are designed to encourage monitoring of physical and cognitive abilities. They also help with development of plans associated with decreasing the impact of increasing frailty on everyday life for seniors. These visits are of no cost to patients and meet CMS’s obligations.

As providers adjust to the impact of population risk adjustment, they can alleviate the danger of under-reporting risk and missing out on full reimbursement by implementing a comprehensive patient risk scoring model, confronting these crucial challenges effectively in the years ahead.

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Lucy Zielinski

By Lucy Zielinski

Lucy specializes in helping health systems and medical groups achieve top financial and operational performance through physician-hospital alignment, including clinically integrated networks, practice transformation, coding and revenue cycle improvement, and physician leadership programs.