Medical Risk Adjustment Toolkit

Medical Risk Adjustment Models

CENTERS FOR MEDICARE AND MEDICAID HIERARCHICAL CONDITION CATEGORY (CMS-HCC) MODEL

This model was originally based on reimbursement under Medicare Part C (Medicare Advantage) and Part D (drugs). This model is prospective in nature, meaning previous claims and EHR patient data is used to predict and review patient status for diagnoses for the following year. Currently, there are more than 70,000 ICD-10 diagnostic codes, with approximately 10,000 ICD-10 codes that map to an HCC. There are 86 HCC rankings and 15 distinct diagnostic categories under the current 2020-year reporting.5 The revised HCC model is evolving into phases over the
next few years to include an additional weighted bonus for having a higher number of chronic conditions. HCC values are determined by CMS and vary depending on disease burden (a cancer in remission vs. chronic disease status). Diagnostic data is captured by assessing claims with dates of service during the current calendar year and comparing it to previous years’ data.

 

Diagnoses Included:

  • High-cost medical conditions such as current cancer, heart disease or hip fracture, COPD, status amputation and diabetes
  • Highest weighted conditions such as HIV, sepsis, opportunistic infections or cancers.
  • Acute vs. chronic status codes, etiology (cause of disease) and manifestation (signs of illness).

Diagnoses Excluded:

  • Codes that do not predict future cost
    (appendicitis, for example).
  • When symptoms necessitate a high variability in coding.
  • Codes from lab, radiology, home health or other departments that may not be reliable.
DEPARTMENT OF HEALTH AND HUMAN SERVICES HIERARCHICAL CONDITION CATEGORY (HHS-HCC) MODEL

Originated in 2014, the HHS-HCC model is a concurrent model, meaning it uses diagnoses from a specific time period to predict cost in the same period. This model was developed
after the passage of the Affordable Care Act (ACA) to reimburse marketplace health plans for infants, children and all-age adult patient populations. Diagnostic data is captured by assessing claims with dates of service during the current calendar year.

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