What is Medicare risk adjustment coding?

Asked by: Cecilia Lind  |  Last update: February 16, 2025
Score: 4.1/5 (60 votes)

Risk adjustment is a methodology that equates the health status of a person to a number, called a risk score, to predict healthcare costs. The “risk” to a health plan insuring members with expected high healthcare use is “adjusted” by also insuring members with anticipated lower healthcare costs.

What does Medicare risk adjustment mean?

CMS uses the risk adjustment process to ensure Medicare Advantage functions effectively by paying more for enrollees who are expected to cost more to take care of and paying less for healthier enrollees.

What is risk adjustment in coding?

Risk Adjustment: A way to calculate what to pay a health provider based on a patient's health, their likely use of health care services and the costs of those services.

What is the purpose of collecting diagnosis in risk adjustment coding?

What is the purpose of collecting diagnoses in risk adjustment coding? To convert the diagnosis codes to a risk adjustment factor.

What is Medicare HCC coding?

HCCs, or Hierarchical Condition Categories, are sets of medical codes that are linked to specific clinical diagnoses. Since 2004, HCCs have been used by the Centers for Medicare and Medicaid Services (CMS) as part of a risk- adjustment model that identifies individuals with serious acute or chronic conditions.

What is HCC Coding - Risk Adjustment Medical Coding & CRC Credential Explained

32 related questions found

What is the difference between medical coding and HCC coding?

Hierarchical condition category (HCC) coding is a type of code used specifically for the medical billing of Medicare and Medicaid. It is considered a form of medical coding, and there is considerable overlap between HCC coding jobs and medical coding jobs.

What is a list of HCC diagnoses?

Top 10 Most Common HCC Codes
  • Diabetes without Complication (HCC 19)
  • Breast, Prostate, and Other Cancers and Tumors (HCC 12)
  • Diabetes with Chronic Complications (HCC 18)
  • Seizure Disorders and Convulsions (HCC 79)
  • Specified Heart Arrhythmias (HCC 96)
  • Congestive Heart Failure (HCC 85)

What does risk adjustment coding emphasize?

In contrast, risk adjustment coding emphasizes not only the chief complaint but also the patient's chronic conditions because they affect the patient's overall health status, resource requirements, and clinician's decision-making surrounding the chief complaint.

What does HCC mean after a diagnosis?

What is hierarchical condition category (HCC) coding? Hierarchical condition category (HCC) coding is a risk-adjustment model originally designed to estimate future health care costs for patients.

Which elements are considered in the Medicare HCC model?

Both HCC models use the same risk-adjusted characteristics like age, demographics, gender, and medical conditions. However, the CMS-HCC model uses institutional status while the HHS-HCC model uses financial status to predict healthcare spending.

What is the difference between risk adjustment and HCC?

Risk adjustment alters the cost of healthcare coverage based on a patient's health status. The payments are adjusted according to the patient's age, disability, financial status, and diagnoses. Hierarchical condition category (HCC) codes leverage ICD-10 codes to document those health statuses.

Is risk adjustment coding hard?

HCC coding for risk adjustment programs is a complex, labor-intensive process. There are a variety of factors that introduce opportunities for overlooked information, incorrect codes, and inconsistencies. A few of the leading factors that cause errors are: Large volumes of data.

What skills do you need for risk adjustment coding?

What are the most important Risk Adjustment Coder job skills to have on my resume? The most common important skills required by employers are CMS, Chronic Condition, Detail Oriented, Documentation, Compliance, Medical Coding and Accuracy.

What do risk adjustment coders do?

As a remote risk adjustment coder, your duties and responsibilities involve performing medical coding and reviewing medical codes for adherence to risk adjustment models. Employers may also expect you to audit medical record data to ensure accuracy.

How is the Medicare risk adjustment calculated?

Risk (RAF) score calculation: Medicare risk adjustment uses the CMS-HCC crosswalk to calculate a member's annual risk score based on chronic and severe acute conditions that are expected to impact healthcare costs long term.

What is the goal when coding for risk adjustment purposes?

In short, risk adjustment coding is a way for healthcare organizations and insurance companies to make sure they're accurately accounting for the health status of their patients, and adjusting payments accordingly.

Why is HCC coding important?

Each category is assigned a certain score, known as the Risk Adjustment Factor (RAF) score, which determines the level of reimbursement payments to healthcare providers. Accurate HCC coding is crucial to determining the level of reimbursement to compensate for the complexity of care delivered.

What is risk adjustment?

A statistical process that takes into account the underlying health status and health spending of the enrollees in an insurance plan when looking at their health care outcomes or health care costs.

What are the stages of HCC at diagnosis?

There are different staging systems used in cancer medicine. In HCC, doctors usually use the Barcelona Clinic Liver Cancer (BCLC) staging system. People with cancer often talk about their cancer being stage 1 to stage 4. This number staging is widely used for other types of cancer but not so often for HCC.

What is a Medicare risk adjustment review?

The Medicare Advantage (MA) Risk Adjustment Data Validation (RADV) program is CMS' primary way to address overpayments to Medicare Advantage Organizations (MAOs). During a MA RADV audit, CMS confirms that any diagnoses submitted by an MAO for risk adjustment are supported in the enrollees' medical records.

What is the purpose of collecting diagnosis and risk adjustment coding?

The goal of risk adjustment has always been to collect data on patients so that money being allocated could plan for not only the current diagnoses, but to allow for a model where that value is increased in correlation with the increasing costs of caring for patients with manifestations or complications of those known ...

What are some of the most common chronic conditions coded in risk adjustment?

Some of the most common HCC codes include:
  • Diabetes (HCC 17-19)
  • Chronic Kidney Disease (CKD) (HCC 134)
  • Chronic Obstructive Pulmonary Disease (COPD) (HCC 111)
  • Congestive Heart Failure (CHF) (HCC 85)
  • Cancers (Various HCCs)

What is a HCC diagnosis for Medicare?

HCCs, or Hierarchical Condition Categories, are sets of medical codes that are linked to specific clinical diagnoses. Since 2004, HCCs have been used by the Centers for Medicare and Medicaid Services (CMS) as part of a risk-adjustment model that identifies individuals with serious acute or chronic conditions.

What is the most common cause for HCC?

Chronic hepatitis B virus infection is the leading cause of HCC worldwide. Universal hepatitis B vaccination is likely to decrease the incidence of HCC worldwide. Five-year survival of HCC is 18% and second to pancreatic cancer.

What are the criteria for diagnosis of HCC?

AFP >400–500 ng/ml is considered diagnostic for HCC, although fewer than half of patients may generate levels that high 39. With values of that magnitude, the specificity of AFP is close to 100% but at a cost to the sensitivity which falls below 45% 40.