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HCC Coding

Hierarchical condition category coding helps predict risk and healthcare utilization

Hierarchical Condition Category (HCC) coding and Risk Adjustment are part of the payment model which has been mandated by The Centers for Medicare and Medicaid Services (CMS) to calculate risk scores. This model ranks a patient’s diagnosis into categories that represent conditions with similar cost patterns. 

Higher categories – long-term conditions such as diabetes, chronic obstructive pulmonary disease (COPD), chronic heart failure (CHF) – are measured using health status in a “base year” to predict costs in the following year. This type of predictability is not available for acute conditions, but is essential for projecting CMS expenditures. To factor in risk adjustment, a diagnosis must be based on clinical medical record documentation from a face-to-face encounter, documented at least once per year. Applying the CMS-HCC risk adjustment takes experience and expertise in coding according to ICD-10 guidelines.

ERCM’s team can help establish each patient’s predicted risk level

This is invaluable information for Medicare Advantage (MA) plans and those who administer them. EqualizeRCM has highly knowledgeable coders who can quickly define a patient’s disability or age status, their gender, age and other geographical and socio-economic data to help predict future costs. 

Different patients may have different payment rates, based on a predicted level of risk (e.g., the expected cost to maintain the patient’s health). Ideally, this allows CMS to reimburse plans based on the actual costs of care for each individual beneficiary, rather than to apply an “average” per-capita payment for all beneficiaries.

Risk score prediction, let us help

This intensive risk calculation takes a special level of expertise. We know it’s difficult and we know that our team is equal to the task. If you need help with HCC modeling, just ask EqualizeRCM. We’ve got your back.