The Centers for Medicare and Medicaid Services (CMS) changed the Hierarchical Condition Category (HCC) risk adjustment model with its newest update called CMS-HCC Version 28 (V28). This update will start between 2024 and 2026. It will affect how Medicare Advantage Organizations (MAOs) and healthcare providers across the U.S. document, code, and manage patient risk in Medicare Advantage payment systems.
Healthcare organizations and medical practices need to plan and change how they work to handle these updates well. This article explains the main points of CMS-HCC V28 and gives strategies for healthcare managers, practice owners, and IT professionals. These ideas can help them manage risk better and keep finances steady.
CMS-HCC V28 changes how risk scores are figured for Medicare Advantage patients. It changes the way ICD-10-CM diagnosis codes are linked to HCCs. The number of diagnosis codes linked to payment categories dropped from 9,797 in Version 24 (V24) to 7,770 in V28. At the same time, HCC categories grew from 86 to 115. These changes aim to show healthcare use, costs, and diagnosis patterns more accurately, based on 2018 diagnoses and 2019 cost data.
Because of these updates, average Risk Adjustment Factor (RAF) scores are expected to drop by about 3.12% starting in 2024. This change is expected to save $11 billion for the Medicare Trust Fund. While this helps federal funds last longer, it brings money and work challenges for health plans and providers who count on correct RAF payments to manage patient care.
One big change is “constraining” related HCCs. Conditions like complicated and simple diabetes now share the same risk number. This lowers risk scores for some long-term illnesses even if the patients’ health has not changed.
V28 also adds more detailed coding for diseases like dementia. It splits dementia into severe, moderate, mild, or unspecified, each with a different RAF score. But, taking away over 2,000 ICD-10-CM codes from payment lists can cause loss of income. This risk is bigger if organizations do not improve coding accuracy and documentation.
Fewer Diagnosis Codes and Changed HCC Categories: Losing many diagnosis codes means organizations must make sure clinical notes are very clear and backed by proof. Doctors and staff will need more training and new work steps.
Lower RAF Scores Even if Patients are the Same: Due to code changes, many places will see lower RAF scores even if patients’ health has not changed. This makes it hard to predict income.
Mixed Coding During Changeover: From 2024 to 2026, organizations must use both V24 and V28 codes. Managing two systems needs smart tracking and analyzing to keep records correct and legal.
Bigger Audit Checks: More strict Risk Adjustment Data Validation (RADV) audits will happen. Providers must improve notes and coding to avoid penalties.
Effects on Chronic Disease Care: Diseases like diabetes and dementia have new codes and scoring. This means better testing and notes are needed to show true patient health.
These problems need teamwork among managers, doctors, and technology support.
Clear and exact clinical notes are key to handling V28 well. Clinic leaders and providers should train doctors to note detailed diagnoses and disease severity, especially for long-term diseases like diabetes and dementia.
For instance, dementia must be coded as severe, moderate, or mild/unspecified under V28. Each level has a different RAF score, such as 0.341 for severe dementia. Detecting dementia early and clearly can affect payments and care plans. Providers should change workflows to check and record brain health more often.
Training should help doctors learn the new ICD-10-CM coding rules. They should write notes that match codes used in V28. Clinics might also add form templates or reminders in electronic health records (EHRs) to keep notes detailed enough.
Health organizations need regular checks to compare patient health with RAF scores. Experts say analyzing patient types will help find which groups will be affected positively or negatively by V28.
Using data tools, providers can sort patients by risk and disease type. This helps predict money effects and change care plans. Comparing old RAF scores from V24 to new or actual V28 scores helps with good budgeting and planning.
CMS requires a mix of risk scores during the change: in 2024, 67% will be V24 and 33% V28; in 2025, 33% V24 and 67% V28; in 2026, fully V28. Managing this means having systems and staff who understand both coding sets.
Leaders must train coders and clinical staff on both versions. Data tools should support reports on both. This lowers legal and data risks while the new system is being used. Some staff or teams should watch over this work to keep data correct.
Because V28 needs more detailed clinical notes, regular training is needed for coders, doctors, and auditors. Joining coding groups, attending workshops, and online courses will keep staff up to date on coding and documentation rules.
Keeping knowledge fresh helps avoid mistakes and missing diagnoses. Training should also cover compliance for tougher RADV audits under V28.
Practice managers should build good communication with Medicare Advantage groups and health plans. Sharing info on coding trends, audits, and risk strategies helps everyone code the same way and follow rules during care changes.
Healthcare groups can also join benchmarking networks or quality groups to share adaptation ideas and data.
V28 adds complexity and more paperwork. Doing this by hand is slow and mistakes happen. Technology can help make risk adjustment work smoother and more accurate.
AI tools using natural language processing can find important diagnosis info automatically from medical records. These help catch HCC codes correctly and lower mistakes from missing notes.
For example, RAAPID uses AI, machine learning, NLP, and knowledge charts to help find chronic diseases and calculate risk scores. These tools support correct HCC coding even if documents are large or complex.
Automation tools help coders by suggesting likely diagnosis codes from notes and pointing out areas needing a second look. This speeds up coding and claim submissions for faster payments.
When linked to EHR systems, automation can check notes right away and find missing info, so doctors can fix notes before finishing patient visits.
Strong analytics tools let practices watch RAF scores, see patient group trends, and predict money effects from V28. Continuous reports help leaders find under-coded conditions, weak notes, and chances to improve coding.
Predictive analytics also help plan where to put resources and focus patient outreach, which fits with value-based care models.
Apps like Creyos Health offer detailed brain health tests following DSM-5 rules. These tools help spot and classify dementia better. That makes V28 coding more correct.
Better early testing helps care plans and raises risk adjustment income by matching dementia coding categories correctly.
Since RADV audits are expected to get tougher, organizations gain from tools that document coding choices, keep audit trails, and help with internal reviews. These systems enforce coding rules and make audit prep easier.
Staff Training: Make sure clinical and coding teams know new HCC categories, code changes, and documentation rules.
Technology Upgrades: Use AI-coded and data platforms to improve accuracy, speed, and rule-following.
Data-Based Case Mix Checks: Use tools to compare health and predict money effects. Change care plans when needed.
Team Involvement: Include clinical and administrative staff to track how V28 changes affect the organization.
Workflow Updates: Change note-taking and coding steps to fit new detailed codes and dual coding during the transition.
By using these ideas, healthcare groups in the U.S. will handle finances better, improve patient care, and meet CMS rules under the new CMS-HCC V28 risk adjustment model.
This article shares key strategies and technology ideas for medical practice leaders, healthcare owners, and IT staff to manage the CMS-HCC V28 period well. Paying attention to note quality, using automation, and training staff will help U.S. healthcare groups meet the needs of this important update for Medicare Advantage payments and risk management.
RAF scores are used by CMS to estimate the costs associated with Medicare Advantage beneficiaries. The score influences the payment amount per beneficiary, reflecting health conditions and severity.
RAF scores are calculated using demographic data (like age and sex) and disease risk scores based on reported diagnoses and corresponding HCC codes.
Version 28 introduces changes to HCC code structures, mappings, and coefficient values, impacting how RAF scores are determined.
Inaccurate coding can lead to lower RAF scores, indicating potential gaps in patient care or incomplete patient records.
The proposed changes in V28 are expected to decrease average RAF scores by approximately 3.12%, which equates to about $11 billion in savings for the Medicare Trust fund.
Constraining involves assigning the same coefficient values to related HCCs, which can unify risk scoring despite variations in health complexity among patients.
Investing in technologies like AI and clinical NLP helps improve the accuracy and efficiency of coding large volumes of clinical documents, which is crucial for managing risk adjustments.
Despite the complexity of conditions like diabetes, V28’s changes are likely to decrease RAF scores, which can affect funding for care for patients with multiple chronic conditions.
The overall effect of V28 on RAF scores will depend on various factors, including the organizations’ case mix and how these changes positively or negatively apply.
Organizations should benchmark current member health statuses, analyze the upcoming changes, and ensure they are equipped with the necessary technologies for effective risk adjustment.
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