Hierarchical Condition Category (HCC) coding is an
adjustment tool that is used to calculate risk scores and to predict future
health costs for populations. CMS talks about risk adjustments associating
practices, or they use Tax Identification Numbers or TINs, to describe
providers that my deliver care to populations that are now well and other TINs
that provide care to those populations that are more well than others.
The critical element of this measurement is the ratio of
actual-to-expected performance and then taking into account the National
Average. This measurement can take two providers and measure the performance of
the two based on clinical complexity. CMS takes an example of one practice
treating a very sick population that has higher costs. When you look to compare
a provider of a healthy population to this one who treats a sicker population,
the one treating the sicker population looks like they may not be as efficient.
However, if you compare the practice that is treating a sicker population to
another same or similar practice, you may find that they are actually more
efficient and have much lower costs than the other practice treating the same
population type.
Some of the measures that are looked at in the risk
adjustment are as follows:
30-day All-Cause Hospital
Readmission Measure
Calculates the percentage of
qualifying hospital admissions that result in unplanned readmissions within 30
days of discharge
Hospital admissions for Acute and
Chronic ACSC Composite measures
Represents distinct conditions for
hospital admissions are potentially avoidable with using the services of
ambulatory care delivery options
Per Capita Costs for all
attributed beneficiaries and per capita costs for beneficiaries with specific
conditions
Calculates per capita costs
through HCC and generates a risk score that identifies potential per capita
costs attributed to the beneficiaries measured
MSPB measure
A measurement of Part A and Part B
total expenditures before, during, and after a qualified hospital stay
Consumer Assessment of Healthcare
Providers (CAHPS) for Physician Quality Reporting System (PQRS) measures
CMS uses other data for
measurement such as age, education, overall health and mental health indicators
This process takes into account several methodologies, but
the one that stands out is expected performance vs. actual performance.
Overall, HCC coding has a great many variables both in the
provider scope and the population served. A good Healthcare Administrator that
is working in the primary practice arena or Accountable Care Organizations will
need to familiarize themselves with the HCC coding concepts and how they may
impact your facility and the population that is served. Not monitoring this
process can cost the practice or ACO a considerable amount of resources without
adequate measures to recoup costs.
Submitted by Kevin Harrington, MATS, MSHA, RHIA, CHP
Assistant Program Director, Health Administration, Saint Joseph's College
