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The HCC Coding Specialist: Benefiting payers, providers, and patients

The HCC Coding Specialist: Benefiting payers, providers, and patients


Hierarchical condition category (HCC) coding is a risk-adjustment model that is becoming increasingly prevalent as the environment shifts to value-based payment models. The objective of this model is estimate future healthcare costs for patients.

HCC relies on ICD-10 coding to assign patients’ risk values (RAF scores). Insurance companies use HCC coding to assign patients a risk adjustment factor (RAF) score. With these value or weighted score, insurance providers can attempt to predict healthcare costs for patients. So, why is HCC coding important for patient and providers? And how can the HCC coding specialist contribute to benefiting patient quality scores, higher shared saving, and an improved patient experience?

Why is HCC coding important?

Hierarchical condition category coding helps communicate patient complexity and paint a picture of the patient as a whole. In addition to helping predict health care resource utilization, RAF scores are used to risk adjust quality and cost metrics. By accounting for difference in patient complexity, quality and cost performance can be more appropriately measured.

As the RAF increases, so does the capitation payment for that beneficiary. It also affects the Medicaid managed care payers and Affordable Care Act (ACA) plans by providing them consistent and proper diagnosis documentation on their Medicare Advantage members.

How can an HCC Coding Specialist help patients?

Correct coding under risk adjustment models is necessary to properly identify risk and enhance collective savings. As mentioned before, these RAF scores can create a significant adjustment in the coverage amount for the Medicare patient in the following year. When charts are coded accurately, HCCs that impact the patient’s risk adjustment score are properly identified, resulting in a positive impact on overall patient quality scores, clinical care and patient experience.

Why HCCs matter to providers?

The increase in adoption of value-based care models by providers has had a direct impact on physicians’ incomes. Higher risk scores for a population translate into a higher benchmark for costs, while the same relation applies to lower risk scores. This is why having an accurate and standardized risk score is necessary for accomplishing higher savings.

Mari Cely

Director, Business Strategy & Marketing
HCC Coding

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