The healthcare landscape is in a constant state of flux, and for those involved in Medicare Advantage plans, a significant change is on the horizon. The Department of Health and Human Services (HHS) announced on March 31, 2023, a monumental shift from Version 24 to Version 28 in the Medicare Advantage Hierarchical Condition Category (HCC) coding system. This transition is not just a minor update; it's a comprehensive overhaul set to roll out over three years, starting on January 1, 2024.
The Medicare Risk Adjustment Model is undergoing a significant transformation with the introduction of Version 28. This change aims to improve the Medicare Advantage plans by recalibrating the risk adjustment methodology. The estimated payment to these plans is expected to see an increase by 3.32%, a substantial rise compared to the initially proposed 1.03% and significantly lower than the 8% in FY2023.
- Renaming and Renumbering of HCCs: Version 28 undertakes a comprehensive renaming and renumbering process to improve clarity and organizational structure. This restructuring is designed to make the system more navigable for healthcare providers.
- Increase in Total Number of HCCs: The number of HCCs has been expanded from 86 in the previous version to 115 in Version 28. This increase includes new HCCs like HCC 35 Pancreas Transplant Status, which was not present in Version 24.
- Streamlining ICD-10-CM Codes: Version 28 reduces the number of ICD-10-CM codes designated as HCCs by approximately 2,000, making the risk adjustment process more streamlined.
- Changes in Coefficient Risk Adjustment Factors (RAF): The RAF values for specific conditions, like chronic hepatitis, have been updated. For example, the RAF for chronic hepatitis has changed from 0.147 in Version 24 to 0.185 in Version 28.
Managing two model versions simultaneously will be a complex task. Each version has its own set of HCC inclusions and RAF values, requiring healthcare providers to be extra vigilant. However, this also presents an opportunity for more accurate documentation, which can lead to more precise reimbursements.
The new model aims to mitigate the issue of upcoding, a practice that has led to inflated payments. Multiple audits have highlighted unsupported diagnoses, prompting CMS to refine the HCC model for greater accountability and transparency.
The transition from CMS-HCC Version 24 to Version 28 is a monumental shift that healthcare providers must navigate carefully over a three-year period. By understanding the nuances and intricacies of the new system, providers can ensure accurate reimbursements and contribute to a more efficient healthcare ecosystem
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