How Does HCC Coding Work?

Hierarchical condition category coding, or HCC coding, is a risk adjustment model initially designed to estimate future patient healthcare costs.

The CMS HCC model was initiated in 2004 and is becoming increasingly prevalent as the environment shifts to value-based payment models.

HCC coding relies on mapping ICD ten codes to condition categories. Insurance companies use HCC coding and patient demographics to assign patients a risk adjustment factor score or RAV.

These RAV scores are then used to predict costs associated with caring for that patient. For example, a patient with few severe health conditions would be expected to have average medical costs for a given time. However, patients with multiple chronic conditions would be expected to have higher healthcare utilization and costs.

Why is HCC coding important?

Hierarchical condition category coding communicates the complexity of the patient. RAV scores are used to risk quality and cost metrics by accounting for differences in patient complexity.

Reminders for HCC coding. Risk adjustment scores reset every year. Practices must report active diagnoses annually, even chronic conditions and amputations.

HCCs are additive, so it is essential to code all conditions that coexist during the encounter or affect patient care or treatment.

Conditions that were previously treated and no longer assist should not be coded. History codes may be secondary codes if the condition or family history impacts current care or influences treatment.

Documentation must support the diagnoses reported.

Use the meet principle. The documentation for a diagnosis should include that the condition was monitored, evaluated, assessed, or treated, meet at the time of the encounter, or was directly impacting the care or treatment of the patient.

Does the documentation support the meet for each ICD ten code?

There are some things to consider when selecting the appropriate diagnosis code. Code to the highest level of specificity that is supported in the documentation and ensure the codes are properly sequenced.

Type and underlying cause: control status, severity, sight, location, or laterality. Associated comorbid conditions and substance use slash exposure.

The transition from risk adjustment model v24 to v28 began on January 1st 2024. The new model will be phased in over three years with a blend of the v28 model and v24 until fully phased in. Managing two versions of HCC models during the transition creates challenges for providers as conditions that are considered as HCC in one version may not be in the other.

How can ChartPath help your practice with HCC coding? By using our optional HCC feature, which includes enhanced search and history.

First, let's review the search feature:

We've included both versions of the HCC categories in our ICD tree.

When we click to the billing section in an encounter note for a practice that's using our HCC coding feature, and we scroll to our ICD ten tree, we can begin searching for the correct code using our problem from the assessment and plan.

Once the search result displays, if the ICD ten code is mapped to an HCC category, that ICD ten code will have a bold title, and then in the parenthesis to the right of the title, you will see the HCC category number as well as the version number. If a code maps to a category in both versions, both versions will display. If we click to search for codes related to constipation, you'll notice none of these are in bold font. That is because these codes do not map to an HCC category. If we search hypertension, we can see that essential hypertension is not a risk adjustment code. But code I eleven hypertensive heart disease with heart failure does risk adjust, and that code belongs to category 85 in version 24 and category 220 in version 28.

As you search for your patient's ICD ten codes, you can easily see if they risk adjust. And if it maps to one version or both versions and then displays the category number as well.

Now let's explore the HCC history feature:

Chartpath can help you capture your patient's complexity because the system will highlight diagnosis codes that were previously used but haven't been submitted on an encounter note in the past 365 days.

On patient Shirley Temple, you'll notice there is an HCC diagnosis box.

This field displays only HCC codes that were not used in the past three hundred and sixty five days.

For example, Alzheimer's disease in the fib hasn't been coded since February 28th 2023, so this history box displays as a reminder that this condition has not been billed in the 365 calendar days.

Remember, HCC conditions need to be coded at least once every year for that patient's risk score, even for chronic conditions and amputations. So again, if there are any gaps in a diagnosis history between last year and this year, those gaps will be displayed in this dedicated section.

When searching for the ICD ten codes, any risk-adjusted code will display with a bold title and include the HCC category and version.

Thanks for watching.

Hope this helps your coding.