The final stretch: HCC year end reconciliation

Nov. 3, 2023 / By Keri Hunsaker

The end of year is typically the most critical time for managed care organizations and health care providers to reconcile hierarchical condition category (HCC) and risk adjusted factor (RAF) scores. For health care organizations, this can involve multiple stakeholders, including clinical professionals and physicians, documentation and coding specialists, compliance management and leadership partnering with managed care organizations. All have a common interest in ensuring the patient care provided is accurately documented with the appropriate HCC diagnosis code.

As risk-based contracts continue to be adopted, the reconciliation process for HCCs will need to be an efficient process. Missed HCCs could have the following implications:  

• Underpayment of actual care. If an HCC is missing supporting diagnosis, or even overlooked as part of the patient record, the patient’s risk score will not reflect the patient’s condition and care. 
• Missed care opportunities. HCCs and the patient’s risk score (RAF) should represent the patient’s health. Not having a full picture can lead to missed treatment of chronic conditions or under-representation of the patient population. 
• Quality metrics. Missed HCCs can misrepresent a health care organization’s quality metrics and its effectiveness, which will not accurately reflect the quality metrics for the organization. 
• Risk of audits and penalties. Although audits typically fall on the payer, health care providers are responsible for the accurate and compliant documentation, per regulations. Inaccurate audits can have consequences that fall to the physicians. 
• Patient care. Ultimately, health care is about the patient and the patient’s care. Accurate HCC coding and appropriate RAF scores reflect the care the patient receives. The patient’s record should reflect both the care provided and the patient’s overall health story to ensure appropriate health care. 

As noted above, missed HCCs can have financial and compliance consequences. The most efficient way in which to capture HCCs is using an integrated workflow, which leverages documentation specialists and coders, physicians, compliance/auditors and population health. An integrated workflow, especially when incorporating artificial intelligence (AI) and computer-assisted physician documentation (CAPD), can present patient conditions information prior to the patient visit, information presented during the physician and patient encounter within the physician’s workflow, and a post-visit audit process to ensure documentation and coding is compliant, with appropriate supportive evidence, prior to the claim being sent to the payer. 

When managed in real time, this process can lead to improved care, as the patient information is available during the patient visit. It can reduce the administrative burden for physicians, as they are not always comfortable with diagnostic codes, and minimize the rush to identify HCCs at the end of the year. 

Keri Hunsaker is a marketing manager at 3M Health Information Systems.

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