Risk Adjustment
Hierarchical Condition Categories
(HCC Coding)
Payment Model
Provider Education Guide
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What is CMS’s Hierarchical Condition Categories?
• Medicare Risk Adjustment payment model introduced by the Centers for
Medicare and Medicaid (CMS) in 2004.
• The goal is to pay Medicare Advantage (MA) and Prescription Drug Plans
(PDPs) accurately and fairly by adjusting payment for Enrollees based on
their demographics and their health status.
• This Risk Adjustment payment model measures the disease burden that
includes 70 HCC categories, which are correlated to diagnosis codes.
• Accurate diagnosis code documentation (ICD-9 CM) and reporting now
determines reimbursement.
– 3,600 ICD-9 codes map to 1 of 70 HCCs (mostly chronic but some are
acute)
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Examples of Chronic Conditions
• The following HCCs reflect a few common chronic conditions found in
Medicare population, that Medicare Advantage Plans look for to be
documented in a patient’s chart:
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Diabetes without complications – HCC 19
Chronic Obstructive Pulmonary Disease – HCC 108
Congestive Heart Failure – HCC 80
Breast Cancer – HCC 10
Ischemic Heart Disease – HCC 92
Angina – HCC 83
• Diagnoses from the previous year are used to establish capitation payments
to the MA plan. HCCs must be captured every 12 months for CMS to
reimburse. Health Status is re-determined every year
• If the HCC codes are captured outside the12 months (e.g. 12 months and 4
days), it will generate a 6-month revenue gap for that MA plan.
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Data Collection
• It all boils down to the data collection process!
• Physicians who do not exercise good documentation at each
patient encounter will receive insufficient funding.
• Good documentation begins at the time of the patient’s faceto-face encounter with the physician.
• Document all clinical findings in the medical record (chart),
and the medical record is used to support ICD-9-CM and HCC
coding.
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Care is Delivered to the Member
(face-to-face encounter)
The Process
Care and Diagnoses are Documented
in the Chart / Progress Notes
ICD-9 CM codes are submitted on
Claims based on the face-to-face
encounter clinical findings
Plan & Providers can Deliver
better care
And reimbursement is received
Claims data diagnosis codes are
converted to HCC codes
CMS Calculates MA Risk
Adjustment
HCC codes data is submitted to CMS
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Document, Document, Document
• Is your documentation sufficient to fund the care for your sicker patients?
• The quality of diagnosis coding and supporting documentation must improve
in order to maintain the same reimbursement payments.
It All Begins with You!
Goal = Properly Reflect the Member’s Health Status
• Fully assess ALL Chronic Conditions ….…at least annually
• Thoroughly Document in the Chart (Progress Notes) ALL conditions evaluated
for each visit
• Code to the Highest Level of Specificity (fully utilize the ICD-9 Diagnosis
Coding System)
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Choosing Diagnosis Codes
• A joint effort between the health care provider and the coder
is essential to achieve complete and accurate documentation,
code assignment, and reporting of diagnoses and procedures.
• Annual code changes are implemented by the government
and are effective Oct 1 of every year and valid through Sept
30 of the following year.
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Diabetes Mellitus
• All important 4th digit
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250.00 no complication
250.10 ketoacidosis
250.20 hyperosmolarity
250.30 coma
250.40 renal manifestations
250.50 ophthalmological manifestation
250.60 neurological manifestations
250.70 peripheral circulatory disorders
250.80 other specified manifestations
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Diabetes Manifestations
• Use multiple coding techniques for compound diagnoses
• DM with a manifestation (complication) requires that you
document and code the manifestation as well.
• Peripheral Neuropathy due to DM
– 250.60 DM with Neurological manifestations
– 357.2 Peripheral Neuropathy in DM
• PVD due to DM
– 250.70 DM with peripheral circulatory disorders
– 443.81 PVD in diseases classified elsewhere
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ESRD - Coding
• When a patient is on dialysis it requires two codes
– 585.6 ESRD $2870
– V45.11 Renal Dialysis Status $10,522
• ESRD on hemodialysis due to Diabetes
– 250.40 Diabetes w/renal manifestations $3962
– 585.6 CKD stage VI (ESRD)
– V45.11 Renal dialysis status $10,522
– ** CKD hierarchs Nephropathy
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Documenting the diabetic connection
• Unclear whether “with” will be acceptable with CMS so
preferable way to make connection
– “Due to”
– “Secondary”
– “Diabetic”
• Examples:
– Peripheral Neuropathy due to DM
– CKD Stage III secondary to DM
– Diabetic Ulcer
– Diabetic Retinopathy
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Documenting the diabetic connection
• Coders are not allowed to assume a cause-and-effect relationship
• If you document like this:
– Assessment
• 1. Diabetes Type II
250.00 $1263
• 2. Peripheral Neuropathy
357.2 $2550
• 3. CKD Stage III
585.3 $2870
• These will be coded separately and the highest Diabetes HCC code will be
missed
• If you document like this, then the highest HCC in the diabetes will be
captured:
– Assessment
• 1. Diabetic peripheral neuropathy 250.60 & 357.2 $2550
• 2. CKD III due to Diabetes
250.40 $3962 & 585.3 $2870
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Ulcers-Non Pressure Vs. Pressure
• Two types of ulcers
– Non-pressure of chronic $3502
– Pressure or Decubitus $8993
• Pressure ulcer is a higher HCC than a non-pressure so it’s
important to code it correctly
– Stage I pressure ulcer of sacrum
• 707.03
• 707.21
– Diabetic ulcer on the calf
• 250.80 DM with other specified manisfestations
• 707.12 Ulcer of the calf
• **Wounds are not HCC’s
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Metastatic Cancer
• Mets is the highest HCC $17,753 – only if the site it has metastasized to is
documented
– H/O Breast Ca with Mets to lung
V10.3 & 197.0
– Prostate Ca on Lupron with bone Mets
185 & 198.82
– H/O Colon Ca with Mets to the liver
V10.05 & 197.7
• If you document like this the highest HCC opportunity will be missed
– Metastatic Breast Ca $1622 (if Breast ca is under treatment) 174.9 &
199.1
– Metastatic Colon Ca $1622 (if Colon ca is under treatment) 154.0 & 199.1
– Lung Ca with Mets $8213 (if Lung ca is under treatment) 162.9 & 199.1
– H/O Lung Ca with Mets $1622 V10.11 & 199.1
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Alcohol and Drug Dependence
• Alcohol dependence, Chronic alcoholism or Alcoholism in
remission 303.90 & 303.93
• Drug dependence or Drug dependence in remission
• (opiate, anxiolytic, sedative, hypnotic, hallucinogen, or
amphetamine) 304.90 & 304.93
• Patient has arrived at a stage of physical dependency and
would experience physical signs of withdrawal with sudden
cessation
• **Alcohol abuse and drug abuse are not HCCs! 305.xx
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Major Depression/Malnutrition
• Major depression 296.xx
– PHQ9 score > 10
– 5 of 9 DSMIV criteria
– Medication
– Following with a mental health provider
– **if only “Depression” 311 is documented…it is not an HCC code!
• Protein Calorie Malnutrition 263.x
– Commonly used indicators
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Albumin <3.4
10% unintentional weight loss in 3-6 mos
5% unintentional weight loss in 3-6 mos
BMI <18.5, especially with a co-morbidity
Poor nutrition or loss of appetite
Wasting appearance or muscle wasting
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Common Omissions Year over Year
• Artificial openings
– Gastrostomy
V44.1
– Colostomy
V44.3
– Tracheotomy
V44.0
– Ileostomy
V44.2
• Amputations
– BKA
V49.75
– AKA
V49.76
– Foot
V49.73
– Toe
V49.71 Great Toe or V49.72 Other Toes
• AAA – Abdominal aortic aneurysm 441.4 (w/o mention of rupture not
repair)
• Aortic Atherosclerosis 440.0
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Malfunctions / Complications
• Mechanical complication of device, implant or graft 996.xx
– Vascular, Nervous, Genitourinary, Internal orthopedic
• Infection/Inflammatory reaction due to internal device, implant or graft
996.xx
– Cardiac
– Vascular
– Nervous System
– Indwelling catheter
– Internal joint prosthesis, ortho or prosthetic device
• Other complications of device, implant or graft – occlusion, embolism,
fibrosis, hemorrhage, pain, stenosis, thrombus 996.xx
– Vascular device, implant or graft
– Nervous system device, implant or graft
– Genitourinary device, implant or graft
– Internal joint prosthesis
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Examples of how much it matters?
HCC Code
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HCC19
HCC18
HCC17
HCC16
HCC15
Annual
Reimbursement
250.00 Diabetes with no complications
$ 485
250.5x DM w/ ophthalmic manifestations $ 831
250.1X –3X DM w/ acute complications
$ 948
250.6x DM w neurologic manifestations
$1,338
250.4x DM w/ renal or peripheral
circulatory manifestations
$1,852
Note: Some categories have a hierarchy, such as Diabetes, in such
categories, only the highest HCC would “count”
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Risk Adjustment Coding Examples
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Specificity
• Don’t report this
If the pt really has
(Does not risk adjust)
311 Depression
493.90 Asthma
(Does risk adjust)
296.xx Major Depression
493.20 Chronic Obstructive Asthma
496 COPD/492.8 Emphysema
490 Bronchitis
491.9 Chronic Bronchitis
414.01 CAD
413.9 Angina 411.1 Unst Angina
427.89 Cardiac Dysrhythmias 427.31 Atrial Fibrillation
577.0 Chronic Pancreatitis
070.54 Chronic Pancreatitis
070.70 Hepatitis C
070.54 Chronic Hepatitis C
805.8 Fx of Vertebrae
733.13 Path FX of Vertebrae
434.91 CVA
438.20 Late Effects CVA w/ Hemiplegia
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“Additional Coding Examples”
Does NOT Risk Adjust:
Does Risk Adjust:
~401.0 Malignant Hypertension
~ 402.00 Hypertensive Heart
DX-Malignant w/o heart failure
~ 414.00 Coronary atherosclerosis
~ 413.9 Angina pectoris unspecified
~ 440.9 Atherosclerosis unspecified
~ 440.3X Atherosclerosis of by-pass
graft of extremities
~ 427.89 Other specified cardiac
dysrhythmia, other
~ 427.31 Atrial fibrillation
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Documentation Tips
• Don’t document “H/O” of any disease that currently exists.
– The statement “history of” in ICD-9 terms means that the patient no longer has this
condition. However, “H/O” is ok when documenting some status conditions such as
Amputation, Old MI or Cancer.
• Rule of thumb in coding is
– If a patient is on a medication for a condition and if the medication were to be stopped,
would the condition resume, and the answer is mostly likely or yes, then you still code
the condition.
• Examples
– H/O CHF – pt is on lasix 428.0
– H/O Angina – pt has nitroquick 413.9
– H/O COPD – pt is on Advair 496
– This also applies to a pacemaker for SSS or Complete or 3rd
degree heart attack..if the SSS or Heart Block is documented you
can still code it 427.81 or 426.0
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Treating, Managing or Assessing the
Chronic Conditions
• In order for CMS to make the payment to the health plan the diagnoses
submitted must be from a face-to-face visit and the visit must indicate how
the chronic conditions are being treated, managed or assessed
– Sample language
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Assessment
Stable
Improved
Tolerating meds
Deteriorating
Plan
Monitor
D/C meds
Continue meds
Refer
– Example: Hypertensive CKD III, stable well controlled, continue meds
– Example: COPD, stable on Advair
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Critical Success Factors – Coding Guidelines
• “Probable”, “suspected”, “questionable”, “R/O”, “versus”,
“working diagnosis”, “?”, “likely”, etc. CANNOT be coded!
• Code the condition to the highest degree of certainty for that
encounter/visit, such as symptoms, signs, abnormal test results,
or other reason for the visit.
• A medical record entry must
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Be legible
Support all diagnoses coded
Be complete and accurate
Have a provider signature and credentials
Identify the patient and date of service
Document the patient’s progress and results of treatment
Justify the treatment and level of care
Use only standard abbreviations and keep them to a minimum
Promote continuity of care among the healthcare providers
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Coding Guidelines
• Coded according to the ICD-9-CM Guidelines for Coding and Reporting;
assigned based on dates of service within the data collection period,
• Submitted to the MA organization from an appropriate risk adjustment
provider type and an appropriate risk adjustment physician data source.
• The medical record documentation must support an assigned HCC.
• All chronic conditions must be assessed and reported no less than once a
year… “If a patient is Diabetic, it must be in the chart every year”!
• All conditions must be documented in the medical record.
• Medical record must support codes reported on the claim or encounter
form.
• Provider should document and code to the highest level of specificity.
• Each diagnosis must have an assessment and a plan.
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Coding Guidelines
Which Medical Record(s) can be submitted for validation?
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Hospital Inpatient
Hospital Outpatient
Or Physician medical record when more than one option is available.
What must Providers report?
• All diagnoses (not just primary diagnosis) that impact the patient’s
evaluation, care, and treatment including:
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Main reason for visit,
Co-existing acute conditions,
Chronic conditions (such as A Fib, CHF, CKD, RA, DM, COPD/Asthma, Cardiomyopathy),
Care rendered,
Conclusion and diagnosis,
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Additional Coding Guidelines
• Incomplete Inpatient Records
– Discharge summary
• Valid IP record for coding if it has both the admit and discharge dates
• Use Inpatient Coding guidelines to code
– Admission history and physical not valid for IP record
coding
– Consults during the inpatient stay may be coded as
physician records
• Use Inpatient Coding guidelines to code
– ER visit on the same date as admission date can be coded
as an outpatient visit
• Use Inpatient Coding Guidelines to code
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Example of Good Documentation
Chief Complaint
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S: Voices no complaint except that she wishes she could visit her sister, who is hospitalized. States she is
able to get around, including bathroom and cafeteria, without difficulty. Denies any pain or shortness of
breath. No change in bowel or bladder habits.
O: Patient alert, oriented to person, disoriented to place and time. No acute distress.
Cardiac: RRR no rubs, gallops or murmurs noted
Lungs CTA bilat. No cough or wheezing noted.
Abd soft non tender to palpitation with Colostomy intact, skin dry and intact surrounding pink-red stoma,
liquid brown feces.
Diminished sensation LE bilaterally, skin cool with rubor.
Old incision for L great toe amputation dry and intact. Able to ambulate to toilet and cafeteria with walker.
A: 250.70 Diabetes with peripheral circulatory disorders, currently controlled; with 443.81 peripheral
vascular disease due to diabetes; and 250.60 diabetes with neurologic manifestations of 357.2 diabetic
polyneuropathy.
Finger stick blood sugar ranges 125-175 in past 2 weeks. Diabetes controlled on current regimen a.c. & h.s.
insulin; sliding scale insulin if needed. V55.3 Functioning colostomy, no change in plan of care.
V49.71 Old amputated L great toe - stable.
290.40 Mild senile dementia (see notes October 10, 2006)
733.13 Osteoporosis with vertebral fractures (see notes September 13, 2006).
P: Continue current diet & insulin regimen. Retain sliding scale order for prn with notification parameters.
Continue current activity level.
Authenticated by: Physician, MD
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Tips
• Clear, Concise, Consistent, Complete, and Legible
• SOAP Approach: Subjective, Objective, Assessment, Plan
• Problem List Approach: a numbered and dated index of patient’s
problems kept in front of medical record, from identification through
resolution
• Reason for Visit: This is the chief complaint of the
patient:
– “weakness, headache, and liver cancer”
• Care Rendered: This is what was done to address the
chief complaint.
– “examination and blood work”
• Conclusion and Diagnosis: This is the outcome of the
findings based on the care rendered.
– “Anemia with coexisting conditions of Adult onset diabetes, neuropathy,
COPD, and Asthma”
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Top Ten HCC Groups
• COPD $3112
496
COPD
493.20 Asthma w/ chronic COPD (Chronic Obstructive Asthma)
491.9 Chronic Bronchitis
492.8 Emphysema
• CHF $3198
428.0
425.4
402.91
CHF
Primary Cardiomyopathy (Ischemic is not an HCC)
Hypertensive Heart Disease w/ heart failure
• Vascular Disease $2465
443.9
443.81
453.40
440.0
441.4
Peripheral Vascular Disease
PVD in other diseases (diabetes)
Acute DVT
Atherosclerosis of Aorta
Abdominal Aortic Aneurysm
• Cancer $1622-$8213
All malignant neoplasm’s including Melanoma but not skin cancer
All secondary malignant neoplasm’s – Highest HCC if site is documented $17,753
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Top Ten HCC Groups
• Ischemic Heart Disease $2215
411.1
Unstable Angina
• Specified Heart Arrhythmia $2285
426.0
Complete AV block
427.31 Atrial Fibrillation
427.81 Sick Sinus Syndrome
• Diabetes $1264-$3962
All diabetes (250.xx) and most of the manifestations
• Ischemic or Unspecified Stroke $2067
434.91 CVA
434.91 Unspecified cerebral artery occlusion, w/ infarction
• Angina/Old MI $1903
413.9
412
Angina Pectoris
Old MI
• Rheumatoid Arthritis & Inflammatory Connective Tissue
Disease $2699
714.0
710.0
725
720.2
Rheumatoid Arthritis
SLE
Polymyalgia Rheumatica
Sacroiliitis
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Other Common HCC Codes
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340 Multiple Sclerosis
332.0 Parkinson's
780.39 Seizure Disorder
362.02 Proliferative Diabetic Retinopathy
042 HIV
571.5 Liver Cirrhosis
556.9 Ulcerative Colitis
344.1 Paraplegia
344.00 Quadriplegia
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Audits
• CMS audits medical records to validate documentation.
• Validation Audits
– Superbills are not considered sufficient documentation …
they are a reporting format only.
– Documentation must show the diagnosis was assigned
within the data collection period.
– Data discrepancies that are found as a result of audit may
cause a risk adjusted payment to be changed.
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Contact Information
• Please remember, “If it’s not documented, then…. It didn’t
happen”
• Use proper ICD-9 CM coding and specificity
Please call or email us at anytime for questions or for assistance
•
•
•
Jessica Rivas (818) 702-0100 ext. 430 jrivas@medpointmanagement.com
Linda Deaktor (818) 702-0100 ext. 236 lldeaktor@medpointmanagement.com
Kimberley Litzsey (818) 702-0100 ext. 303 klitzsey@medpointmanagement.com
We welcome your feedback and appreciate your cooperation.
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