FAQ: 10 Things You Need to Know about Risk Adjustment
Providers who hire Certified Risk Adjustment Coders (CRCs™) have nothing to fear.
The risk adjustment methodology is a relatively new payment model that is prospective in nature — meaning that healthcare costs in future years are based on what is known to be true of healthcare costs in recent years. Providers that hire CRCs™ have the advantage in this new culture, as these professionals understand risk adjustment and its inherent challenges. The following 10 frequently asked questions (FAQs) shed more light on the subject.
FAQ No. 1
Isn’t risk adjustment just like fee-for-service (FFS), except it focuses on diagnosis codes instead of CPT® codes?
A: Risk adjustment cannot be compared to FFS rules for several reasons, one being that the qualifications for diagnosis submission are not the same. In the FFS world, diagnoses are typically submitted when they have “MEAT” (monitor, evaluate, assess, or treat) — a concept that only applies when choosing an evaluation and management (E/M) level of service. You cannot bump up a level of service with additional diagnoses unless those diagnoses are addressed at that visit. ICD guidelines, however, have always instructed us to code for all coexisting comorbidities, and especially those that are a part of medical decision-making (MDM). You cannot allow diagnoses not addressed or treated to influence selection of E/M service codes.
FAQ No. 2
What spurred AAPC to create the CRC™ credential?
A: Years ago, I spoke with AAPC about the need for a credential or platform for risk adjustment coders. I was not alone: Others had even pitched a curriculum or program. Many of these were education ideas centered on hierarchical condition categories (HCC), but there has never been a credential based on a singular payment methodology. What should have been pitched was a curriculum that includes all forms of risk adjustment (including population health management), instead of focusing on payments. The CRC™ credential eventually was created out of demand from coders and risk adjustment professionals.
FAQ No. 3
What is the difference between AAPC’s CRC™ curriculum developed in 2015 and the new curriculum?
A: The curriculum developed in 2015 was created for coders who already had a core coding credential. The curriculum focused on risk adjustment, only, and did not cover basics, such as the business of medicine, anatomy and physiology, complete ICD coding guidelines, etc. Risk adjustment was in full swing for Medicaid and Medicare plans, but the risk adjustment model for the U.S Department of Health & Human Services (HHS) was still being developed. The 2016 CRC™ curriculum is designed as a standalone credential. In addition to the fundamentals, the curriculum includes current information for the HHS model, as well as annual updates.
FAQ No. 4
How can I best prepare for the CRC™ exam, and who made this exam?
A: The best way to prepare for an AAPC exam is to take the related AAPC course.
The CRC™ exam committee is comprised of risk adjustment professionals from across the country. The exam questions are based on what you should know to properly code for risk adjustment. This includes the basics of risk adjustment, proper ICD code selection, how to handle documentation challenges, as well as predictive modeling, quality, and basic financial ties of risk adjustment in healthcare.
FAQ No. 5
Why are there differing instructions for risk adjustment coding, and which instructions are correct?
A: There are differing instructions for many reasons: Some organizations feel more comfortable only allowing diagnoses that were managed or addressed in the encounter. Although there have been Risk Adjustment Data Validation (RADV) audits by the Centers for Medicare & Medicaid Services (CMS) that have approved all current diagnoses, there have also been Office of Inspector General audits conducted by auditors who are not trained in risk adjustment and who applied FFS rules to risk adjustment audits.
The correct methodology for risk adjustment coding is to code for all current diagnoses. The diagnosis does not need to be treated, managed, or addressed; it merely has to be an ongoing chronic condition noted by the treating provider or part of MDM. For example: “I had to consider the patient has diabetes when treating this other condition,” or “I had to consider this patient has cancer, even though I am not personally treating the cancer myself,” etc.
The purpose of collecting all current diagnoses for each year is to account for the correct financial needs of patients in the following year. Leaving out factual diagnoses harms the health plans and, ultimately, the patients. The idea is that if a patient really has a condition, then it will be addressed at some point in the year in a face-to-face visit. (This is not necessarily true for “status of” codes and other conditions that are persistent and known, but not regularly treated.)
FAQ No. 6
How do I handle lists found in documentation such as a past medical history (PMH) only list?
A: The problem with lists in medical record documentation is that there can be so many variations from one provider to another. CMS knows that providers make mistakes — such as mixing both old and current diagnoses in a list titled PMH, or listing old conditions under the “Active” or “Current” header. Errors like these make clinical documentation challenging to code properly.
I created a new acronym, TAMPER™ (Treatment, Assessment, Monitor or Medicate, Plan, Evaluate, or Referral) for lists. This acronym is officially trademarked through the U.S. Patent and Trademark Office by ionHealthcare®. The purpose of TAMPER™ is not to be a competitor for the MEAT concept; this acronym was made for coders evaluating various lists, such as PMH, Active, Current, Ongoing, etc.
Note that when medications are used to support a current diagnosis, it’s important for the medication list to be current and for the medication to be used to treat only that condition. If you feel uncertain about a diagnosis presented in a list, you can easily apply the TAMPER™ concept by asking yourself, “Did the provider TAMPER™ with the diagnosis?” If the answer is yes, then you can code it from the list as a current diagnosis.
FAQ No. 7
Can you tell me more about job opportunities and the cycle of risk adjustment work?
A: There are many risk adjustment vendors and organizations across the country and overseas. Many hire remote coders. Some pay by the hour, and others by the chart. Some offer good 1099 contractor opportunities, where you can work from home without worrying about business insurance, obtaining clients/contracts, information technology issues, etc., which allows you to focus on your job. Regardless of the vendor, all risk adjustment activities occur at the same time every year. Typically, risk adjustment chart review for CMS is completed in June through the following January of each year. Commercial risk adjustment review activities typically run all year. In risk adjustment, all organizations are busy at the same time. Whenever there are lulls in work, there are industry-wide lulls.
FAQ No. 8
What exactly is RADV and what are the differences of CMS RADV and HHS RADV?
A: There are two main types of RADV for CMS:
- Random CMS RADV uses a selection process in which a Medicare Advantage (MA) plan is randomly selected for an audit.
- Targeted CMS RADV is applied to MA plans who have raised red flags, such as a large increase in risk scores, etc.
Both random and targeted CMS RADVs use a “stratified sample:” a random sample of 1/3 of patients with high risk scores, 1/3 of patients with medium risk scores, and 1/3 of low risk scores. The focus is not proving the ICD code, but rather proving the validity of the HCC value that was paid to the health plan by CMS for the reported ICD code. Any ICD code supporting the HCC (or higher HCC value) is acceptable.
HHS RADV is similar to CMS RADV, but stratifies its sampling among adult, child, and infant patients, and by metal levels (silver, gold, platinum) offered through the commercial health plans.
CMS RADV allows any face-to-face encounter that supports the HCC value for a date of service within the calendar year. HHS RADV requires the face-to-face encounter to be reported through the claims EDGE server. CMS recently stated it also allows for non-EDGE claims, as long as the encounter meets all of the same criteria of a face-to-face encounter.
CMS RADV is typically performed on data from three years prior, whereas HHS RADV is performed on the prior year’s data.
CMS RADV affects payments made to a health plan and may require reimbursement to CMS. HHS RADV affects allowable funding for each health plan based on reported conditions. Health plans with lower-cost patients (by risk/HCC value) may have to pay back into the system to cover health plans with higher-cost patients (by risk/HCC value).
For more on RADV, see the article “RADV Reality” on page 28 in this issue of Healthcare Business Monthly.
FAQ No. 9
Why do some companies code offshore in risk adjustment?
A: Some organizations will not offshore coding work because it is derived from U.S. government-based programs. Organizations who do offshore usually do so because coding services are less costly than in the United States. HIPAA does not apply overseas. Anyone considering offshoring risk adjustment work should include all requirements of HIPAA in their contractual agreements, and perform a mock breach process to ensure the ability to track disclosures and medical record security.
Some organizations market themselves as “approved by HIPAA,” but there is no such designation. They may have had a third party assess their security, but the covered entity is ultimately responsible for the security of their records.
Some U.S.-based companies have only administrative offices onshore, while the actual work is offshored. Several coding companies based in other countries focus on marketing risk adjustment coding services. U.S.-based companies can vary, as well: Some specialize in medical record retrieval, some in analytics, and others in population health management. Very few specialize primarily in coding.
FAQ No. 10
What are some of the important changes to risk adjustment with ICD-10-CM?
A: Risk adjustment models change each year (January-December); while ICD codes change each Oct. 1. When assigning codes, remember that there may be new codes issued in October that are not yet added to risk adjustment models.
Most conditions that risk adjust are chronic, life-long illnesses. ICD-10-CM includes many new combination codes that may best describe two or more conditions when concurrently present on a date of service. There was a CMS HCC model change in preparation for ICD-10, and this newer model took into account these combination codes and their respective values. HHS based its model on the CMS model, but also includes diagnoses commonly found in young people. The HHS model does not have a Part D portion, as CMS does, but there are plans to move in this direction on the commercial risk adjustment side.
Brian Boyce, BSHS, CPC, CPC-I, CRC, CTPRP, is an AAPC-approved PMCC instructor and ICD-10-CM trainer, and the author of the AAPC CRC™ curriculum. He has specialized in risk adjustment from the very beginning of model utilization, and has assisted large and small clients nationally. Boyce’s special interests are ethics, patient safety, disease management, and managing people and leadership. He is a Desert Storm veteran, where he served on active duty with the U.S. Air Force, with a job specialty of Aeromedical Evacuation. Boyce began physician practice management and medical coding after an honorable discharge. He is CEO of ionHealthcare®, LLC, a company that specializes in risk adjustment coding and support services (email inquiries to info@ionHealthcare.com). Boyce is on the AAPC National Advisory Board and a member of the Richmond, Va., local chapter.
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- FAQ: 10 Things You Need to Know about Risk Adjustment - September 2, 2016