Measuring the effect of HCCs, part 3

Editor’s note: This article originally appeared in the Revenue Cycle Advisor. For more information about Hierarchical Condition Categories (HCCs), read this article from the CDI Journal by Gloryanne Bryant, RHIA, RHIT, CCS, CCDS. To read the first part of this article, click here. To read the second part of the article, click here. The views expressed do not necessarily represent those of ACDIS or its advisory board.

The effect of hierarchical condition categories (HCCs) may double as hospitals buy physician practices and form health systems made up of a spectrum of different types of providers. Physician reimbursement has become increasingly complex and some physicians find it easier to operate with the support of a larger organization. Organizations that were once solely hospital-based now have to grapple with the complexities of a different set of billing and reimbursement regulations, says James P. Fee, MD, CCS, CCDS, vice president of Enjoin, Collierville, Tennessee and a hospitalist at Our Lady of the Lake Regional Medical Center in Baton Rouge, Louisiana.

Fee’s seen a lot of interest in HCCs from large multi-practice groups affiliated with a larger organization and some smaller physician practices have also started to pay attention to HCCs, particularly if they work with a larger organization for EHR assistance to support meaningful use. “I think we’re at a tip of an iceberg in terms of interest in HCCs. I think providers have a lot more to learn about HCCs,” he says.

As provider organizations grow, they should create a program to collect and merge patient data for analysis just as payers do. This will give the provider insight into what reimbursement they can expect for certain patient populations and it can help pinpoint what departments need more help.

Organizations must ensure that coders, CDI specialists, and clinicians have the tools and knowledge to successfully navigate the documentation complexities of HCC-based models.

One common pitfalls found in physician practices stems from failure to document chronic conditions, Fee says. Clinicians generally learned that, to maximize the medical necessity of a service, they should document four diagnoses. But in HCC models, clinicians must document beyond the patient’s immediate diagnosis to address any condition which could affect the amount of care and attention the patient may need.

For HCCs, all chronic conditions, including past surgeries, must be documented at least once, annually, during a face-to-face encounter. For example, if a patient has an amputation and the physician documents it the year it happens, but does not document it during subsequent visits, HCC data will not reflect the amputation—jokingly referred to as HCC’s phantom limb

Because HCC data is calculated once a year based on information reported on claims, if the amputation isn’t listed in a given year, the data and risk adjustments for that patient will be created as if the patient never had an amputation, leading to a negative payment impact.

Remember that HCCs are grouped into related “families,” Fee says. Disease groupings with progressively higher severities establish a hierarchy that gives the highest severity the highest weight. HCC12 (breast, prostate, and other cancers and tumors) progresses to HCC11 (colorectal, bladder, and other cancers), HCC10 (lymphoma and other cancers), HCC09 (lung and other severe cancers), to HCC08 (metastatic cancer and acute leukemia). The coefficiencies for these HCCs range from 0.146 (HCC12) to 2.625 (HCC08).

CMS pays for the most severe form of disease reported in a given year. For example, in February 2016 a patient is diagnosed with prostate cancer (HCC12 = 0.146). In July 2016, the patient is diagnosed with metastatic prostate cancer to vertebra (HCC08 = 2.625). HCC08 is higher in the hierarchy than HCC12. All disease groups lower in the hierarchy than HCC08 are dropped. More resources are allocated to sicker patients; therefore, it’s vital that documentation and coding accurately express the patient’s condition.

Looking at the data can be an eye-opening experience, especially for physicians, Fee says. The data will make the connection between accurate documentation that includes chronic conditions and supports a patient’s actual level of severity and risk score, and poor documentation that makes a sick patient appear relatively healthy. The medical record should document the patient’s actual condition, the services that are medically necessary for the patient, and should reflect the hard work clinical staff put into caring for him or her.