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Strategies for accurately and compliantly coding for HCCs and E/M changes

Insight Article - December 14, 2021

Compliance Regulations

Coding & Documentation

Value-Based Operations

The significant changes for outpatient and office visit E/M coding in 2021 remain an ongoing concern for medical group leaders to ensure accurate and compliant coding into the new year.

That message came from Beth Wolf, MD, CPC, CCDS, medical director for health information management, Roper St. Francis Healthcare, Charleston, S.C., and Colleen Deighan, RHIA, CCS, CCDS-O, ambulatory consulting services manager, 3M HIS Consulting Services, during their presentation at the 2021 Medical Practice Excellence: Leaders Conference.

Outlining the 2021 changes (see Table 1), Deighan called the moves affecting coding and documentation for office and other outpatient services an effort “around simplifying the work” for providers to have the work “be more in line with how physicians think.”



But physicians, providers and medical group staff increasingly must think about value, as reflected in the separate hierarchical condition categories (HCC) risk-adjustment methodologies developed by the Centers for Medicare & Medicaid Services (CMS) and the Department of Health & Human Services (HHS), with the CMS HCC system focused on the Medicare population and HHS’ system designed for all ages in the commercial payer population, as well as some Medicaid plans and ACA marketplace plans. The proliferation in risk adjustment also is buoyed by the extraordinary growth of Medicare Advantage (MA) plans in recent years, Deighan added: “MA enrollment more than doubled in the past decade and is projected to add another 10 million enrollees over the next eight years.”

That’s why “complete and accurate coding of HCCs is critical to proper payment,” Deighan continued. HCCs, directly and indirectly, factor into several value-based programs, including MACRA program payments, bundled payment programs, accountable care organization (ACO) shared savings and annual capitated payments.

The need for compliance

With this surge in risk-adjusted payment comes government audits. CMS is required to conduct risk adjustment validation (RADV) audits — some are random audits of MA plans, while others are targeted audits (using a stratified sample of patients) of MA plans that have raised red flags, such as significantly large increases in risk scores, Deighan said. “The focus is not on proving the ICD-10 coding, but rather providing the validity of the HCC value that was paid to the health plan by CMS for the reported ICD-10-CM diagnosis codes,” Deighan said.

Wolf offered the example of an established patient who has not been seen for a year to underscore the complexity of what qualifies as accurate and complete documentation of HCCs (see Table 2).

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