Start your revenue cycle strong by ensuring that critical, and accurate, patient information is in place before patient visits begin.
Health Information Management
Our team of coding experts, with a deep understanding of the healthcare industry and its specialties, paired with smart technology creates a tangible, positive impact on cash flow.
Extended Business Office
AGS Health provides a comprehensive suite of RCM services that are customized for each customer. Our experienced team of experts serves as an extension of your business office.
Analytics and Reporting
Obtain answers to critical questions related to performance benchmarking, root cause analysis, predictive analytics, and operational improvements.
Connect with us
Request a demo
Latest CASE STUDIES
By AGS Health
March 1, 2023
Section 1343 of the Affordable Care Act (ACA) addresses the need for a risk-adjustment model. The U.S. Department of Health and Human Services (HHS) created a risk adjustment model based on the Hierarchical Condition Category (HCC) classification system. However, this model was developed using commercial claims data and refined HCCs to reflect those conditions expected within the commercial risk adjustment population. The hierarchical grouping logic is similar to the Medicare methodology, but HHS selected a different set of HCCs for the federal commercial risk adjustment methodology to reflect the population differences. HCCs may be excluded from this risk adjustment model if they are not predictive of costs or if the diagnoses are too vague, discretionary in treatment or coding, or not medically significant.
The HHS-HCC is a risk adjustment model that calculates risk scores concurrently, which means it uses diagnoses from a period to predict costs in that same period. This model is primarily used for commercial payers of the Affordable Care Act (ACA) and is not restricted to older patients, which the CMS-HCC is. This model includes categories for:
These risk scores are used to adjust payments and bids based on the health status (diagnostic data) and demographic characteristics (such as age and gender) of enrollees.
Both the CMS-HCC and the HHS-HCC models are used to provide risk-adjustment payments for patients with more complex care needs.
The HHS risk adjustment methodology aims to compensate health insurance plans for differences in enrollee health mix, so plan premiums reflect differences in scope of coverage and other plan factors, but not differences in health status.
Patients are classified by platinum, gold, silver, bronze, or catastrophic level. Payments are adjusted by plan level, geographical rating area, induced demand, and age rating, so transfers reflect health risk, not other cost differences.
This model did not initially include prescription-based diagnoses, such as those found in the RxHCC used by Medicare. After the first year of collected data, capturing high-cost prescriptions was identified as a future need.
Bronze plans generally have the lowest premiums (monthly cost) but also the highest deductibles and other out-of-pocket costs.
Platinum plans usually have the highest premiums but the lowest deductibles and out-of-pocket costs.
Patients who qualify for cost-sharing reductions based on income and enroll in a silver plan may get the best of both worlds - lower premiums and out-of-pocket costs.
Catastrophic plans have lower monthly premiums and a very high deductible. These are best used to protect patients from worst-case scenarios, such as a life-threatening illness or injury; however, catastrophic plans do not cover most routine medical expenses.
With each plan paying more of the covered out-of-pocket expenses, the premium paid each month goes up. So given the bronze example above, choosing that plan would incur a higher deductible or copay but a lower monthly premium.
The U.S. Department of Health and Human Services (HHS) uses the Risk-Adjustment Factor (RAF) methodology. This is similar to the model the Centers for Medicare and Medicaid Services (CMS) uses to risk adjustment payments to insurers under Medicare Advantage and to set budgets for Accountable Care Organizations (ACO) under the Medicare Shared Savings Program (MSSP).
RAF is a sum of multiple factors, such as:
These factors determine the health risk of an enrollee. The health conditions are identified using Hierarchical Condition Category (HCC). The HHS-HCC model uses many MSSP conditions but includes specific codes to risk-adjust pediatrics, neonatal, and pregnant populations.
Similar to the CMS methodology, HHS-HCCs must be re-coded each calendar year to count toward the patient’s RAF score. Medical records must reflect that the condition is monitored, evaluated, assessed, or treated.
There are 127 HCC codes presently being used in the HHS model, with 7768 ICD-10 codes mapping to an HCC. The HHS-HCC model is concurrent, meaning codes submitted during the current year are used to determine that year’s budget. The CMS model is retrospective, using codes submitted from a previous year to estimate future healthcare costs.
As such, the HHS model uses both chronic and acute conditions to determine healthcare costs in the current year, whereas the CMS model (in general) focuses on chronic health conditions that drive future healthcare costs.
The HHS-HCC also aims to limit the use of codes that might represent the poor quality of care (e.g., pressure ulcers or complications of care), random acute events (e.g., trauma), or codes that are susceptible to discretionary diagnosis coding.
The most common HCCs in adults include:
The five most common HCCs in pediatrics include:
AGS Health is more than a revenue cycle management company–we’re a strategic partner for growth. By blending technologies, services, and expert support, AGS Health partners with leading healthcare organizations across the US to deliver tailored solutions that solve the unique needs and challenges of each provider’s revenue cycle operations. The company leverages the latest advancements in automation, process excellence, security, and problem-solving through the use of technology and analytics–all made possible with college-educated, trained RCM experts. AGS Health employs more than 10,000 team members globally and partners with more than 100 clients across a variety of care settings, specialties, and billing systems.