With the upcoming shift from CMS-HCC version 24 to version 28, health plans are preparing to address significant impacts on risk adjustment scores, which influence revenue and premium accuracy. This update brings notable shifts in hierarchical condition categories (HCCs), changes in the diagnostic classification, and adjustments to risk scores based on coding refinements and advances in clinical understandings. For health plans, these updates are pivotal, impacting strategies for member engagement, coding, and quality assurance. Here’s an in-depth look at the impacts and proactive steps for mitigation.

Key Impacts on Health Plan Premiums

CMS-HCC changes directly affect health plan premiums, as they adjust how risk scores are calculated and ultimately influence premium payments. Here are three primary impacts:

1. Risk Score Adjustments: With changes in diagnosis categories and revised HCC groupings, certain chronic conditions might carry different weights in calculating risk scores, impacting revenue calculations.
2. Focus on Accurate Coding: The move to v28 tightens up on specific diagnoses that impact risk adjustment. This emphasizes the need for accurate coding practices, requiring providers to maintain high documentation standards to capture members’ health status accurately.
3. Revenue and Payment Precision: As plans transition from v24 to v28, the modification in risk scores may lead to fluctuations in predicted payments. Plans may experience payment shifts as CMS updates its reimbursement strategy based on changes to reflect the evolving population and healthcare costs.

Given these impacts, health plans need a continuously adaptable yet comprehensive approach to mitigate revenue risks and ensure compliance with the new CMS-HCC guidelines.

Top 4 Steps to Update Your Playbook for Mitigating CMS-HCC v24 to v28 Transition Impacts

1. Conduct Impact Analysis and Revenue Modeling
   • Begin by assessing the financial impact of the CMS-HCC changes on your current member population. Model revenue impacts based on the expected v28 scores versus v24 to identify high-risk areas.
   • Use predictive models to estimate shifts in premium based on the recalibration of risk scores. Collaborate with actuarial teams to create “what-if” scenarios, helping pinpoint changes in risk capture and expected financial adjustments.
2. Enhance Coding Accuracy and Documentation Quality

1. Educate providers and clinical staff on the new HCC categories and documentation requirements under v28. Prioritize coding areas that see significant changes to avoid potential revenue losses due to miscoding or documentation gaps.
2. Regular audits and provider education can help maintain high documentation standards, reducing the risk of missed conditions and misrepresented patient severity, which could otherwise affect risk adjustment scores.
3. Develop Member Engagement Strategies Focused on High-Risk Populations

1. Identify high-risk members whose diagnoses may be impacted by the shift to v28. Engage these members through targeted outreach programs that ensure they receive necessary healthcare services and accurately reflect their health status.
2. Use predictive analytics to track population trends, focusing on members with chronic and complex conditions. Engage members in preventive and routine care to promote better health outcomes and capture all relevant diagnoses accurately.
3. Update Compliance and Quality Assurance Programs

1. Revise quality and compliance programs to align with CMS-HCC v28, particularly as they relate to the coding and review processes.
2. Invest in training for compliance teams to recognize nuances between the v24 and v28 frameworks, focusing on updated HCCs that require new documentation practices. This will help prevent errors and ensure documentation meets regulatory standards.
3. Utilize advanced data analytics and technology platforms to continuously monitor and adjust to CMS updates, identifying potential gaps in quality that could affect future revenue.

Moving Forward

The transition from CMS-HCC v24 to v28 represents both challenges and opportunities. Health plans that proactively build a robust playbook, emphasizing comprehensive data analysis, documentation accuracy, member engagement, and regulatory compliance, will be best positioned to minimize negative impacts on revenue. These proactive steps will enable health plans to sustain premium accuracy and mitigate financial risks, ultimately leading to a smoother transition and long-term success under the CMS-HCC v28 framework.