1. Mastering the Basics of RISK ADJUSTMENT
Made Clear & Simple
by RONNIE R. SMITH, MD, RPVI
and actively practicing Internist

2. Risk Adjustment requires a NEW way of Thinking!
Historically you are accustomed to submitting CPT & ICD diagnosis codes on claims to validate reimbursement for services already rendered.
In Risk Adjustment payment models, your submitted I-10 codes that risk adjust will be used by a payer to calculate each of your patients’ Risk Adjustment Score. These scores will determine the projected ‘spending budget’ and prospective payments during the coming calendar year. Profitability or losses will depend on the net difference between Risk Adjusted payments and actual utilization costs for care rendered.

3. In other words, CPT/HCPCS codes submitted on a claim to a payer have been a financial transactional event, e.g., invoice for payment(s) based on services/procedures already rendered.
Going forward, Value-Based payments will be driven by I-10 Risk Adjustment coding combined with CPT/HCPCS HEDIS/PQRS compliance coding.

4. But things have changed!
Physicians just want to take care of patients like we were trained to do! We aren’t accountants and don’t like hassles!
But things have changed!
The most $uccessful physicians will Robustly Embrace and Master Risk Adjustment! Let’s see why!

5. RA Case #1 - Russell Smith, DOB: 07/01/1950
Exam
Unremarkable except for Obesity, decreased breath sounds & expiratory wheezes, Great Right Toe Amputation & positive monofilament
Assessment/Plan
Preventive visit and findings discussed
DM, Type 2 - stable, continue current treatment plan
COPD - stable, continue Advair
Neuropathy - stable, optimize BS control
Major Depression - Stable, continue Lexapro
Morbid Obesity - IBT to lose weight
Chief Complaint & HPI
No Symptoms, Presents for Annual Wellness Visit (AWV) with known T2DM on Insulin x 7 yrs. Polyneuropathy, COPD & Major Depression
Past Medical History
T2DM, Polyneuropathy, COPD, Major Depression, Traumatic toe amputation (1996)
ROS
Per HPI, all other systems negative
Vitals
Ht. 64 in, Wt. 240 lbs., BMI: 42

6. Financial Impact of Knowing What to Document & Code
Russell Smith’s Risk adjustment opportunities
Financial Impact of Knowing What to Document & Code
Moderate Specificity Documentation & Coding
High Specificity Documentation & Coding
Condition
I-10
HCC
RAF weight
66 year old, male --
0.288
AWV
Z13.9
n/a
BMI=42.0
Z68.41 22
0.365
T2DM-Uncomplicated
E11.9 19
0.118
T2DM with Neuropathy
E11.42 18
0.368
Neuropathy
G62.9
Neuropathy (buddy code)
Long Term Insulin Use
Not coded
Z79.4
Major depression, unsp.
F32.9
Major Depression, Mild
F32.0 58
0.330
Asthma, Severe
J45.50
COPD, unspecified
J44.9
111
0.346
Great Toe Amputation
Z89.419
189
0.779
No Disease interaction
Disease Interaction is T2DM-COPD
Disease Interaction
0.182
Patient RAF Score
0.771
2.776
PMPM Payment
$542
$1,943
Annual Payment
$6,493
$23,333

7. The most financially impactful is the
ICD-10 Risk Scoring of Patients based on:
The 8,830 Risk Adjusting I-10 codes, better known as the CMS HCC-RAF codes, found within the 140,000 total I-10 codes.
There are ~10,500 Risk Adjusting I-10 codes for most commercial payers that utilize proprietary Risk Scoring grouper models

8. The 4 Essential Keys to Improving Healthcare Quality & Financial Outcomes are:
Mastering Risk Adjustment Factor (RAF) Recognition, Documentation & Coding!
Mastering HEDIS/PQRS quality measures compliance
Eliminating Inefficient Spending & Resource Consumption!
Delivering Exceptional Customer Service to Achieve Outstanding Patient Experiences!

9. The most successful healthcare providers will formulate and implement strategies to:
Better manage spending, utilization and resource consumption.
Capture & satisfy quality measures - HEDIS/PQRS/MACRA.
And more importantly, robustly embrace the recognition, documentation & coding of Risk Adjustment Factor opportunities to the highest levels of accuracy and specificity to insure the lowest possible Medical Loss Ratios (MLRs).

10. What is Risk Adjustment?

11. CMS HCC Model, version 22 Risk Adjustment in the
140,000 base ICD-10-CM Codes
8,830 of these Risk Adjust (RAFs)
By mapping to one of 79 HCCs with a specific weight
used to determine
final payment
HCC – Hierarchical Condition Category
RAF – Risk Adjustment Factor

12. How is a HCC-RAF captured? ~ First, you must ‘recognize’ it!
~ Secondly, you must accurately and
thoroughly document it with M.E.A.T.!
~ Thirdly, you must code it correctly!
Don’t delegate RAF coding to a coder!
A ‘best practice’ strategy is to utilize the
‘Quick HCC-RAF Recognition’ tool by SH&WS
in every exam room.

13. Each HCC-RAF must be:
Documented, coded and submitted on a payment claim form during each ‘calendar year’.
Addressed on a ‘face-to-face’ encounter with a provider.
Supported by ‘medical decision-making,’ especially when certain conditions are linked based on ‘cause & effect’ and generally carry a higher RAF weight when linked, e.g., Diabetes Mellitus w/ manifestation/complication.

14. Coders are forbidden to assume that
diagnoses are linked unless they are
clearly stated as linked in the progress
note (“due to”, “caused by”, & etc.)!
Make your coder’s and/or biller’s job
easier.
Use your clinical knowledge to leverage your ‘privilege of Medical Decision-Making’ concerning linkage of diagnoses as to their cause & effect relationship.

15. Audit proof your coding of
HCC-RAF conditions with M.E.A.T. style documentation
to pass any Risk Adjustment Data Validation (RADV) audit with flying colors!

16. M.E.A.T. documentation example:
M - T2DM w/ ‘diabetic CKD’, stage 3; no polyuria or polydipsia.
E - A1c is 7.4, eGFR = 48, urine ma = 86.
monofilament test is negative.
A - Stable, A1c goal is 6.5.
T - OV with F/U A1c, urine ma & PTH in 6 months cal ADA & DASH diet. Continue
metformin & lisinopril. Healthy Lifestyle
education.

17. “Our First Eureka Moment”
To our surprise, we discovered that only
~ 200 base I-10 codes accounted for
the following percentages of potential Risk Adjustment capture OPPORTUNITIES:
95.5% for Adult Primary Care
88% for Adult Specialty Care
84% for Adult Hospitalist Care

18. Top 200 Diagnosis codes submitted to Medicare (2014)
~ Only 26 (13%) of the Top 200 submitted Diagnosis codes actually Risk Adjusted (Note: All diabetes codes counted as 1)
~ #1 submitted Diagnosis code – I10 Essential Hypertension does not Risk Adjust.
~ #2 submitted Diagnosis code – Other Hyperlipidemia does not Risk Adjust.
~ #3 submitted Diagnosis code – Type 2 Diabetes Mellitus w/o complication does Risk Adjust but with a low RAF weight =
The average Medicare Risk Adjustment Score is 1.000
My Medicare Risk Adjustment Score for 7/1/16 through 9/30/16 was My clinical team utilizes the “Quick HCC-RAF Recognition” tool by Successful Health & Wellness Solutions in every
exam room.
I focus on accurate & thorough M.E.A.T. documentation for each RAF to support my coding. This is key in order to RADV audit-proof one’s coding.

19. Please Understand! Patient Risk Scoring sets your future
“spending budget”! Your ‘spending budget’
minus your ‘resource usage’ will be used to calculate your Medical Loss Ratio (MLR) to determine if there is a shared savings and/or any potential earned incentives!
MLR < 1.0 = $ profit and > 1.0 = $ loss.

20. DON’T FORGET
to always document/code Z for long-term use of insulin!
It provides additional HCC-RAF weight of 0.118

21. Primary Care Providers should Always perform an ‘ANNUAL WELLNESS VISIT’ (AWV) for Medicare Patients, part B & C, or an ‘ANNUAL PREVENTATIVE EXAM’ (APE) for Commercial Insurance Patients

22. The Goal is….
Healthy,
Happy
PATIENTS

23. We are optimistic, disruptive transformers of healthcare!

24. We do the unthinkable by:
Putting the patient front and center
Teaching physicians to connect with patients through emotional intelligence and shared decision-making
Transforming medical practices from fragmented, reactive, episodic sick care to proactive, continuous, wholistic well-care
Re-vitalizing the team-based health caring approach.
Leveraging the most underutilized care team members
Nurses
Coaches/Nutritionists
Pharmacists

25. We are in the midst of a major shift in healthcare reimbursement for providers. This is happening in every aspect of the healthcare industry.
Physician's office
Hospitals
Home Health
Skilled Nursing

26. Value Based Care requires a NEW way of Thinking!
Historically Providers:
Document the history of a patient when the patient is new- They do not document on an annual basis
Submit CPT & ICD diagnosis codes on claims to validate reimbursement for services already rendered.
Look at outcomes from a financial perspective.
Treat chronic conditions as maintenance visits
Preventive care was treated as an option to patients because traditionally is was not a covered service

27. Two challenges to keep in mind:

28. Physician Burnout…
63% for Primary Care according to the Mayo Clinic’s ongoing study…
* 36% in 2013
~ Improving providers time, flow and operations is fundamental in helping them succeed in the transition to value based care.

49. Knowledge Transfer
“Successful knowledge transfer involves neither computers nor documents but rather interactions among people”

50. The Goal is….
Healthy,
Happy
PATIENTS