HCC scores have been used since 2004 by Medicare to adjust payments based on the risk level of the enrollee. This has resulted in Medicare paying a higher monthly capitation fee for patients with higher HCC scores as these patients require more resources and disease intervention. The HCC payment system uses ICD-10 codes and demographics to generate a risk adjustment factor (RAF) score which identifies patients that require higher cost to care for and is based on the diagnosis codes billed in the previous review period.
All healthcare facilities – irrespective of whether they are a business enterprise or a charitable institution – have to be financially viable in order to continue to provide services. Clinical documentation improvement (CDI) programs have evolved from being an informal part of the process to becoming the backbone of the facilities financial viability.
Improving clinical documentation leads to revenue gains and most healthcare facilities are now exploring this program. The main reason for getting into this program is to improve your reimbursements and that will happen with improved documentation and coding. However, it is important to set specific goals when putting together a Clinical Documentation Improvement (CDI) program for your facility.
Once an informal process that received significant attention at just a few hospitals; Clinical Documentation Improvement (CDI) is now the backbone of an organizations financial viability. Essential for patient safety, proper and accurate reimbursement, quality ratings and more, a strong CDI program will ensure documentation integrity – a key factor in the ICD-10 transition.
The main reason for the transition from ICD-9 to ICD-10 was greater documentation precision. However, if the diagnostics is documented by clinicians at a lower level than what ICD-10 supports, it may result in submission of financial claims that are lower. Such documentation will also cause a patient’s medical record to lack details, resulting in incomplete information for future providers.