The risk adjustment industry may have experienced more upheaval in 2023 than the prior five years combined. Major regulatory changes announced by CMS shook up the industry. Vatica Health covered the operational and financial impacts of the Final Rate Notice–moving from V24 to V28–as well as the changing regulatory environment created by the Risk Adjustment Data Validation (RADV) Final Rule. Vatica analyzed these significant developments and provided practical insights on how to navigate these choppy waters. We also covered topics to help providers cope with the challenging environment.
Vatica covered the RADV Final Rule and the CMS Final Rate Notice in this piece highlighting practical strategies to consider. We delved into the RADV Final Rule in this blog, offering tips for both payers and providers. The potential financial impact of the RADV rule is explored in this piece.
Payer and provider collaboration
Vatica has helped lead the industry towards greater collaboration between payers and providers to optimize compliant risk adjustment. Hear directly from payers and providers in these webinars:
Provider burnout continued to be a key issue in 2023. We provided tips for easing providers’ coding and documentation burdenshere. The impact of Social Determinants of Health and five ways providers can address them are explored in this blog.
How Vatica can help
Vatica is the#1 ranked PCP-centric risk adjustment and quality-of-care solution for health plans and health systems. By pairing expert clinical teams with cutting-edge technology, Vatica increases patient engagement and wellness, improves coding accuracy and completeness, identifies and closes gaps in care, and enhances communication and collaboration between providers and health plans. The company’s unique solution helps providers, health plans and patients achieve better outcomes together. With the Vatica team providing the extra resources needed for complete, compliant coding and documentation, physician participation is easier to enlist and sustain. To learn more, visit https://vaticahealth.com/.
Payers are under a lot of pressure to optimize risk adjustment and compliant yield in light of the CMS Risk Adjustment Data Validation (RADV) Final Rule and Final Rate Notice issued earlier this year. A recent webinar for members of the RISE Associationfocused on how payers can partner with PCPs to accomplish both.
Presenter Brian Williams, MD, is medical director of optimization at Northeast Medical Group in Mystic, Conn., part of the Yale New Haven health system. He is immersed in the system’s transition to value-based care (VBC), with 230,000 patients in shared savings or cost-sharing agreements.
Dr. Williams was joined by Michael Rosenfeld, VP of business development for Vatica Health. Michael shared case studies from payers and providers who have benefited from collaboration to maximize compliant risk adjustment yield and close care gaps.
Legacy models for risk adjustment that work around PCPs, such as retrospective chart reviews and home assessments, are fraught with issues. Dr. Williams and Michael agreed that the ideal process is PCP-centric, providing dedicated resources, data and integration into the PCP’s existing workflow. Dr. Williams added that the most effective ways to engage providers are for payers to have a dedicated provider engagement staff and offer aligned incentives, provider education about clinical documentation and easy-to-use technology.
The role of provider-centric risk adjustment technology is to support the patient-PCP relationship by empowering compliant code capture, improved utilization management, patient adherence and holistic care. The technology should present high-confidence conditions from the EMR and claims data, deliver timely and actionable data and facilitate a complete and accurate coding exercise. It should not contribute to alert fatigue or require the provider to go back to the EMR to verify information. This approach improves provider and patient satisfaction and helps ensure better care coordination and the closure of care gaps.
Michael noted that working with community providers can mean multiple EMRs, limited staff and infrastructure, and competing priorities. To maximize their performance, payers can provide solutions that are easy to use and supported by clinical and administrative teams, while educating them on the importance of risk adjustment to drive optimal patient care.
Dr. Williams offered advice on how payers can assist busy PCPs on risk and quality initiatives. “It helps to have a lot of the work done before it’s presented to us. Make sure that we are working as a team. Then physicians can use their training and clinical decision making to do the assessment. Do the work that you can do as a payer,” he said. “You have to reimburse physicians for the time and effort they are spending on this work. Then make sure the clinicians have appropriate resources to help them learn to navigate whatever solutions it is.”
He cited actions that are not helpful to PCPs, including interruption to the clinical workflow, any interference of time spent with the patient, interruption of the practice’s revenue cycle or overburdening of staff.
Dr. Williams also noted that PCPs are taking on more administrative responsibilities unrelated to why they chose the profession. Payers can help make them feel valued by paying PCPs fairly and quickly and “staying in their lane,” that is, handling what is appropriate for payers to handle while not carving PCPs out of care decisions.
“A payer solution was our first real ‘toe in the water’ toward value-based care,” he noted. “Part of the success we’ve had comes from sharing the organization savings with the clinicians. They understand that the work is valuable. They take it seriously. We don’t have to force them. They’ve also become very skilled at it because they received good education and support to do this work.
“Our HCC recapture rates for fiscal year 2022 were over 95%,” Dr. Williams continued. “We have categorized our patients into seven categories of risk. We understand very clearly what patients’ risk for hospitalization and serious illness is based on which risk category they fall into. We have begun to use those risk categories to direct our resources. We’re seeing lower hospitalization rates for those patients that we’re using this algorithm for. That’s encouraging.”
Dr. Williams noted that NEMG has several payer programs in place; Vatica has the highest participation and highest user satisfaction. “It’s integrated with our EMR and that information becomes part of the patient’s care going forward.” Leveraging EMR data is critical, as many other solutions rely on claims data which can be stale and less accurate.
Vatica’s prospective solution pairs clinical staff and technology to assist physicians with coding and documentation. Clients have seen an average of 25%+ improvement in accuracy and specificity and 37% higher gap closure rate. “Our coding team reviews 100% of the information documented by providers to ensure it meets standards for clinical validation,” Michael added. “Nothing gets sent to our payer or provider partners that hasn’t been reviewed in a multi-step process to ensure that it meets compliance standards and protects our clients from audit risk.“
Michael reviewed a case study with a regional Blue Cross client that showed total incremental HCC revenue of over $100 million based on 44,600 annual encounters. It’s important to note that strong financial results are due to more accurate and complete coding and documentation.
He also shared data from a provider client who completed Vatica visits for 73% of 47,000 eligible patients in a year. During those visits, Vatica detected more than 73,000 open care gaps for physician review and helped physicians accurately identify and code diabetes with chronic complications, increasing the rate from a 4.74% baseline to 19.19% in one year.
For more information on how Vatica can help payers support PCPs to maximize compliant risk adjustment yield and quality of care, visitVaticaHealth.com.
Provider burnout isn’t new. It existed long before COVID and was exacerbated by the pandemic. But it’s rising to new levels. For example, recent labor issues at Kaiser—resulting in the biggest healthcare strike in US history—were caused in part by acute staffing shortages that drive provider burnout.
To combat burnout, healthcare organizations are raising wages. Most are strengthening hiring and retention efforts, along with a variety of other tactics. Some states are pursuing safe staffing legislation. The situation is dire and creating an impediment to achieving the CMS Triple Aim: improving patient care, reducing healthcare costs and improving population health. More recently, recognizing the importance of provider engagement and wellness, healthcare leaders have considered expanding to a Quadruple Aim to include the clinician experience.
Aside from obvious solutions—staff recruitment and wage increases—what else can be done?
One area of focus should be administrative burden, with physicians spending nearly 2 hours a day on EMR tasks outside work. While EMRs bring needed automation and better data, they’ve become more complex, driven by increasingly detailed and nuanced data requirements that create stress and distract from patient care. Alert fatigue is one result of this stress and distraction, which is exacerbated by vendors that send unvalidated conditions and codes directly into the EMR and physician workflow.
Additionally, healthcare policymakers and regulators continue to mandate more documentation to demonstrate compliance with laws and standards, resulting in lengthier documentation. Value-based care (VBC) payment models, which are becoming more common, require even more clinical support, coding and documentation to achieve performance goals.
At Vatica Health, clients appreciate our unique model of supporting providers with clinical and admin resources. We’ve found these strategies reduce the admin burden for our provider clients and support their transition to VBC payment models as well:
Offer physician training on standard coding and documentation practices: get all providers on the same page in terms of process and workflows.
Align physician compensation with VBC initiatives: ensuring that physicians are compensated and incentivized is paramount to obtaining physician buy-in and ongoing participation. By thoughtfully designing compensation programs for both clinical and support staff, provider groups can counter the problems of physician burnout, declining retention and shortage of physicians.
Optimize the EMR and pre-encounter prep to drive efficiency and comprehensive visits: EMRs on their own do not sufficiently support coding and documentation to optimize VBC performance. Solutions are available that optimize EMR performance to help identify care gaps and facilitate accurate coding.
Create better alignment with payers and advocate for programs that remove operational burden associated with risk adjustment and quality initiatives: these programs can help provider groups realize incremental revenue, improved outcomes, increased numbers of preventive health encounters and improved performance in VBC arrangements.
Provide support to help physicians capture and address SDOH: successful programs include training clinical staff, providing access to local resources, developing workflows and promoting standard practices that help simplify the risk-adjustment process, including allocating time during patient encounters for these critical conversations.
Be transparent about the financial impact of physician performance in VBC: executive leaders should share financial performance data with physicians and potentially other staff as well. Incremental revenue earned through participation in such programs can support a financially positive outcome for the group.
A select few health plan-sponsored solutions relieve administrative burden and help improve clinical and financial performance. One example is Vatica Health, where licensed clinical nurses are assigned to each contracted practice. The nurses create a comprehensive, curated Vatica medical record for each patient encounter, presenting only conditions that are fully supported by clinical documentation. PCPs receive a streamlined, prioritized list of conditions that they can review at their convenience.
Provider group leadership should consider all viable options to address provider burnout – especially as VBC transformation creates more demands. Recruiting additional providers gets tougher as competition for fewer physicians, mid-level practitioners and nurses escalates. Finite financial resources limit never-ending wage increases. Leaders should consider out-of-the box solutions, such as payer-sponsored programs that include additional clinical and administrative resources to support providers.
Vatica’s clinical and admin resources can reduce PCPs’ burden from coding and documentation. That not only improves provider experience but keeps the PCP central to patient care, supporting the patient experience as well. Vatica helps PCPs address chronic conditions, identify care gaps to more easily resolve them and present the most accurate picture of the patient’s condition. An accurate picture results in appropriate reimbursement, avoiding over- and under-coding that impacts overall healthcare costs. This moves us in the right direction to achieve the Quadruple Aim and gives provider group leaders concrete resources to address physician burnout.
It’s an inescapable fact: The lower a person’s socioeconomic position, the worse their health. Research by the World Health Organization (WHO) has shown that non-medical factors—such as education, employment, food insecurity and housing—have a significant impact on the health disparity between rich and poor. In fact, it is estimated that up to 89% of the factors that influence health exist outside of medical care. These factors are known as Social Determinants of Health (SDOH).
Government agencies and healthcare providers alike understand the impact of SDOH and want to do something to close the gap. However, a 2022 survey showed that while 80% of care providers believe that addressing SDOH is essential to improving health outcomes and decreasing costs, 61% said they lacked the time and the ability to affect the SDOH of their patients.
If, like the care providers surveyed, you’re committed to addressing SDOH but feel ill-equipped to make a difference in the near term, read on to begin making progress against your SDOH goals.
Social screening needs to be a component of every patient visit. Screening tools, available through some EMRs and other sources, can help identify people in need within your patient population.
Master the codes
To ensure your clinicians and coders are up to date on the new Z codes, consider designating one staff member as your in-house SDOH expert and charge that person with following, disseminating and training colleagues on that information as it is updated.
Leverage payer resources
Health plans are also offering more direct SDOH support. For example, Anthem’s Member Connectprogram guides Medicare Advantage members to community health workers who help them find the community resources they need. This has increased healthcare engagement for 74% of members, resulting in an 8% reduction in hospital admissions and a 43% reduction in ER visits.
Build relationships with community resources
To drive better outcomes, it’s vital to connect patients to governmental and community resources that can help address their SDOH issues.
While referring patients to the appropriate programs is a good start, it is not enough; you should follow up to ensure they’ve made those connections. For that reason, it’s to everyone’s benefit for you to get to know and partner with community-based organizations (CBOs) to share information, ideas and issues and ensure referrals are followed up.
Emulate the successful methods of other care providers
The experiences of other providers may offer valuable lessons on what works and what doesn’t. For example, the University of Pennsylvania Health System discovered that offering patients a complimentary ride to an appointment did not lower patients’ 36% no-show rate. However, NorthPoint Health & Wellness Center of Minneapolis has seen success over the past 15 years by providing patients with bus tokens and hosting lunches with religious leaders of underserved communities. These and other actions have enabled NorthPoint to more than double vaccination and health screening rates to nearly 80%.
Addressing SDOH makes an impact
Taking proactive measures as described here will inform better decision-making and drive policies that work to undo the inequities in healthcare and lower costs for everyone. And when you build on those findings, using analytics to identify at-risk or in-need individuals, you can take the next step with outreach efforts that refer patients to relevant professionals and community resources.
Vatica Health can help. Our PCP-centric risk adjustment and quality of care solution combines technology with clinical consultants who review and curate all relevant health plan and EMR data. This results in a pre-visit notification that can help your team efficiently perform the visit, document patients’ health status and assist with care gap closure.
Interested in a more in-depth look at SDOH resources?Click here.
As regulatory pressure mounts, health plans face challenges that impact the operations, compliance and results of their risk adjustment and quality programs. It’s become evident that PCPs should be at the center of risk adjustment efforts, but for payers and ACOs, that is easier said than done.
In a recent webinar hosted by Vatica Health for members of the RISE Association, Margaret Paroski, MD, CEO of Catholic Medical Partners, and Brian Flower, vice president of client solutions at Vatica, discussed this topic. You can view the webinar or read on for highlights of the presentation.
Dr. Paroski and Brian agreed that the risk adjustment landscape changed more in the past six months than the past six years. The Office of the Inspector General (OIG) has made clear its focus related to risk adjustment is on single submissions made by someone other than the patient’s care team. Under the RADV Final Rule, coding accuracy and specificity is even more important due to increased fines and penalties. The implementation of V28 under the 2024 Final Rate Notice introduced significant changes to the risk adjustment model including a reduction in the number of diagnosis codes that risk adjust and a shift in coefficient weight for many conditions.
The need to document all active conditions annually has remained constant. Dr. Paroski noted that, for most conditions, the PCP is the best source for that information. Often, the PCP has been caring for that patient for many years and has access to critical clinical data in the EHR. “We ask that you give us resources to help us, don’t try to replace us,” she advised payers.
Benefit #1: maximize compliant coding capture
Dr. Paroski offered several suggestions for payers to help providers code accurately and compliantly. Timely, patient-specific data presented within the provider’s clinical workflow is critical. In contrast, Dr. Paroski noted that surfacing low-probability suspected conditions overwhelms and frustrates providers. In addition, provider education and training is very helpful. Brian agreed, noting that highly focused and practical training, instead of broad and general education, is often more effective.
Benefit #2: improved outcomes
Supporting the patient/PCP relationship with enhanced payer collaboration empowers compliant code capture, improved utilization management, patient adherence and holistic care. This model enables more comprehensive and targeted data accuracy at the point of care with the opportunity for PCPs to close gaps in care by enabling a provider-centric model for value-based reimbursement activity. Payers can support this approach by offering PCPs a clear strategy and sponsored solutions to progress in value-based care (VBC) payment models.
Dr. Paroski suggests health plans find programs that work and build them into VBC contracts. Give providers data that goes beyond risk and HEDIS/Stars data. For example, information on patients’ social determinants of health is extremely helpful to PCPs. Equally helpful are community resources to address these issues, which many payers now offer but PCPs may not be aware of. Conversely, when payers auto-assign members that the PCP has no record of, this wastes the provider’s time and causes frustration. Likewise, when payers offer poor visibility into the provider’s VBC performance, it does not help improve outcomes. More collaboration, communication and transparency between payers and providers drives more accurate and compliant results.
Challenge #1: PCPs are busy
Dr. Paroski used the analogy of an online meal prep and delivery service to describe how payers can help busy PCPs. Blue Apron assembles, preps and premeasures the ingredients so the recipient just needs to follow the directions and cook the meal. Payers should do everything they can to make coding and documentation simple and efficient for PCPS. Allow providers to work at the top of their license, reimburse the staff for additional time, effort and expertise, and support providers with clinical and administrative resources. For maximum efficiency, don’t interrupt the PCP’s day or revenue cycle, interfere with time spent seeing patients, or overburden the clinical staff.
Challenge #2: PCPs do not feel valued
The healthcare system is asking PCPs to take on administrative responsibilities unrelated to why physicians chose the profession. Physicians did not go to medical school to become super-coders. Dr. Paroski noted that payers can help by paying fairly and quickly, and sponsoring programs that support physicians. In addition, payers should examine leveling the playing field for house-call visits so that PCPs get paid a fair amount for their time completing a house call. Given the OIG scrutiny on coding submissions from outside of the patient’s clinical care team, involving the PCP in a home or virtual visit designed to capture HCC codes is preferred. Brian noted home visits initiated by the PCP have a higher success rate in terms of acceptance by the patient and continuity of care.
“Stay in your lane,” Dr. Paroski added. “Don’t carve us out of care decisions or support risk adjustment programs that work around us. We can help fill the potential erosion of HCC RAF scores in the shift from V24 to V28 given our strong relationships with patients and access to all relevant clinical data.”
Dr. Paroski and Brian highlighted these key takeaways for the payers attending the webinar:
Provide timely, accurate and useful data
Provide viable VBC contracts and a clear path for evolution of VBC
Do the work you can do to support PCPs and don’t interrupt providers’ workflows
Pay providers fairly and quickly for the work they do
How Vatica Health can help
Vatica Health is the #1 ranked PCP-centric risk adjustment and quality-of-care solution for health plans and health systems. By pairing expert clinical teams with cutting-edge technology, Vatica increases patient engagement and wellness, improves coding accuracy and completeness, identifies and closes gaps in care, and enhances communication and collaboration between providers and health plans. The company’s unique solution helps providers, health plans and patients achieve better outcomes, together. With the Vatica team providing the extra resources needed for complete, compliant coding and documentation, physician participation is easier to enlist and sustain. To learn more, visit https://vaticahealth.com/.
With the CMS RADV Final Rule and Final Rate Notice issued earlier this year, health plans are adjusting to the new coding guidelines and increased regulatory scrutiny over their risk adjustment activities. How can plans adhere to the new guidelines and maximize plan performance?
One way is through provider-centric risk adjustment practices. Putting providers at the center of the process and giving them the right resources helps optimize risk adjustment and quality performance. Provider centricity increases both provider and patient satisfaction because care can be better coordinated and care gap closure increased.
Bright Spots in Healthcare, moderated by host Eric Glazer, assembled an all-star panel well versed in risk adjustment to share best practices to drive strong performance in this changing environment:
Colleen Gianatasio, director, clinical documentation integrity and coding compliance, CDPHP
Michelle Illitch, vice president of network solutions and value-based programming, Priority Health
Gregg Kimmer, president and CEO, ATRIO Health Plans
Hassan Rifaat, MD, CEO, Vatica Health
Frank Shipp, executive director, Johns Hopkins Clinical Alliance
Watch the webinar to get the full story, but in the meantime, here are key pieces of advice from the panel:
Develop workflows to minimize impact on provider productivity
Risk adjustment can be a heavy lift for provider groups of any size according to Frank Shipp, who offered the provider’s point of view on the panel. Physician buy-in is the first step. Instill confidence by ensuring a seamless workflow, decreasing administrative burden, and reducing compliance exposure via education and regular feedback on the appropriateness and accuracy of their coding documentation. For minimal impact on workflows and provider productivity, assess your EMR capabilities and load as much data into the EMR as possible. Payer data is also helpful. At Johns Hopkins, payer data is loaded into the EMR. Credentialled coders conduct pre-chart reviews to “set the table” for the visit. This helps build trust and credibility. Shipp recommends identifying physician champions to support your program. These are often early adopters with an interest in risk adjustment.
View risk adjustment as a clinical function, not a revenue function
ATRIO’s Gregg Kimmer sees risk adjustment as a clinical function, rather than a revenue function. Because Medicare Advantage has no medical underwriting, knowing the acuity of your members early is important. That requires support from providers who maintain a treasure trove of invaluable clinical information. Develop a framework so your providers can document to the highest level of specificity and give payers the most accurate picture possible. Create a partnership where both parties win. Support providers before, during and after the encounter. Offer resources and solutions that allow physicians to work at the top of their license.
The best place for complete and accurate coding is with the PCP
Make sure the process fits into the provider’s workflow and minimizes time required and abrasion, advised Hass Rifaat. The media has alerted providers to the heightened liability associated with faulty risk adjustment initiatives. Therefore, payers need to educate and reassure providers about how risk adjustment works and how to mitigate fines and penalties. “A combination of technology, people and data works best to help PCPs improve accurate and compliant risk adjustment coding,” Rifaat noted. Provider organizations vary; you’ll need to offer different workflows and flexible options to accommodate provider preferences. One vital component that’s often overlooked is compensation. Share incentives with treating providers and their staff. Leverage the entire PCP staff to complete coding and documentation, including mid-level providers.
Take advantage of the EMR
Michelle Illitch represented Priority Health, the third largest provider-owned plan in the country. Illitch noted that while technology is key, how the technology is implemented and utilized is critical. She pointed out that although the EMR is not ideal for documentation, payers who access the EMR directly can avoid asking for charts and obtain the info they need. The payer can also handle much of the pre-visit work for the provider and act as a planning resource, but it’s critical that the data is accurate. “If you give providers inaccurate info for a patient, the damage is irreparable,” she noted.
Ensure integrity of the data for the PCP
CDPHP has built their own clinical documentation integrity program that benefits the health plan and its providers with timely, actionable and trustworthy data. “Our program unites people, process and technology,” Colleen Gianatasio noted. CDPHP gives providers a curated list of information to review after the visit, with a full circle clinical data integrity process, including chart review after the visit. The plan continues to improve the data and analytics. For example, the plan has separate HEDIS and risk adjustment teams. The teams have been cross trained for better coordination and collaboration with providers.
The role of member retention in risk adjustment
Too often, plans don’t consider the importance of member retention in their risk adjustment programs, according to Gregg Kimmer. If plans can’t retain their members, they won’t reap the benefits from the risk adjustment and gap closure work they are doing today. The industry standard for voluntary disenrollment is 5 – 8%. ATRIO keeps disenrollment rates below the industry average with a constant focus on member experience and satisfaction.
Does it really work?
Hass Rifaat has seen from experience that a provider-friendly solution that compensates providers for their time and reduces their burden with dedicated resources can be successful. Offer a payer-agnostic solution that providers can use at the end of the appointment, during lunch or after office hours. Vatica Health has found that approximately 50% of PCPs want the solution in their EMR. The other half prefer a separate solution they can do in batches after the patient encounter. Rifaat called out a common misperception that risk adjustment is all about making money for the payer. It’s helpful to educate providers about the Affordable Care Act guardrails for medical loss ratios. At least 85 cents of every premium dollar must be used for members’ medical care.
He offered a case study with a regional plan in the Northeast which made its RA solution mandatory for participating providers. After three years, 70% of eligible members had an annual visit to gather info for risk adjustment. The plan increased its premium revenue by 15%, resulting in more market-competitive products. That drove more payers to adopt the risk adjustment solution; 80% of MA lives are covered by the solution with 70% of all PCPs participating. Importantly, the plan saw six Star measures move from less than 4 stars to more than 4 stars in one year, which are associated with better patient outcomes.
Bring back the joy
Priority Health Plan strives to be a catalyst for pre-visit planning, according to Michelle Illitch. This includes rich claims feeds provided via technology in a smooth, consistent process. Priority recognizes that providers don’t think about “lines of business” like payers do. They scrub data so the provider’s workflow reflects patients who need care the most, regardless of line of business.
Illitch noted that providers “feel beaten up by health plans.” She recommended keeping the Quadruple Aim at the forefront of what you do. Don’t forget about the provider experience. Payers can help bring back the joy of medicine for providers.
How Vatica Health can help
The Vatica Health solution directly supports many of the recommendations made by the experts on the webinar. Vatica Health is the #1 rankedPCP-centric risk adjustment and quality-of-care solution for health plans and health systems. By pairing expert clinical teams with cutting-edge technology, Vatica increases patient engagement and wellness, improves coding accuracy and completeness, identifies and closes gaps in care, and enhances communication and collaboration between providers and health plans. The company’s unique solution helps providers, health plans and patients achieve better outcomes, together. With the Vatica team providing the extra resources needed for complete, compliant coding and documentation, physician participation is easier to enlist and sustain. To learn more, visit https://vaticahealth.com/.
By Brian Flower, vice president of client solutions, Vatica Health
On January 30, 2023, the Centers for Medicare and Medicaid Services (CMS) released the final rule on Risk Adjustment Data Validation (Final Rule). The rule includes several changes. The most consequential is the new RADV audit methodology used by CMS to address overpayments to Medicare Advantage plans based on the submission of unsupported risk-adjusting diagnosis codes. The final rule authorizes CMS to extrapolate RADV audit findings beginning with payment year 2018 (not 2011-2017 as originally proposed). The industry views the use of extrapolation as especially punitive because in the Final Rule, CMS also rejected the application of the FFS Adjuster to account for an allowable threshold of errors related to provider medical record documentation.
The financial implications of the Final Rule are significant. Prior to the Final Rule, repayment obligations were limited to errors found in a sample of a few hundred records. Under the Final Rule, that error would be applied across a broader population of the Medicare Advantage Organization’s contract. Recently, the Office of Inspector General (OIG) audited diagnosis codes submitted by a health plan for approximately 200 members. The OIG found a high percentage of codes were not supported in the medical record. This resulted in $480,000 in overpayments, though the health plan disputes the findings. The new extrapolation methodology would not apply in this instance because the alleged overpayments occurred in 2015 and 2016. If extrapolation did apply – instead of approximately $480,000 – the overpayments would result in an exponentially higher repayment amount of approximately $27 million.
What can we tell about the extrapolation method if we consider these figures with membership data of the MAO contract in question? Straight-line math indicates that for each dollar of overpayment identified in the RADV sample, there’s an additional $55 of overpayment under extrapolation.
We should be careful applying these assumptions to other populations, especially considering the highly targeted nature of this audit in question. The OIG targeted HCCs representing $695,000 in payments. Based on their review, 69% of those dollars could not be supported by documentation. However, what seems to be apparent is that an extrapolation methodology has been determined and, when applied, material payment modifications can result.
The financial implications for RADV error rates will no longer be limited in materiality to small sample populations. Extrapolated penalties will be significant and potentially catastrophic to payers as well as at-risk providers. CMS estimates that from 2023 through 2032, the agency will recover an extra $4.7 billion from insurers via the new audit methodology. Given this, at-risk entities should evaluate their current risk adjustment programs and focus on solutions that produce accurate and compliant yield. Programs should include a robust quality improvement process to validate coding and documentation prior to submission. Legacy programs, such as retrospective chart reviews and in-home assessments, should be augmented with a provider-centric approach. Leading plans recognize PCPs as partners in coding accuracy and complete documentation to mitigate the risks associated with the Final Rule and the overall increased scrutiny on risk adjustment compliance.
How Vatica Health can help
Vatica Health is the #1 ranked provider-centric risk adjustment and quality of care solution for health plans and health systems. By pairing expert clinical teams with cutting-edge technology, Vatica increases patient engagement and wellness, improves coding accuracy and completeness, identifies and facilitates the closure of care gaps, and enhances communication and collaboration between providers and health plans. The company’s unique solution helps providers, health plans and patients achieve better outcomes, together. Vatica Health is trusted by many of the leading health plans and thousands of providers nationwide. For more information, visit vaticahealth.com.
By Jamie Jenkins, PhD, MBA, CPHQ, quality of care director, Vatica Health
Advancing health equity is the first pillar of Centers of the Medicare and Medicaid Services’ (CMS) strategic plan. The Biden-Harris administration has committed to promoting racial equity through government programs focused on underserved communities. To that end, CMS’ 2023 Medicare Advantage Quality Rule released in April 2023 finalized the new Health Equity Index (HEI) for measuring how well Medicare Advantage and Part D plans manage at-risk populations.
What is the index?
The HEI will drive health plans to fully engage and take steps to address the social determinants of health (SDOH) which negatively impact health quality and outcomes.
CMS has defined HEI as an index or single score that encapsulates contract performance for plans whose enrollees face specific social risk factors. The index will use existing data to limit the number of members who are identified as vulnerable. Stratified plan members who receive a low-income subsidy, those with a disability and those who are dual eligible will be in the scoring pool. Health plans should begin analyzing their data and designing programs to support these members.
What are the goals?
The initial goal of HEI is to increase transparency and understanding of plan performance in addressing the needs of members facing social risks. First, the index will be used to identify populations with the greatest needs so that targeted assistance may be granted to communities and providers serving those communities.
Second, the HEI will allow beneficiaries to select plans based on performance on health equity measures. Third, the index would become part of the Star Ratings program which is used to incentivize health plans with bonuses to improve performance. Prior to this new approach, there were no targeted incentives to address disparities among a plan’s enrollees. The HEI would be an added layer encouraging investment in health equity initiatives for Part C and Part D Star Ratings.
Call to action
Health plans have time to begin examining their approaches. The baseline data for the initial calculation of the HEI will be based on calendar years 2024 and 2025. The performance reward will be included in the 2027 Star ratings year.
Health plans can start their data analysis by comparing contracts to one another. For example, plans may consider the variances between those populations receiving a low-income subsidy versus those who are not. Comparing groups will allow plans to determine where support is most needed.
Data collection is key
One of the five priorities outlined by CMS in the framework is expanding the collection and analysis of standardized reporting. The agency seeks comprehensive, interoperable and standardized individual-level demographic and SDOH data. With an increased understanding of members’ needs, CMS plans to leverage quality improvement and other tools to ensure all members have access to equitable care and coverage.
CMS notes that developments in health information technology have improved the ability to collect health data and measure disparities at the provider level. Vatica Health, for example, provides technology and dedicated clinicians to enable providers to efficiently capture more accurate and complete diagnostic coding and documentation both for risk adjustment and improving quality of care. Vatica’s team of nurses curates relevant clinical data from various sources and creates a pre-encounter provider notification to enable more comprehensive encounters. The notification lists medical conditions, unreconciled medications and targeted quality measures to help the provider efficiently address the patient’s needs during the visit. As part of this process, Vatica can collect race and ethnicity information as well, using CDC specifications.
In summary, this framework is the first step in CMS’ drive toward improving health equity. “Our goals for Medicare Advantage mirror our vision for CMS’ programs as a whole, which is to advance health equity; drive comprehensive, person-centered care; and promote affordability and the sustainability of the Medicare program,” said CMS Administrator Chiquita Brooks-LaSure.
How Vatica Health can help
If you are considering a partner to help improve your Star quality measure performance, consider Vatica Health. We are the #1 rated risk adjustment and quality of care solution for health plans and health systems. By pairing expert clinical teams with cutting edge technology, Vatica increases patient engagement and wellness, improves coding accuracy and completeness, identifies and facilitates the closure of care gaps and enhances communication and collaboration between providers and health plans. The company’s unique solution helps providers, health plans and patients achieve better outcomes together.
By Steve Zuckerman, cofounder and chief strategy officer, Vatica Health
Over the last several months there have been dramatic regulatory changes that will have a significant impact on Medicare Advantage Organizations (MAOs). The Centers for Medicare and Medicaid Services (CMS) made sweeping changes to both the audit process and underlying risk adjustment model, based on concerns with coding of conditions that the government claims are not credible predictors of future expenditures. These changes are against the backdrop of a wave of lawsuits and reports by the Office of Inspector General (OIG), alleging billions in overpayments emanating from legacy risk adjustment models such as chart reviews and home assessments.
Risk adjustment is the foundation of Medicare Advantage (MA). It’s a necessary but complicated process that ensures at-risk entities have sufficient funding to provide the appropriate care and resources to members based on their clinical profiles. As membership in MAOs has steadily increased over the last decade, so have the costs, leading to recent reforms. The first blow occurred on January 30, 2023, when CMS released the final rule on Risk Adjustment Data Validation (RADV Final Rule). This rule authorizes CMS to extrapolate RADV audit findings across a health plan’s entire membership base. The practical effect is that audits will be more frequent, and the new extrapolation methodology will likely result in much more significant fines and penalties (CMS estimates it will collect $4.7 billion more from plans over the next 10 years).
The government’s next initiative to address coding errors and variations occurred on March 31, 2023, when CMS released the Calendar Year 2024 MA Capitation Rates and Part C and Part D Payment Policies (Final Rate Notice), which shifts diagnosis coding from ICD-9 to ICD-10 and removes over 2,000 codes from the Hierarchical Condition Categories (HCC) model. Despite a massive industry-wide lobbying effort from both payers and providers, the new risk adjustment model was adopted. However, CMS did agree to a phased-in approach over three years which represents a meaningful concession.
Finally, on March 27, 2023, a bipartisan senate bill was introduced by Sens. Bill Cassidy, R-Louisiana, and Jeff Merkley, D-Oregon, entitled the “No Unreasonable Payments, Coding or Diagnoses for the Elderly Act.” This bill seeks to exclude diagnoses from chart reviews and health risk assessments in the calculations of a patient’s risk score. While the bill is in the early stages of consideration, it is consistent with the prevailing perspective and momentum away from legacy models and toward involving treating providers in the risk adjustment process.
The phased-in approach under the Final Rate Notice gives MAOs an important opportunity to review their risk adjustment solutions to make sure they will be effective under the new regulatory landscape. Here are a few practical strategies to consider:
Provider-centricity will be more critical than ever. As we transition to value-based care, it is critical for payers and primary care physicians (PCPs) to work together to improve care, outcomes and costs. Accurate risk adjustment is essential to ensure appropriate care for MA patients, the fastest growing healthcare segment. Therefore, it stands to reason that payers and providers should collaborate on risk adjustment and quality initiatives. Further, given the loss of several valuable HCCs under the Final Rate Notice, it will be more important than ever to ensure the capture and clinical substantiation of all risk adjustable conditions. Legacy models are deficient, work around providers, disrupt continuity of care and don’t accompany patient care plans. A better approach is to empower the PCP with tools and resources to perform HCC coding because the PCP has an existing relationship with the patient, direct knowledge of the patient’s history, and real-time access to the patient’s medical records. Enhanced payer and provider collaboration in this regard can produce better clinical and financial performance.
Reevaluate chart reviews and home assessments. Chart reviews and home assessments that lack connectivity to the PCP and don’t impact care are being targeted by the Department of Justice, CMS and OIG. Both may become obsolete if the “No Upcode Bill” is ultimately passed. Lack of clinical oversight and perverse incentives within these legacy risk adjustment models create an environment ripe for error and malfeasance. Another major concern is that they are not coordinated with treating providers and therefore have minimal impact on improving overall population health and value-based care performance. Consider ways to coordinate your chart review and home assessment programs with in-office solutions to keep PCPs at the center of care.
Focus on accuracy. In light of the RADV Final Rule and the myriad of lawsuits and investigations, at-risk entities should invest in solutions that produce compliant yield. They should focus on improving accuracy and completeness of documentation and coding and include a QI process that reviews both additions and deletions to validate coding prior to submission. The shift to value-based care will put even more pressure on payers and providers to use compliance-centric solutions that are focused on improving the accuracy and completeness of diagnoses codes and documentation.
How Vatica Health can help
Vatica Health is the #1 rated risk adjustment and quality of care solution for health plans and health systems. By pairing expert clinical teams with cutting-edge technology, Vatica increases patient engagement and wellness, improves coding accuracy and completeness, identifies and facilitates the closure of care gaps, and enhances communication and collaboration between providers and health plans. The company’s unique provider-centric solution is used prospectively at the point of care, giving the provider control and ensuring continuity of care. The solution helps providers, health plans and patients achieve better outcomes, together. Vatica Health is trusted by many of the leading health plans and thousands of providers nationwide. For more information, visit vaticahealth.com.
By Brian Flower, vice president of client solutions, Vatica Health
The Centers for Medicare and Medicaid Services (CMS) released on January 30 the long-awaited final rule on Risk Adjustment Data Validation (RADV). The rule includes two significant modifications to the RADV audit methodology used by CMS to address overpayments to Medicare Advantage plans based on the submission of unsupported risk-adjusting diagnosis codes. First, the final rule authorizes CMS to extrapolate RADV audit findings beginning with payment year 2018 (not 2011-2017 as originally proposed) but did not elaborate on the extrapolation methodology. Second, a fee-for-service (FFS) adjuster will not be applied to RADV audit results, which was previously leveraged as a method of normalizing Medicare Part C payment errors against fee-for-service Medicare.
Industry leaders and health plan advocates have expressed concerns. Matt Eyles, president and CEO of America’s Health Insurance Plans, said, “Our view remains unchanged: this rule is unlawful and fatally flawed, and it should have been withdrawn instead of finalized. The rule will hurt seniors, reduce benefits for those who choose MA, and yield fewer plan options in the future.”
Health plans had similar reactions. “While we all can agree that improvements can be made, the failure to adjust for the legitimate differences between Medicare Advantage and original Medicare will have a detrimental effect on the seniors and people with disabilities who rely on the Medicare Advantage program,” the BCBS Association said. “CMS should have implemented a narrower solution aimed at a few bad actors, but instead this overreaching regulation will raise costs, reduce choice and make it more difficult for seniors and those with disabilities to effectively manage their health.”
As analysis of the rule continues, here are a few insights and practical strategies we have shared with our payer and provider clients.
Assess your “thin HCC” risk Even while the focus remains on accurate submissions, some HCCs will be easier to substantiate than others in an audit. It is important to understand what percentage of your submissions and Risk Adjustment Factor share would qualify as “thin” (associated with only one or two encounters, especially if significant effort is required to obtain a valid medical record). Understanding your risk will inform decision making on remediation within and after a given measurement period, as well as financial planning.
Prioritize treating providers Invest in programs that inform treating providers and empower them to code directly and accurately in a consistent and submittable manner, in favor of downstream coder abstraction that is not associated with the patient’s care plan. Engaged providers will become better organic coders over time, and a structured process can ensure necessary supporting documentation is reliably collected. In addition, compliant conditions collected shortly after encounters are recognized earlier than retrospective coding, allowing plans to identify open revalidation candidates within, instead of after, the measurement period.
Anchor on primary care The clinical benefits of encouraging a strong patient-to-PCP relationship are largely understood. Build a risk adjustment strategy that recognizes PCPs as partners in accuracy and quality capture as well. PCPs are your starting lineup for long-term chronic care management, medication compliance, specialty referrals and testing needed to fully assess many HCCs.
Engage the member As scrutiny over coding escalates, payers and providers should collaborate on member engagement to ensure annual visits are performed so that chronic conditions can be properly managed, as well as documented. Medicare Annual Wellness Visits (AWVs) are a great opportunity to engage patients in preventive care. AWVs can also be used as a springboard to participate in health plan-sponsored programs designed to capture accurate clinical documentation and close risk and quality care gaps. This expanded scope, which Vatica Health has dubbed an “Enhanced Wellness Visit,” ensures appropriate care and reimbursement while enhancing performance under value-based care arrangements.
Focus on accuracy above all else The final rule can result in more severe penalties, as well as myriad legal actions against payers and providers relating to alleged improper practices focused on boosting risk scores and associated payments. In light of this, at-risk entities should evaluate the compliance (real and perceived) of their current risk adjustment solutions. Consider solutions that produce compliant yield, focus on improving accuracy and completeness of documentation and coding, and include a QI process to validate coding prior to submission.
How Vatica Health can help
Vatica Health is the leading provider-centric risk adjustment and quality of care solution for health plans and health systems. By pairing expert clinical teams with cutting-edge technology, Vatica increases patient engagement and wellness, improves coding accuracy and completeness, identifies and facilitates the closure of care gaps, and enhances communication and collaboration between providers and health plans. The company’s unique solution helps providers, health plans, and patients achieve better outcomes, together. Vatica Health is trusted by many of the leading health plans and thousands of providers nationwide. For more information, visit https://www.vaticahealth.com/.