Radio Recap: The role of CDI in risk-adjustment

As the healthcare industry shifts from traditional fee-for-service to a value-based and quality-driven model, CDI specialists should be aware of the principles that drive risk adjustment payments. “I describe it as traveling down parallel to that which we travel to establish the DRG,” says Laurie Prescott, MSN, RN, CCDS, CDIP, CRC, CDI Educational Director for ACDIS and BLR Healthcare in Middleton, Massachusetts, during the August 10 ACDIS Radio program.

Patients bring their own medical complexity, and CDI specialists must make sure that the documentation captures those complexities. Each patient has their own level of risk, Prescott says, which includes the severity of illness and expected cost to manage their care needs. 

For example, take an 85-year-old woman who lives at home, participates in aerobic dance and yoga twice a week, is a non-smoker, and her only comorbidity is osteoporosis. This patient will have a very different rating in risk adjustment than an 87-year-old who lives in a skilled nursing facility, is diabetic, has a history of stage 4 chronic kidney disease, and chronic obstructive pulmonary disease with a history of smoking. This higher risk adjustment score reflects the higher cost of care we are expected to expend due to the higher severity of illness.

Many quality measures included in CMS’ hospital value-based purchasing program are risk-adjusted, including 30-day mortality and 30-day readmissions, says Prescott. “We want to make sure that we’re capturing [documentation] for risk adjustment, which is very different methodology.”

The most common methodology used in risk-adjustment is the CMS Hierarchical Condition Categories (HCCs), says Shannon McCall, RHIA, CCS, CCS-P, CPC, CPC-I, CEMC, CCDS, CRC, director of HIM/Coding for BLR Healthcare. HCCs share many similarities to the DRG system CDI specialists are used to working with. Both are prospective systems, meaning there are pre-determined payments for different diagnoses, and both use diagnostic information to drive either the overall assigned DRG or HCC. However, HCCs are cumulative in nature—all you need is one heavily-weighted diagnosis to boost the DRG for a singular inpatient admission, but, with HCCs, diagnoses are extrapolated for many encounters for that beneficiary for a time period (e.g. year) that contribute to the total patient risk score. Procedures don’t affect HCCs like they can for DRGs, says McCall. HCCs are solely diagnosis-driven, an ideal fit for CDI specialists who typically focus on diagnoses for documentation improvement. 

Chronic conditions for risk-adjustment have a much bigger role in HCCs than DRGs, where most chronic conditions have little impact on reimbursement, says McCall. Take heart failure, for example. In the MS-DRG system, the CDI specialist may find an opportunity to query for added specificity for systolic or diastolic, as well as acuity to optimize the DRG. However, for risk adjustment, the documentation of heart failure in the record yields a HCC even without the additional specificity.

The common misconception is that HCCs apply to the outpatient setting only. This is not the case, according to McCall. Documentation to support a condition assigned to an HCC can come from outpatient, inpatient, and professional service documentation. Payers look at documentation from every setting for the reporting period for each beneficiary to determine whether a diagnosis should have been reported and is supported in the documentation.

“CDI specialists have to get used to looking at the record as a whole,” says McCall.

While conditions count toward a patient’s HCCs regardless of treatment setting, documentation and coding specialists need to follow the coding rules applicable to the setting in which the patient was treated and services were provided. Depending on the setting (outpatient or inpatient), documentation requirements for certain diagnoses in the HCC methodology will differ.

“From a rules standpoint, coding guidelines differ depending on setting and services,” says McCall. “CDI specialists need to be familiar with what diagnoses were documented, what setting they were provided in, and then apply the coding and documentation rules for that setting.”

For facilities looking to expand into risk-adjustment, Prescott says first identify which diagnoses “will map” to HCCs. Go to the CMS.gov website to find comprehensive HCC information, including lists of codes and how each maps to which HCC and its value. While self-study may seem intimidating, it is a great first step, Prescott said.

“Traditionally, the main focus of CDI is principal diagnoses and sequencing correctly,” says Prescott. “In HCCs, sequencing isn’t something we worry about.  We want to capture all of the appropriate diagnoses, and review records for missing or vague diagnoses. This is what CDI has been doing all along.”