Hierarchical Condition Categories Require Proper Documentation for Success

Hierarchical Condition Categories, or HCC, were established in 2004 by the Centers for Medicare and Medicaid. This model is used in order to change the capitation payments that are paid to health insurance providers for an anticipated cost for Medicare or Medicaid enrollees. Each hierarchical condition category is assigned to a specific health condition. Through the use of a number of different categories, the Centers for Medicare and Medicaid allot a specific amount of money for each category that applies to an enrollee.
Because of the accumulative nature of the model, each patient who is enrolled is able to have more than one category applied to their plan. Some of the chronic conditions that are commonly assigned using this system include Diabetes, Chronic Obstructive Pulmonary Disease, Breast Cancer, Heart Disease and Angia. Medicare’s hierarchical condition categories consist of 70 different categories, each which are assigned to corresponding diagnostic codes.

In order for patients to be able to take advantage of the HCC model, proper documentation of clinical diagnosis by health care providers is necessary. This is because the Medicare Advantage program will supply health care providers with resources per each category when it is properly documented within medical records. When the face to face doctor patient interactions are properly documented, especially in the case of chronically ill patients, the health care provider will receive more reimbursement and resources from the Centers for Medicare and Medicaid. Poor documentation is the leading issue with this type of compensation model within the Medicare Advantage plans.