Trends in Risk Adjustment Coding Operations

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Summary

Plans adapt to market changes in risk adjustment coding. Interviews with plan professionals reveal three trends for efficiency, effectiveness, and compliance.

Health plans use member charts collected from providers to evaluate clinical evidence of submitted diagnosis codes for risk adjustment. Proper and effective coding operations are critical for both (1) ensuring that plans have sufficient documentation to substantiate diagnoses submitted for risk adjustment and (2) obtaining the most accurate and holistic view of their members to improve care and services. Avalere conducted in-depth interviews with seven experts responsible for overseeing coding operations, ranging from small to large plans. Through our discussions, combined with our industry experience, we have identified the following themes in coding for risk adjustment: 

Theme 1: Plans are increasingly raising the bar for coder accuracy requirements as part of regular performance monitoring. 

Requiring coders to maintain an accuracy rate of 95% or higher has been typical in the industry. However, a 96–97% accuracy rate is becoming more common, particularly as the stakes become higher in risk score accuracy. Plans typically audit and test coder performance anywhere from annually to as frequently as monthly depending on the health plan’s size and available resources. 

Theme 2: Provider engagement is an important aspect of coding operations. 

Health plans regularly offer education and support to providers and their coding staff to improve their coding and documentation practices. Plans rely heavily on provider engagement, education, and adequate documentation to meet regulatory and policy standards to strengthen their risk adjustment operations. In practice, coders will adhere to official guidelines utilizing industry standard approaches such as Monitoring, Evaluation, Assessment, Treatment (MEAT) or Treatment, Assessment, Monitor/Medicate, Plan, Evaluate, Referral (TAMPER) to determine which conditions should be reported during patient encounters. Health plans with robust analytics can tailor provider outreach and education by identifying providers prone to risks (e.g., evidence of highest error rates, documentation errors, coding errors)  

Theme 3: Plans are looking to integrate analytics into their compliance programs. 

Plans are increasingly interested in improving their analytic capabilities to use their data to identify possible areas that will reduce financial and legal risks. Sophisticated software and enhanced analytic capabilities offer preventive pathways that can identify inaccurate coding or unsupported documentation, thereby reducing risks and adequately preparing a plan for potential HHS-OIG audits. These types of analytics capabilities should consider the member’s total clinical profile and longitudinal record. They can be a valuable tool as part of overall compliance programs to proactively monitor for risk areas and inform solutions. 

Health plans should consider evaluating their coding operations regularly to assess and improve operational efficiencies, maintain compliance with current guidelines and state and federal laws, and to effectively set and achieve plan goals. 

To learn more about how to implement industry best practices in risk adjustment coding and how Avalere can help, connect with us. 

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