Risk Adjustment Changes for 2014

CMS has announced a new CMS-HCC Model for payment year 2014 in their combined  Announcement of Calendar Year (CY) 2014 Medicare Advantage Capitation Rates and Medicare Advantage and Part D Payment Policies and Final Call Letter, published April 1, 2013.  You can download a copy of the ICD-9 codes that CMS released at the time of the Advance Notice [here].  CMS has not informed us of any changes in this listing, but we will advise you immediately if they do.

Important provisions of the announcement, related to Risk Adjustment:

•                          Clinically Revised CMS-HCC Model.  CMS will implement the new risk adjustment model, but will phase-in changes over a two year period.  In 2014, CMS will blend 75 percent of the 2014 model risk score with 25 percent of the 2013 model risk score.  The new model will be fully phased-in by January 1, 2015.

 

•                          Medicare Enrollee Health Risk Assessment.  As we noted when the Advance Notice was published, CMS is considering excluding from risk adjusted payment any diagnosis data collected from MA enrollee Health Risk Assessments which are not confirmed by a subsequent clinical encounter.  CMS planned to collect flags in 2013 of these risk assessments.
Based on comments received, CMS is delaying the collection of flags until calendar year 2014.  Further determination about exclusion of these data will be published in the 2015 Advance Notice

 

•                          Coding Intensity Adjustment.  The Coding Intensity Adjustment for 2014 is 4.91 percent.

 

•                          Normalization Factor.  Because 2014 payment will be based on a blend of the old and new CMS-HCC Models, there will be two normalization factors:

• 2013 CMS-HCC model: 1.041.

• 2014 CMS-HCC model: 1.026.

 

You can review all of the changes for 2014 in the Announcement, posted [here].   Look for new training programs to help SCAN providers understand the changes to the model on HCC University soon!