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Patient health risk status and risk adjustment is one of many value-based care factors (including cost, utilization, and patient satisfaction) that are driving new models of physician/provider payments. Payers are utilizing Hierarchical Condition Category (HCC) codes to assess the severity of illness (risk) of patient panels. Then they adjust reimbursement-based patient risk. A payment model mandated by CMS in 1997 and originally created to estimate future costs for a patient, HCCs were designed to identify patients with serious or chronic illnesses and to then assign a risk factor score to the person based upon a combination of a patient’s health conditions and demographic details.
