Are Risk Adjusted Plans Getting a Makeover?

by  Aimee L. Wilcox, CPMA, CCS-P, CST, MA, MT
Feb 15th, 2022

It seems there is an ever-increasing number of healthcare payment models coming from the Centers for Medicare and Medicaid Services Innovation Center (CMMI). The CMMI was established with the passing of the Affordable Care Act (ACA) many years ago and has been responsible for developing and implementing more than 50 new healthcare payment models since its inception. Of the original 50 models, 28 remain active today with rules and payment processes continuously changing. CMMI has been tasked to develop, implement, and assess the data and success rates of the various healthcare payment models in an effort to:

• improve patient care
• lower costs
• better align payment systems to promote patient-centered practices

Alternative payment models (APMs) were, and continue to be, created in an effort to meet these needs and are meant to reward participating healthcare providers who show that they can deliver high-quality, efficient, and cost-effective health care. Some models focus on certain types of care such as:

• end stage renal disease (ESRD)
• joint replacement surgery (e.g., knee, hip) referred to as care episodes
• specific provider types who deliver primary care (e.g., primary care, internal medicine)
• community health care in rural areas
• innovative changes within Medicare Advantage or Part D Medicare

Currently, no new payment models are planned for implementation in 2022; however, several new models and major revisions of the risk adjustment models are being considered for implementation in 2023. Concerns have been expressed by many different parties about the Medicare Advantage risk adjustment payment model and thus plans for revisions to this program have been discussed in depth.

Each year the Office of Inspector General (OIG) publishes a work plan that outlines the various types of services and healthcare plans or models that will undergo increased scrutiny and audit investigations to ensure federal funds are being spent appropriately and not fraudulently. 

Lately, a rather large number of commercial Medicare Advantage payers have been under investigation for accusations of fraudulent upcoding of diagnoses in an effort to obtain additional reimbursements. CMMI develops, implements, and revises these APMs in an effort to ensure that innovation is centered around care delivery, quality of care, and cost effectiveness but payers appear to continue to find better ways of gaming the healthcare system.

CMMI plans to shift the focus of its payment models more towards the delivery of quality care and equity among beneficiaries while eliminating the types of fraudulent upcoding providers/payers have been involved in to obtain higher payments without actually delivering the level of care being reported. Accomplishing this feat requires expanding the number of qualified auditors and investigators to ensure vigorous audit investigations of payers and providers. As always, they will also be armed with data analytics which give them the ability to quickly identify payers and providers who are outliers in their fields and initiate investigations beginning with them. 

In 2023, CMMI’s mission will be focusing on improving patient care, lowering costs, and promoting patient-centered practices while creating equity among beneficiaries. The hope is that this extra attention will reduce fraud and advance the quality of care for beneficiaries with providers and payers sharing any associated risk.

As always, it is important for healthcare organizations to stay abreast of any planned changes, especially any focused audits or investigations currently taking place. To review the various innovation payment models established and currently functioning through CMMI, click HERE. Additionally, make time to review the OIG’s 2022 Work Plan and compare it with your internal compliance policies to see how your organization would fare if they were to undergo an investigation for the same services. 

About Aimee L. Wilcox, CPMA, CCS-P, CST, MA, MT

Aimee L. Wilcox is a medical coding, billing, and auditing consultant, author, and educator with more than 30 years of clinical and administrative experience in healthcare, coding, billing, and auditing. Medicine, including coding and billing, is a constantly changing field full of challenges and learning and she loves both. Aimee believes there are talented medical professionals who, with proper training and excellent information, can continue to practice the art of healing while feeling secure in their billing and reimbursement for such care.