Medical practices are assessing the impact of the change in the HCC model from V24 to V28, a phased in change that begins in 2024.

CMS pays Medicare Advantage (MA) plans using Hierarchical Condition Categories (HCCs), and many private payers and ACOs use the HCC model for risk adjustment. Briefly, Medicare pays MA plans more for patients with a higher disease burden, as measured by their risk score – (Risk scores also include demographics and geographic location). In recent years, based on Office of the Inspector General (OIG) audits, CMS has come to believe there is upcoding being done by MA plans. And, naturally, they have implemented changes for 2024.

• Slides
• CMS V24 and V28 mappings_PY 2024 proposed

In 2023, MA plans are paid on the 2020 version, V24. CMS proposed changing to V28 ( a few versions have been skipped) starting January 2024 but compromised of phasing in V28 over three years.

Why do we care? The change will very likely decrease overall risk scores.

• The number of HCC categories will increase from 86 to 115, and categories will be renumbered.
• A change to a very commonly reported condition is diabetes, which has decreased values in V28. Some categories are eliminated entirely. V28 assigns a risk score to 2,264 fewer diagnosis codes.
• The current HCC categories were developed using ICD-9-CM codes. (Revised to ICD-10-CM on October 1^st 2015) The new categories are built around the structure of ICD-10-CM codes and use the clinical concepts in that coding system.

Does this mean you will change your current diagnosis coding practices? No, of course not.  It means that the risk score that is calculated for an individual patient or a panel of patients will change, and could decrease, as V28 is phased in.

Conditions not included in V28.

• Conditions that didn’t accurately predict cost.
• Coefficients (risk scores) were small.
• Conditions were uncommon.
• Conditions didn’t have well-specified diagnostic coding criteria.

Key points: V28

• The number of of HCC categories increases from 86 to 115.
• Assigns risk scores to 2,294 fewer codes.
• Current HCC categories were developed based on ICD-9-CM; V28 uses ICD-10-CM structure.
• Takes advantage of clinical concepts in ICD-10-CM.
• Some common conditions will no longer map to a risk score.
• V28 uses “constraining” meaning related HCCs are given the same coefficients.
• One example: diabetes uncomplicated, with acute complications and with chronic complications now have the same coefficient (slightly higher than current diabetes uncomplicated, lower than with complications).
• Will result in a decrease in overall risk for patients with diabetes.
• 268 codes that did not map to an HCC category in V24 will map in V28.
• Some codes are from Ch. 16, “Certain conditions originating in the perinatal period,” and Ch. 17, “Congenital malformations, deformations and chromosomal abnormalities.”
• Do not represent conditions common in Medicare patients.
• Will be a help for risk scores for commercial groups.

Need a refresher on risk adjustment? Watch our webinar or download the risk guide.  The risk guide uses V24 values—watch for our update.