MEDICARE RISK ADJUSTMENT: CODING AND CONCEPTS – BY DR. SINGH

MEDICARE RISK ADJUSTMENT: CODING AND CONCEPTS – BY DR. SINGH

February 07, 2017

To understand MRA, one may wish to understand where healthcare is moving. In my mind, MRA as part of coding is as integral to standardizing healthcare, auditing, billing and collections, such as CPTs or ICDs, Star rating, PQRS, HEDIS criteria, etc. We are seeing greater objectivization and benchmarking in services that had hitherto been subjectively evaluated for efficiency and results.

What does this do to the normal practice? It gives, at first glance, the opportunity to compare apples to apples. Thus, if each healthcare service can be measured on the same terms, such as severity of illness, intensity of intervention, goals achieved, customer service, compliance, and utilization management, there is an even playing field where everyone becomes equal. However, to me, it appears that this now counter-intuitively pits apples against lemons. The “lemons” are those practices who refuse to play catch up, refuse to learn documentation and coding, and insist on staying with the old-fashioned beat-up path of healthcare that has failed miserably in the past.

But for those who are willing to stay ahead of the curve, it is a chance to shine not only as apples but as the finest and select piece de resistance fruit on the table. Simply put, it is the chance for those who are nimble, eager to learn, and willing to put processes in place that improve and measure health services to blaze the trail and take a lead in the healthcare industry. Those who stay behind will be road-kill. This may sound shocking and stark, but the market can be unforgiving, and the business model of the new healthcare might be ruthless.

No longer will the provider be given unlimited powers and complete freedom to code and bill as they deem fit as they have done in the past few decades. If services for HHC, SNF, and hospital care are to measure up to this strict criteria, the provider will be put to the test. And if they are not prepared for the new demands of the system, there might be significant penalties or losses from recoveries by the government.

The old managed care had essentially fixed premiums, no matter how sick the patient was, and the only way to increase profits was to pay less to providers, improve contracts and utilization, or deny care by refusing to treat illnesses or dumping sicker patients (what used to be called cherry-picking the healthier population).

The newer managed care paid more for sicker patients, for improved documentation, coding and billing, and ensuring that claims reached CMS via the HMO. The way to increase profits was not only to reduce expenses but also by increasing premiums (what might be called cherry- picking the sicker population).

The 'Third Wave' in managed care introduces some more changes where Star Ratings, Customer Satisfaction, and HEDIS criteria become more and more important. This ties MRA to Utilization for proper data reporting, review, and analysis. This, in turn, ties all of these requirements into a strong compliance system, care management, customer service, ACOs, and Medical Homes. The field is evolving rapidly, but providers can significantly overlap in several new initiatives which are overseen by the same agencies. No wonder FMQA is certifying Medical Homes, ACOs, and the indicators for meaningful use. Reporting criteria for Medical Homes and ACOs have significant similarities.

You cannot manage what you cannot measure. This is an old axiom, but this was not the case under the older systems. However, now it is quite clear that the government has created the tools to measure the efficacy of managed care, allowing the more efficient practices to be more profitable, and created opportunities to save on wasted resources. At least, so the theory seems to be. In practice, what will separate the men from the boys (or women from the girls), will be a successful implementation of strong systems which will capture the MRA diagnoses and capture them correctly.

As we see the increasing standardization and objectivization of medical care, we will also see another phenomenon, which I call the “subjectivization of healthcare.” By this I mean, when parameters are created by which, in theory, one practice can be gauged against the next and these findings can be easily posted and shared on the internet and other media, customers will clamor for those practices which can be distinguished for going that extra yard, providing that additional touch of customer service, or providing the “healthcare experience,” akin to the Disney experience or the Apple gestalt.

How to succeed with MRA? In my opinion, these are some of the basics that will need to be implemented in any practice that intends to “hang ten” on this new wave:

  • Constant education and training of the providers (including specialists), staff, auditors, and billers.
  • Creating a partnership with specialists, vendors, IT systems, and, again, the plan.
  • Implementing a system to retrospectively check the chart on a constant basis and bring codes forth.
  • Mandatory compliance training and certification of every employee at least annually.
  • Use a utilization management software and system that ties all the data together making it actionable and becomes the pivot for all the services provided to the patient whether it is inside or outside the practice.
  • A data collection system, including getting all the hospital records, discharge summaries, consults, labs, radiology reports, etc. into your client's record.
  • Incentivizing physicians to improve the overall quality of care and compliance testing.
  • Focusing intensely on customer service and experience and educating the patients about their conditions and healthcare status.
  • Developing special needs plans and specialty clinics.
  • Getting a constant feedback from the plan about the MRA scores of the practice, patient by patient, and constant updating of one's data portals.

A strong MRA push is part of the overall compliance program and cannot be ignored in this era of rising healthcare costs and decreasing revenues.


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