Exchanges – Risk Adjustment – Ladies and Gentlemen, Start Your Engines

Seriously, the first question is, “what do you have under the hood for risk adjustment in your health plan?” If you’re running a stock claims engine that merely matches up with your enrollment file for CMS Edge Server processing, and you don’t have a risk adjustment operation, you may be breathing fumes from your competitors. Now, for health plans accustomed to competing against each other, we have a new type of competition. Further, it’s not just plans on the Exchanges, it’s all health plans on or off the Exchanges. Up to now, health plans have been competing for market share on the basis of premiums, benefits or brand; but with Exchange risk adjustment, competition takes on new meaning. You can gain or lose dollars. Some plans will transfer dollars to competitors on the market share they painstakingly managed to enroll. Ouch!

The process is very much underway at CMS with Edge Server testing. Plans are calibrating their systems. This means passing CMS testing for submission of test files, as well as understanding processing for acceptance and rejection of individual claims. Health plans must submit their first production by December 5, 2014. Beginning in mid-December, CMS will provide the first estimate reports to health plans for their review and feedback. After that, CMS will process files monthly until the final processing that occurs in May 2015, when risk scores are finalized for 2014. By July 2015, CMS expects to notify plans of any payments due when their risk scores indicate lower risk. For those receiving dollars, getting risk score payments will be no accident. So, while appeals can be filed, the process is upon us and, it will be too quick for any plan giving up dollars.

Right now, most plans’ IT staffs are clarifying processing details. However, it is clear that some IT staffs are struggling with the basics, indicating few supports and a lack of horsepower in their risk adjustment engines. Most likely, these are plans that are not offering products on the exchange, and have limited familiarity with CMS requirements. To say they are back of the pack in this new form of competition, and have failed to understand this threat, is an understatement. Being caught unaware of their unknown risk score values relative to competitors’ scores should be significantly unnerving to their leadership.

These leaders need to gauge their understanding and determine how quickly and sophisticated they can get. This includes ensuring that leaders develop the processes needed to identify proper risk scores, develop coding necessary to support diagnoses, and initiate analytics needed to identify gaps that require further investigation. So, the right time is now to lift the hood. Getting a risk adjustment engine to run over the next six months will be crucial to getting the most optimal risk score that properly reflects the health status of the members they have enrolled.

Resources

Gorman Health Group supports our clients in evaluating the efficiency, compliance, and strategic value of their risk adjustment programs from start to finish, and helps ensure that the procedures for capturing, processing and submitting risk adjustment data to CMS are accurate, timely, and complete. Visit our website to learn more >>

Listen as Janet Fina, GHG’s Vice President of Risk Adjustment, together with colleague, Carol Olson, GHG’s Director of Risk Adjustment, addressed areas for documentation improvement that will allow for accurate reimbursement and disease and case management opportunities. Become a member of the Point to access the recording >>

Save the Date for the Gorman Health Group 2015 Forum. Join us April 7-9, 2015 at the Gaylord National Resort and Convention Center in National Harbor, MD. Learn more about the event >>