HRADV: What you don’t know could cost you millions

June 10, 2015
|In Policy & Health Reform, Brain Food, Risk Adjustment
|By GHG Advisors

Now that the 2014 EDGE server submission is complete, it will soon be time to audit a large sample of the data. Are you ready?

HRADV is the Commercial Risk Adjustment Data Validation that will be conducted annually on the data submitted to the EDGE server. This audit is similar in nature to the Medicare Risk Adjustment Data Validation (RADV) with a few exceptions. You do not get selected for the HRADV; rather, it is an annual requirement that the auditing process is conducted on at least 200 members. An error percentage will be assigned for health status and demographic information that does not have appropriate supporting documentation. This error percentage amount will be deducted from the prospective years’ risk adjustment payment, or a payable will be due to The Department of Health and Human Services (HHS).

I have heard many health plans say, “There are no financial implications to the 2014 and 2015 HRADV errors” and “These are the learning curve years.” While both statements are true, the fact of the matter is, these years DO count. You could be leaving millions of dollars behind for these years, not only for risk adjustment but for reinsurance as well. You are also at risk of being fined a significant error penalty after the “learning curve” years. Now is the time to ensure you have all of the necessary processes in place. Here are a few questions to ask yourself about the risk adjustment operations at your company:

  • Are your providers familiar with the tremendous impact the transition from ICD-9 to ICD-10 has on risk adjustment, reinsurance, Stars, and the Healthcare Effectiveness Data and Information Set (HEDIS®)?
  • Do you have the right staffing in place to support end-to-end risk adjustment successfully?
  • Did you successfully submit complete and accurate 2014 data to the EDGE server?

There are many areas inside and outside of the company where membership and claims data may be compromised. This information is being sent through many different systems which increases the probability for information to unknowingly be altered. Here are some tips to prevent submitting incorrect or incomplete data to the EDGE server:

  1. Ensure you have a solid provider contract and education program in place.
  2. Align a risk adjustment staffing model appropriate for your organization.
  3. Develop ongoing data review and reconciliations with various departments throughout the company to create data integrity.
  4. Be prepared for the HRADV and appeals process.

HRADV and appeals is the final step in the risk adjustment process. More information will be released from HHS regarding the specifics around the audit for 2014. Be prepared and ensure you have selected your Initial Validation Auditor (IVA).

 

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