Evaluate hierarchical condition categories for risk adjustment
Recommendation
The Centers of Medicare and Medicaid Services (CMS) should evaluate the need for additional mental health/substance use disorder (MH/SUD) health conditions as part of the Medicare Advantage risk adjustment process, including those related to social determinants of health (SDOH).[1]
Background/summary
Risk adjustment is a method used by CMS to ensure private Medicare Advantage plans are compensated for beneficiaries who have significant health care needs. Health plans participating in Medicare Advantage who provide coverage to these high-risk beneficiaries receive extra payments to help defray the cost of the care provided.[2] Hierarchical Condition Categories are used as a risk-adjustment tool by CMS to estimate the future cost of care for patient populations based on a range of physical health factors and some pertaining to MH/SUDs for Medicare Advantage (MA) plans.[3]
Congress directed CMS to evaluate whether additional MH/SUD factors should be included in risk adjustment, but screening for some common conditions such as anxiety, and factors related to social determinants of health (SDOH) remain unaddressed.[1] Nearly 30 percent of Americans are affected by anxiety at some point in their lives.[4] SDOH impacts the likelihood of a person to require MH/SUD treatment and their likelihood of accessing treatment.[5][6] Congress and CMS should work together to determine what additional MH/SUD and SDOH factors should be included in Hierarchical Condition Categories to effectively estimate risk adjustment payments, which may improve access to MH/SUD care for beneficiaries enrolled in Medicare Advantage plans.[1]
citations
1. Bipartisan Policy Center. Tackling America’s Mental Health and Addiction Crisis Through Primary Care Integration. Last Updated March 2021.
2. The Commonwealth Fund. Taking Stock of the Medicare Advantage Program: Risk Adjustment. Last Updated February 17, 2022.
3. American Academy of Family Physicians. Hierarchical Condition Category Coding. (n.d.)
4. American Psychiatric Association. What are Anxiety Disorders? Last Updated June, 2023.
5. U.S. Department of Health and Human Services, Substance Abuse and Mental Health Services Administration. Behavioral Health Equity. Last Updated May 25, 2023.
6. Ponte, Katherine. Ways We Can Address the Social Determinants of Mental Health. National Alliance of Mental Illness. Last Updated August 6, 2020.