HCCs and Coding for Value: A Virtual Roundtable Discussion, Part 2

What HCC training will coders need to be successful?

Hierarchical Condition Categories (HCCs) are utilized by Medicare Advantage and Affordable Care Act payers for approximately 30 million individuals currently.  Use of HCCs is projected to grow significantly in coming years and individuals with in-depth knowledge and command of the HCC system will be needed to ensure coding is accurate, supported by documentation, and that reimbursement is appropriate. We asked six experts what they thought about the challenges and opportunities provided by the accelerating move toward risk adjustment payment models.

In the second installment of this discussion, the experts discuss what HCC training coders will need to be successful. (See the series in its entirety here.)

“All coders need knowledge of HCC classifications, HCC guidelines, payment vs. nonpayment HCCs, and trumping logic.”

-Rose T. Dunn

DUNN: Four words: Anatomy, physiology, pharmacology, and pathophysiology. Coders also need to know ICD-10-CM really well, including how to maximize specificity (e.g., severity, laterality, and chronicity). Approximately 10,000 of the 75,000 or so ICD-10-CM codes are considered HCCs. Many unspecified codes simply aren’t recognized for payment in risk adjustment methodologies. In addition, half of the HCCs are also CCs or MCCs. This is good news for inpatient coders, but for ambulatory coders, it’s a whole new world.

All coders need knowledge of HCC classifications, HCC guidelines, payment vs. nonpayment HCCs, and trumping logic (i.e., the most significant subcategory in a hierarchy trumps others in that hierarchy). They also need education about HCC documentation requirements—the 10 principles of CMS HCCs and the RAD-V medical record review guidelines. For example, coders may not know that when reporting CMS HCCs, they can only code from a CMS-approved provider’s documentation. Nurses and dieticians don’t qualify. In a non-HCC environment, coders can capture body mass index from a dietician’s documentation and wound care levels from a wound care nurse’s documentation. Documentation used to validate HCCs must also include patient name, date, and provider signature (including credentials).

Finally, ambulatory coders need training around how and when to pose a compliant physician query for HCCs. For example, if a coder sees documentation stating a surgeon is creating a special diet plan, is that because the patient has diabetes? If the surgeon requests a larger surgical table, is that because the patient is obese? These are HCCs that add value in risk-adjusted payment models, and physicians need to note them in their documentation.

CASSIDY: Physician practice and ambulatory coders will need training on the documentation requirements for reporting an ICD-10 diagnosis code because diagnosis coding may be new to them. They’ll also need the ability to identify and address areas of HCC compliance risk within their practice (e.g., omitted diagnoses, mis-using the phrase ‘history of’ for active conditions, or not establishing a causal relationship between two diagnoses).

“…all coders need annual refresher training on the coding guidelines rather than relying solely on encoders to assist with coding.”

-Donna Malone

MALONE: There’s a big knowledge gap for many coders with pathophysiology, anatomy, and physiology as well as pharmacology. This knowledge base is imperative for capturing the most specific diagnoses. Oftentimes, I see coding programs that are simple bootcamps for CPC that do not require these additional courses or prior coding experience. These programs predominately focus on teaching the candidate to pass the test versus teaching the candidate to actually do the job. In addition, all coders need annual refresher training on the coding guidelines rather than relying solely on encoders to assist with coding. Rules such as ‘code all conditions that coexist at the time of admission, that develop subsequently, or that affect the treatment received and/or the length of stay’ are important. There’s a tendency for coders to only capture diagnoses that affect medical necessity or the DRG.

TAYLOR: I think all coder training should include HCC classifications, an overview of payment methodologies for various quality improvement initiatives, how to determine the top 10 HCCs in your practice or hospital, and how to monitor those diagnoses for compliance and to prevent revenue leakage. Pharmacology and pathophysiology are also important. Coders should know when and how to query for a definitive diagnosis in the presence of clinical signs and symptoms and/or the use of certain medications. Finally, training should include workflow implications of HCC capture (inpatient vs. outpatient settings). For example, in the outpatient setting, physicians typically select the code, and coders serve as auditors. The duration of patient encounters is only a few minutes in some cases, and there isn’t usually a formal process for queries. HCC capture in this setting requires a specific workflow that may not apply to the hospital setting.

MURPHY: Inpatient and outpatient coders both need training on HCC guidelines and classifications. I think they also need training on the inner-workings of risk-adjustment payment models, both big picture concepts and the nuances of those models. Managed Medicaid, for example, uses six different risk-adjustment models depending on the state. The depth of training into these models will vary depending on the direction in which the coder wants to take their career. An HCC auditor, for example, might need more training on a particular risk adjustment model.

“Training needs to focus more on why we code what we code – what’s the purpose? … The goal is to provide high-quality healthcare data.”

-Laurie M. Johnson

JOHNSON: Training needs to focus more on why we code what we code – what’s the purpose? I’m always surprised when coders tell me they report certain diagnoses simply because it’s what they’ve always done. This is a red flag. Coders should know why they collect this information because it will motivate them to go the extra mile. The goal is to provide high-quality healthcare data.




Bonnie S. Cassidy, MPA, RHIA, FAHIMA, FHIMSS, President of Cassidy & Associates



Rose T. Dunn, MBA, RHIA, CPA, FACHE, Chief Operating Officer, First Class Solutions, Inc.



Laurie M. Johnson, MS, RHIA, FAHIMA, Senior Healthcare Consultant, Revenue Cycle Solutions, LLC



Donna Malone, CPC, CRC, Director of Coding and Provider Education, Enterprise Risk Adjustment, Tufts Health Plan



John Murphy, MBA, Principal, Risk Adjustment Consulting



Earshler Taylor, RHIA, RHIT, CCS, CDIP, CPC-I, COC, CPC, Chief Executive Officer, Earshler Taylor Consulting



Lisa A. Eramo, MA, moderator and freelance writer



Fundamentals of HCC Coding
Go beyond just the diagnoses — really understand the methodology behind HCCs! Prepare for the future of healthcare reimbursement with “Fundamentals of HCC Coding,” by nationally recognized HCC authority Rose T. Dunn, MBA, RHIA, CPA, FACHE.  Learn more here.

About the Author

Libman Education
Libman Education Inc. is a leading provider of training for the health care workforce offering self-paced and instructor-led online courses designed and developed by leading industry experts in Health Information Management (HIM) and Medical Record Coding. Our courses are specifically designed to improve individual skills and increase the efficiencies and competencies of health care providers and institutions. At Libman Education, we understand the needs and challenges of a well-trained workforce and offer the right-mix of online education to ensure that the health care professionals are prepared to meet the challenges of the changing workplace.

2 thoughts on “HCCs and Coding for Value: A Virtual Roundtable Discussion, Part 2

  1. Marenie Begay - September 11, 2019 at 4:06 pm

    Good morning,
    Where can I go to attend one of your training, cost and travel to get there. I am certified CPC and code Inpatient/Clinical with Day Surgery.

    • Libman Education - September 13, 2019 at 3:21 pm

      Hi Marenie,
      Thanks for your inquiry! We offer online, self-paced training. Our course catalog is here:

      One program you may find interesting is our CDI Essential Skills course — a first step to a career in CDI. More info here:

      Also, you can always contact our Director of Education, Angela Lehoux, at [email protected] or 978-855-8816. She can help you to determine your courses based on your current level of coding skills and knowledge. Hope this helps!