Talking HCCs: Utilizing HCC Coding Data

by Rose T. Dunn, MBA, RHIA, CPA, FACHE and Laurie M. Johnson, MS, RHIA, FAHIMA

Hierarchical Condition Categories (HCCs) are utilized by Medicare Advantage and Affordable Care Act (Obamacare) payers for approximately 30 million individuals currently. Use of HCCs is projected to grow significantly in coming years. Join us for a discussion of HCCs by two industry leaders: Rose T. Dunn, MBA, RHIA, CPA, FACHE, and Laurie M. Johnson, MS, RHIA, FAHIMA.  


Laurie: For Hierarchical Condition Categories (HCCs) to be successful, the provider must report all diagnoses that impact the patient’s evaluation, care, and treatment including co-existing conditions, chronic conditions, and treatments rendered.

Correct and complete coding of these HCCs creates a lot of data. How can HCC data be utilized by the hospital or vice versa?


RoseAs you know, all coded data is used by facilities and providers alike. The HCC data, like any of our ICD-10-CM data, represents the spectrum of diagnoses or conditions that are being treated.

A spike in an area’s reporting of a condition can signal an outbreak. For instance, salmonella. If we do some data diving, we may be able to find a locus for that salmonella. That’s the fun part about our data skills, we can play CSI without having to see the actual bloody parts! Ha!

But seriously, the composition of the conditions and our Case Mix Index (CMI) should be in sync and as we treat more complex patients, the Severity of Illness (SOI) should rise as well. That means we’re doing our job.

Laurie, how would you utilize the data?


Laurie: I think that a careful comparison between Evaluation and Management (E&M) levels and risk adjustment factors (RAF) can be very insightful.

If the RAF is high and the E&M level is low, then the level and diagnosis codes should be reviewed to ensure that all diagnoses were actively treated/monitored/assessed. The coder or CDI staffs could review the record to determine if something is missing from documentation or if the E&M level should be raised.

If the E&M level is high and the RAF is low, it should be a red flag that the level may be too high. The elements for E&M assignment should be compared to the documentation to ensure that the level is correct. These cases can be reviewed for the diagnosis accuracy too. Perhaps some additional documentation to gain an HCC diagnosis is required.

It is better for the organization or practice to review E&M levels before a regulatory agency decides to complete an investigation.

Rose, it was nice chatting with you!


Rose: You too! Hope the rest of your day goes well. 




Introduction to HCC Coding  Go beyond just the diagnoses — really understand the methodology behind HCCs! Learn how from nationally recognized HCC expert, Rose T. Dunn, MBA, RHIA, CPA, FACHE.




Rose Dunn is the Chief Operating Officer of First Class Solutions, Inc., a healthcare information management leader since 1988, offering professional consulting services in health information management operations and information governance issues, as well as coding support, coding quality reviews, privacy/security guidance, temporary (interim) management, revenue cycle oversight, and accreditation preparation.  Rose is the author of Libman Education’s online course: Fundamentals of HCC Coding as well as “The Revenue Integrity Manager’s Guidebook” available from the National Association of Healthcare Revenue Integrity and other books on coding management and auditing. Ms. Dunn holds a B.S. and M.B.A. from Saint Louis University.Contact Rose at 314-209-7800 or [email protected]  


Laurie M. Johnson, MS, RHIA, FAHIMA Laurie M. Johnson is a senior consultant at Revenue Cycle Solutions, LLC, a revenue cycle consulting firm specializing in revenue cycle assessments and work plan implementation; interim management with focus on process improvement; and revenue cycle education for hospitals and physician practices. Laurie is a past president of PHIMA and author of clinical coding articles for Journal of AHIMA and ICD-10 Monitor.

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.

One thought on “Talking HCCs: Utilizing HCC Coding Data

  1. Deborah M. Beiderbecke - April 11, 2019 at 7:20 pm

    I am an HIM student who will be graduating at the end of May (RHIT eligible). We had two guest speakers who just introduced us to HCCs.

    Like many new graduates, I have not yet decided which pathway to start on. Also, like many new graduates, I do not have the resources to purchase webinars, books, etc. I anticipate that over time I will have more focus to know what I want to invest in for my career.
    In the meantime, I will keep an eye on the products you are offering.
    Thank you.