Risk-Adjusted Reimbursement
Physicians in the United States find themselves in a seismic paradigm shift from volume-based
reimbursement to value-based reimbursement. This is being driven by escalating health care
costs and an increasingly-sicker population. Pay-for- performance is consequently based on
patient risk scoring, and quality measures are being used at every level of our health care system.
These changes are meant to stimulate quality improvement and cost-efficiency within the health
care system.
Physician reimbursement that is tied to patient risk scoring is here to stay, so it is imperative for
physicians to understand how patient risk scoring works because it will affect their income in
significant ways. Risk adjustment uses a patient’s health status in a base year to predict or estimate what utilization costs should be the following year. If a physician fails to recognize risk-adjusting diagnoses and under code them, they will likely fail under today’s value-based reimbursement system. The clinical management of the utilization-based spending that will be required to qualify for any shared savings incentives will be challenging.
If a physician can accurately and thoroughly document how sick their patients are, they stand a far
better chance of achieving their budget objectives. This, then, gives them the best opportunity to
receive the shared savings incentives and to minimize their risk for shared losses. Dr. Smith’s key steps to succeed under the new value-based, pay-for- performance reimbursement models include…
Verifying that your EHR is capable of submitting at least 12 diagnosis codes per clinical
encounter.
Retrieving, analyzing and understanding your Quality and Resource Use Reports (QRURs) for
Medicare Part B.
Getting informed and trained on risk adjustment methodology.
Scheduling all of your attributed patients in your managed care plans, including Medicare Part
B and Medicare Advantage plans, for an office visit at least once, and preferably twice, during
each calendar year.
Dr. Ronnie Smith is an internist with Vidalia Medical Associates. He has practiced medicine for
nearly 40 years. He has a medical degree from the Medical College of Georgia. Dr. Smith
graduated from the Executive Medical Management Program at the Wharton School at the
University of Pennsylvania. He is an expert in outpatient and inpatient risk adjustment documentation and coding and reimbursement, and he is passionate about educating his fellow
physicians and their practice staff on how to master risk adjustment and simplify the transition to
the new value-based care model.
Dr. Smith has developed innovative, point-of- care reference tools to assist physicians and medical practices that streamline the workflow process.
