Hierarchical Condition Category (HCC) and Risk Adjustment Models
Model families and hierarchy
Risk adjustment models map ICD-10-CM codes to Hierarchical Condition Categories. CMS-HCC serves Medicare Advantage; HHS-HCC serves ACA plans; RxHCC serves Part D; separate ESRD models exist. Each HCC carries a coefficient, and the model version (for example V22, V24, V28) matters because mappings and coefficients change between versions.
The hierarchy means that within a related disease family only the highest-ranked HCC is paid - diabetes with complications suppresses uncomplicated diabetes - but unrelated HCCs in different families can all count. Segments (community, institutional, new enrollee; aged versus disabled) determine which demographic factors apply, and interaction factors may add payment when specified combinations exist.
Traps: assuming a hierarchy removes every other diagnosis; submitting a code that maps to a lower-ranked HCC when a complication is documented; ignoring model version; assuming RxHCC and CMS-HCC share a mapping; and treating a suspect condition as payable.
Rule of thumb: one HCC per hierarchy family, many families per person. Worked example: a record documents diabetic peripheral neuropathy. The coder reports E11.40, which ranks above uncomplicated diabetes (E11.9), so the complicated HCC is the one counted for that family.