Addressing Behavioral Health Services: Insurer and Provider Collaboration in Risk Adjustment Models

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Introduction

The recalibration of risk adjustment models for behavioral health services is a critical task for insurers to ensure fair compensation and incentivize the provision of high-quality care. This report examines how insurers are collaborating with behavioral health providers to gather insights and expertise to refine these models, thereby promoting better health outcomes and cost-efficiency.

Provider Collaborations

Measurement-Based Care Programs

Evernorth Health Services has launched a measurement-based care program, actively working with providers to develop standardized metrics for behavioral healthcare. The aim is to align payers and providers in measuring treatment success, which could lead to improved care and reduced costs. By standardizing measures across payers, Evernorth hopes to reduce the administrative burden on providers. This approach is relatively new in behavioral health compared to physical health. The program involves collaboration with providers to identify key measurements throughout the patient journey and standardize their capture. Initially, over 44,000 providers are participating, with plans to expand. Metrics include appointment wait times, avoidance of higher care levels, and total cost-of-care savings.

Technology and Data Integration

Advantasure highlights the evolving health plan-provider relationship into a partnership focused on delivering high-quality patient care. Technology plays a pivotal role by integrating Clinical Documentation Improvement (CDI) alerts into existing Electronic Medical Record (EMR) systems, reducing documentation burdens. AI and machine learning models are leveraged to predict member conditions and guide providers on the next best actions. This data exchange pre-identifies care gaps and supports risk adjustment documentation for timely reimbursements. Advantasure suggests that supporting providers with technology can improve risk scores and member outcomes.

Risk Adjustment Methodology

The American Academy of Actuaries explains that risk adjustment calibrates payments to health plans based on enrolled populations' relative risks, reducing incentives to avoid high-cost enrollees. The ACA risk adjustment program includes a model to assess individual risks and a payment transfer formula comparing each plan's risk to the market average. Changes to the program aim to better reflect differences in underlying risk among insurers. If market rules change, such as loosening guaranteed issue and rating restrictions, the need for risk adjustment may decrease. However, risk adjustment remains necessary if there are limits on premium increases based on health status.

Hierarchical Condition Category Coding

HCC coding is a risk-adjustment model that estimates future healthcare costs using ICD-10-CM codes to assign risk scores to patients. Insurance companies use these scores to adjust quality and cost metrics. In value-based payment arrangements, risk adjustment directly impacts revenue. Capitation models may base payment rates on a patient or practice’s average risk score. Incorporating social risk into risk adjustment models has been challenging, but some models are now using area deprivation index data. Z codes capture factors influencing health, including social determinants of health.

Challenges and Future Directions

  • Data Capture: Capturing social determinants of health and other nuanced factors remains challenging.
  • Standardization: There is a need for more standardized metrics across behavioral health services.
  • Regulatory Changes: Adjustments to risk adjustment models must keep pace with changes in health insurance market rules.
  • Provider Burden: Reducing administrative burdens on providers is essential for the successful implementation of new models.

Conclusion

Insurers and behavioral health providers are increasingly collaborating to refine risk adjustment models, ensuring they accurately reflect the care needs and associated costs of behavioral health services. Through measurement-based care programs, technology integration, and the use of sophisticated coding systems like HCC, these partnerships aim to improve the quality of care and optimize financial models. However, capturing complex data and adapting to regulatory changes remain significant challenges. Ongoing collaboration and innovation will be crucial to achieving success in this area.

Sources

  1. "Evernorth Eyes Behavioral Health Care Management Program." Healthcare Finance News, 2023.
  2. "Risk Adjustment: The Health Plan-Provider Partnership." Advantasure.
  3. "How Changes in Health Insurance Market Rules Would Affect Risk Adjustment." American Academy of Actuaries.
  4. "Hierarchical Condition Category (HCC) Coding." American Academy of Family Physicians.

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