Risk, Revenue, and Care: Understanding the Basics of RAF

A Risk Adjustment Factor (RAF) score is assigned to each VBC patient, and the score is permanent. A higher RAF score is produced by medical diagnoses that are more complicated. The more resources needed to care for a patient, the higher their score, and as a result, Medicare pays more to treat them. RAF scores trace the patient back to the group that assumed risk for them, regardless of where the diagnosis and HCC codes come from. This means that if your patient visits a cardiologist and is identified as having afib, it will affect your capitated payment from CMS. And that will also have an effect on the treatment needed to keep the patient well and out of unnecessary hospital stays.

Despite the fact that there are more than 80 HCC codes, Medicare has designated 8 specific categories of HCCs for the following conditions: cancer, diabetes, COPD, renal illness, drug use disorder, cardiorespiratory failure, mental disorders, pressure ulcers, pressure sores. HCC codes that are a part of one of these groups could be replaced by another HCC that is a higher-ranking member of the same group.

Medical complexity as determined by reported & diagnosed cases Reimbursement

As previously said, there is a fairly complex link between HCCs and RAF, but the most important thing is to accurately record all patient problems and to treat each patient according to the degree of complexity that has been identified. Each patient has an individual RAF score, which normally ranges from 0.6 to 1.2. In a risk contract, CMS pays for each patient in accordance with their RAF score, which is then modified for their age, sex, and area healthcare expenses.

Therefore, the total compensation for that population is determined by the overall average RAF within a contract. When CPT codes are submitted in an FFS arrangement, payments are described as being made per head rather than per action. The total population RAF and the total capitated payments are examined to see how closely a contract corresponds with local norms, numbers per clinic, or numbers per doctor's panel. This is known as the per-member per-month average (PMPM) of revenue.