In Medicare, which plan uses HCC-based risk scores to adjust payments for enrollees?

• A. Traditional Medicare uses HCC-based risk scores to adjust payments.
• B. HCCs are used only for determining eligibility.
• C. HCC scores have no impact on payments.
• D. Medicare Advantage plans use HCC-based risk scores to adjust payments for enrollees.

Answer: (D)

Medicare Advantage plans are paid through risk-adjusted capitation, using HCC-based scores to match payments to an enrollee’s expected costs. The CMS-HCC model assigns a risk score to each person based on demographic factors and diagnosed chronic conditions found in medical records and claims data. This score scales the monthly payment a Medicare Advantage plan receives for that enrollee—higher scores reflect sicker individuals and result in higher payments. Traditional Medicare, by contrast, pays on a fee-for-service basis and does not adjust payments using HCC risk scores for individual enrollees.