What does the acronym HCC represent in risk adjustment?

The acronym HCC stands for Hierarchical Condition Categories. This term is crucial in the context of risk adjustment models used, particularly in healthcare insurance programs. HCCs are groups of related conditions that are used to predict healthcare costs for patients based on their diagnoses. Each category is assigned a risk score that helps determine the expected costs for individuals with certain health conditions, allowing healthcare providers and insurers to better adjust payments based on the expected morbidity and complexity of patients they serve.

The importance of HCCs lies in their role in ensuring that health plans receive adequate funding to care for patients with varying health needs. By using HCCs, healthcare systems can more accurately account for the health status of enrollees, leading to more equitable financial support for the delivery of care.