Which risk adjustment model is most commonly used by Medicare?

The most commonly used risk adjustment model by Medicare is the Hierarchical Condition Category (HCC) model. The HCC model is specifically designed to better align Medicare payments with the health status of beneficiaries, based on the diagnosis codes reported during medical encounters. It captures the complexity and severity of illnesses by grouping various conditions into categories that reflect the risk of future healthcare costs associated with those conditions.

The HCC model is vital for ensuring that healthcare providers receive appropriate reimbursements reflecting the actual health needs of their patient populations. It uses a combination of demographic factors and diagnosis codes to predict healthcare costs, which is particularly important in a program like Medicare that serves a diverse and often frail elderly population.

Other models, such as the Chronic Illness and Disability Payment System (CDPS), are used in different contexts or for specific populations, but they do not have the same level of application within Medicare as the HCC model. The blended and fee-for-service options represent different payment methodologies rather than risk adjustment models tailored for predicting cost based on patient risk factors. Thus, HCC is the clear standard in Medicare risk adjustment.