Risk Adjustment Data Validation (RADV) Final Rule Out: What it Means for Your Organization

By Brian Murphy

The Risk Adjustment Data Validation (RADV) final rule is out. Others have covered the news better than I (see links below for what the rule says). Rather than add another voice in the chorus of “it’s out” I thought I’d voice a few thoughts on what the fallout will be, and should be. These are my opinions only.

First, it will be appealed, and challenged in court by the powerful insurance lobby.

Should it survive that challenge:

I hope CMS provides coding/CDI/risk adjustment compliance professionals much stronger and clearer guidance on what constitutes a reportable diagnosis that will stand up to audit. Multiple clinical examples with documentation from a medical record, added to the Medicare Managed Care Manual, would be wonderful.

We hear a lot about MEAT (and TAMPER), and while I love the acronym and find it easy to apply to a diagnosis, MEAT (monitored/evaluated/assessed/treated) is not actually in any regulation of which I’m aware. It’s an easy mnemonic, nothing more. Let me know if I’ve missed something here.

Respectfully, CMS is wrong in its belief that this is a non-issue for physicians and will not add to their administrative burden. There will be more clinical validation queries; how can there not be? We know that a physician’s statement of whether a diagnosis exists is enough to report a diagnosis, but that does not render it immune to denial. And later, financial penalties including extrapolation. Who wields the power here—CMS or the physician?

This is a clear call for MA plans and others to knock off the nonsense of telling coding and CDI teams to “turn up the gas” and report every old diagnosis, regardless of validity (i.e., a previous acute condition that is no longer receiving any treatment or even acknowledgement by a clinician). This is a broad brush and I don’t mean to implicate all, just the ones who do this.

Speaking of MA plans, I would not be surprised to see them scale back or cut out the benefits that set some of them apart from traditional Medicare (dental, gym memberships, etc.) in anticipation of extrapolated financial penalties which are now codified back to 2018.

We need better acknowledgment and remuneration for social determinants of health that truly add health risk.

There is an opportunity for better technology to tools in the industry to support this added documentation burden. Expect to see more solutions on the market.

Finally, it’s going to be an interesting next few months as we see how this all shakes out.

References

• Healthcare Dive, “CMS to crack down on Medicare Advantage Audits, poised to claw back billions of dollars from insurers” https://www.healthcaredive.com/news/federal-regulators-crack-down-on-medicare-advantage-audits-poised-to-clawb/641562/
• RISE, “CMS releases RADV final rule: Unwelcome changes ahead for Medicare Advantage plans” https://www.risehealth.org/insights-articles/cms-releases-radv-final-rule-unwelcome-changes-ahead-for-medicare-advantage-plans/
• CMS, “CMS Issues Final Rule to Protect Medicare, Strengthen Medicare Advantage, and Hold Insurers Accountable”: https://www.cms.gov/newsroom/press-releases/cms-issues-final-rule-protect-medicare-strengthen-medicare-advantage-and-hold-insurers-accountable

Actual rule itself: https://public-inspection.federalregister.gov/2023-01942.pdf