What is the purpose of the CMS-HCC model adjustment?

The purpose of the CMS-HCC model adjustment is primarily to influence the monthly payments made to Medicare Advantage plans. This model utilizes a hierarchical condition category (HCC) risk adjustment methodology, which helps ensure that payments to these plans are aligned with the health status and risk profiles of enrolled beneficiaries.

By accurately reflecting the health conditions of enrollees, the model aims to account for the variation in costs associated with treating individuals with different health needs. This adjustment is crucial because it helps maintain a financially sustainable system for Medicare Advantage plans while ensuring that they can adequately manage the care of their members based on their specific health conditions.

In contrast, the other options—annual auditing of claim costs, improvement of patient engagement strategies, and long-term funding for outpatient services—do not directly relate to the fundamental purpose of the CMS-HCC model adjustment, which is focused on the financial aspects of risk adjustment in the context of monthly payments for Medicare Advantage plans.