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What are HCCs?

When we submit an insurance claim for a provided service, we will typically submit an ICD code that accurately describes the patients condition to the payer AND also will justify the medical necessity for additional tests that were ordered. For example, if a patient with moderate dry macular degeneration and primary open angle glaucoma that received an office visit and also a macular photograph as part of their care, the coding may look like this:

  • 92014 - H31.3132 (Nonexudative age-related macular degeneration, bilateral, intermediate dry stage)

  • 92250 - H31.3132

When the information is submitted to the payer, even though we may have provided attention to and treatment for the glaucoma, traditionally that code may be left off of the claim form since the provider would be paid for all the procedures/services with one code (H31.3132). In the past leaving off the additional codes did not seem detrimental to the practice because it did not impact reimbursement for those procedures.


Under new payment systems, it is important to include all relevant diagnosis to let payers know the complexity of the examination and to help them adjust patient risk profiles. Hierarchical Condition Categories (HCCs) are ICD codes that trigger a risk adjustment used by:

  • Medicare Advantage plans

  • Accountable Care Organizations (ACOs)

  • Value based payment adjustments (like MIPS and MACRA)

These programs use HCCs to modify payment to an organization or provider in the care of patients.

Let me try to paint a clearer picture by using an ACO as an example. An ACO is built to be "accountable" for the care they are providing. This means that by sharing in the risk, they will also share in the reward. In this hypethetical example, if an ACO receives (from CMS) $1,000/month/patient to provide care to 1000 patients then that ACO will receive $1,000,000/month to care for those patients. If their costs to provide the care that those patients need are less than $1,000,000/month, the ACO will make money. If they spend more than $1,000,000/month, they will lose money. The ways that an ACO can generate a profit are to:

  1. Provide preventative services that keep people healthy. Which means out of the hospital, ER, and to prevent other more costly procedures.

  2. Show CMS that these 1000 have more chronic diseases (evidenced by HCCs), that require more money to manage.

So, if an ACO can show CMS that they are caring for patients with more chronic conditions, then they justify more money per patient per month. So for patients with a greater number of HCCs, the ACO may receive (in our example) $1,500/month/patient.

How does that impact optometric physicians?

  • The more HCC codes we report appropriately for our patients, the more attractive we become to work with, both inside ACOs and as partners with them.

  • There is a "value-based" payment adjustment in MIPS, which is calculated by comparing the cost of YOUR care for each beneficiary to an expected cost per beneficiary determined by the risk of YOUR patients. The basis of this risk adjustment will be based on how YOU code HCC for YOUR patients.

  • If we are coding HCC when appropriate, the Medicare Advantage plans should have more income from CMS and could theoretically forward some of that on to the providers as increased payments for services to beneficiaries.

Below is a (non-exhaustive) list of commonly used codes in optometry that if appropriate should be included on the claim form once per year even if it is a secondary diagnosis:

  • H40.10X(0,1,2,3,4) - Unspecified open-angle glaucoma

  • H40.11X(0,1,2,3,4) - Primary open-angle glaucoma

  • H40.121(0,1,2,3,4) - Low-tension glaucoma, right eye

  • H40.122(0,1,2,3,4) - Low-tension glaucoma, left eye

  • H40.123(0,1,2,3,4) - Low-tension glaucoma, bilateral

  • H40.129(0,1,2,3,4) - Low-tension glaucoma, unspecified eye

  • H40.131(0,1,2,3,4) - Pigmentary glaucoma, right eye

  • H40.132(0,1,2,3,4) - Pigmentary glaucoma, left eye

  • H40.133(0,1,2,3,4) - Pigmentary glaucoma, bilateral

  • H40.139(0,1,2,3,4) - Pigmentary glaucoma, unspecified eye

  • H40.15(1,2,3,9) - Residual stage of open-angle glaucoma

  • H43.1(0,1,2,3) - Vitreous hemorrhage

  • I10 - Essential (primary) hypertension

Find a complete list here.

The take home for our practices is to include all diagnosis codes on our claim forms that are pertinent to that patient at least 1 time per year. The older claim forms were limited to 4 diagnosis codes, current forms have room for 12, so we should have room for all HCCs. Have a great week! - Chris

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