HCC Coding and RAF Scores: A Practical Primer

If your practice participates in Medicare Advantage or another value-based contract, you've likely heard the terms "HCC coding" and "RAF score" used as if everyone already understands them. Here's the practical version.

What is a Hierarchical Condition Category (HCC)?

HCCs are groups of ICD-10-CM diagnosis codes that CMS uses to predict a patient's expected healthcare costs. Not every diagnosis maps to an HCC — only chronic and serious conditions that materially affect cost of care, such as diabetes with complications, congestive heart failure, or chronic kidney disease.

Each HCC carries a relative weight. Patients with more — and more severe — HCCs are expected to cost more to treat, and risk-adjusted payments are calibrated accordingly.

What is a RAF score?

A patient's Risk Adjustment Factor (RAF) score is the sum of their demographic risk factors (age, sex, Medicaid dual-eligible status) plus the weights of every active HCC captured for that patient in the measurement year.

RAF scores matter because Medicare Advantage plans are paid, in part, based on the average RAF score of their enrolled population. If a practice's documented RAF scores understate how sick their patients actually are, the health plan — and often the practice, under risk-sharing arrangements — is compensated as if the population were healthier than it is.

Why HCCs have to be recaptured every year

This is the detail that trips up the most practices: HCCs reset every calendar year. A condition coded in 2025 does not automatically carry into the 2026 RAF calculation. If a patient's chronic kidney disease isn't addressed and coded again during a 2026 encounter, it effectively "disappears" from that year's risk score — even though the patient's condition hasn't changed.

This is why risk adjustment coding emphasizes closing documentation gaps proactively each year, not just capturing new diagnoses.

MEAT criteria: the documentation standard

CMS and payer auditors evaluate whether an HCC-eligible diagnosis is adequately supported using the MEAT framework. For a condition to be coded, the note should reflect at least one of:

• Monitored — signs, symptoms, disease progression
• Evaluated — test results, medication effectiveness, response to treatment
• Assessed/Addressed — counseling, clinical review of the condition
• Treated — medications, therapies, referrals, other treatment

A diagnosis simply listed in a problem list without MEAT-supporting documentation elsewhere in the note is a common audit finding — and a common reason RAF-driving revenue doesn't hold up under review.

Practical steps for practices

1. Review active problem lists at the start of each calendar year to identify chronic conditions that need to be re-addressed and re-documented.
2. Train providers on MEAT-compliant documentation, not just on diagnosis capture — a listed diagnosis without supporting documentation creates audit risk without securing the RAF benefit.
3. Use suspect condition reporting to flag likely-but-undocumented conditions (for example, a patient on insulin without a current-year diabetes diagnosis) so they can be addressed during active care.
4. Run periodic chart audits against MEAT criteria before, not after, a payer or CMS RADV review.

Risk adjustment coding done well doesn't inflate a patient's risk score artificially — it ensures the documented record accurately reflects the complexity of care the practice is already providing, which is the entire intent of the CMS-HCC model.