With COVID-19’s second wave testing the limits of our healthcare delivery system, we are focusing our analytic power on where it can have a real-world impact. One such area is using analytics to adjust relevant models for social inequities using Z codes.

Our commitment to this critical problem inspired us to look at the use of social determinants of health (SDOH)-related Z codes in the National Data Warehouse (NDW).

What are Z Codes?

First introduced for Medicare claims in 2016 after the implementation of ICD-10, a subset of Z codes can be used to account for patients’ SDOH.

Z codes are codes that can be attached to a medical claim and can include problems related to:

  • education and literacy
  • employment and unemployment
  • housing
  • occupational risks
  • social environment
  • upbringing
  • family and psychosocial circumstances

Who Can Input Z Codes?

Any clinician (physician, nurse, social worker, community health worker, case manager, or other providers) can document SDOH-related Z codes.

By describing each person’s unique health circumstances, Z codes can help providers and health plans connect members with helpful resources. They can also help data scientists understand the prevalence of certain SDOH factors and their relationship to medical outcomes. 

Z Codes are a powerful tool to track SDOH factors. They can help data scientists understand how such factors affect medical outcomes.

Z Codes Have Not Yet Caught On

According to a January 2020 report by CMS, of the 33.7 million total Medicare fee-for-service beneficiaries in 2017, only about 1.4% had medical claims with Z codes.

Unfortunately, within the Blue System, the use of Z codes is even lower. A recent BHI analysis of NDW data found that while there has been a steady increase in the use of Z codes, these codes continue to be severely underutilized. In the facility setting, less than .1% of all claims include SDOH-related codes. When they do, the top three codes were:

  • personal history of physical and sexual abuse in childhood
  • problems related to living alone
  • parent-biological child conflicts

Appropriately Increasing Z Code Use

While SDOH Z codes are used twice as often in professional claims, they are still rare. In these settings, the most commonly used SDOH-related Z code in the past four years related to relationship problems with spouses or partners.

BHI is especially excited about working with the Blue System in 2021 on this critical topic. Greater use of SDOH Z codes in NDW data can enhance our ability to use SDOH-related factors within our collective predictive and prescriptive modeling work.