Medicare Risk Adjustment

The Centers for Medicare and Medicaid Services (CMS) implemented the Risk Adjustment and Hierarchical Condition Category (HCC) coding model to adjust capitation payments made to Medicare Advantage plans for the risk of the beneficiaries they enroll. The CMS-HCC Risk Adjustment model assigns a risk factor score to a beneficiary based upon a combination of the individual’s health conditions and demographic details to account for predicted health care expenditures. The individual’s health conditions are identified by ICD-10-CM diagnosis codes that are submitted by providers through claims. There are nearly 10,000 ICD-10-CM codes that risk adjust. 


CMS Risk Adjustment guidelines require complete and current medical documentation in the individual’s medical record by a credentialed health care provider to support submitted diagnoses. Medical documentation must support the coding of conditions and include the provider’s assessment and/or plan for management of conditions. All conditions affecting the treatment or management of care need to be documented at least once a year, as applicable to providing care, to accurately reflect the complexity and severity of an individual’s health status.  

For information about this program
Call: 1-800-348-9804.